Ok. So you send a California 20 day notice to the property owner and to the prime contractor (as of July 1, 2012 the prime contractor is now called "Direct Contractor" and the Notice is called the CALIFORNIA PRELIMINARY NOTICE) on the project... you know... just like you’re supposed to. Then it hits the fan. You get a call from an indignant general contractor who asks you why you do not trust his company. "I pay ALL my subs"... he says so... "Why did you send the owner a Pre-Lien?" Now here comes the kicker... "The owner is freaking out and you just made it hard for me to get a check cut and that makes it harder for me to cut a check to you!"
Now you ask yourself if you should have sent the Preliminary Notice in the first place. You want to keep doing work for this general so the last thing you need is to make the guy mad… right? He’ll never call me for work again you think. Most of the time the general pays so why was it worth all this hassle, for probably no reason, which might have cost me jobs from this guy.
Let’s clear one thing up right now. Whenever the “people” who have control of the purse strings on ANY job with ANY general have not directly signed a contract with you… SEND THEM THE 20 DAY NOTICE! It protects you (every interested party knows you must be paid), it protects the general (the owner knows he needs to pay the general promptly so he can pay you and keep you happy) and it protects the owner (they know they need to make sure the general is paying you.. his sub)! The bad feelings you have created with the owner and the general are not because you have given them the 20 Day Notice. These bad vibes happened because of the WAY you gave them the Pre-Lim Notice.
“HUH???”… You think.
The real cause of this headache is because most people, general contractors included, look at the California Preliminary 20 Day Notice and see “LIEN!” It doesn’t matter that our California Preliminary Notice Form says right at the top “THIS IS NOT A LIEN”, the fact that they had to sign for it and that it has that “legal” look to it screams LAWYER! And don’t you just love to get legal papers like this yourself? … It makes your day doesn’t it? No wonder someone freaks when they get one of these.
So… what did you do wrong and how can you keep this from happening in the future???
“YOU DIDN’T EDUCATE THEM!” You asked them to “eat” a “dry” legal form without any “sauce” to make it go down easier. ALWAYS include an explanatory letter (the sauce) when you give a Pre-Lien. If you purchase a 20 Day Notice from us or if you purchase ACT Contractors Forms on Disk for California Contractors (or for any other state that uses a notice like this) we always include a transmittal letter just for this purpose. Our letter, and so should yours, tells the person receiving the pre-lien, among other things, that:
1) It is not a lien but rather a notice required by law for THEIR protection.
2) It is to inform the recipient that you are a subcontractor on their project and have a right to lien if you are not paid.
3) It does NOT mean the general is untrustworthy.
4) It does not mean that the general has not been paying you or that the general owes you money.
5) You have confidence in the general.
6) By law, the recipient of this notice has a duty to see that you are paid from payments made to the general for work you have done.
Use this transmittal letter as an opportunity to butter up the general… not tear them down… that way they will still like you… and call you on their next job!