Should You Use the Ship Date or Delivery Date When Calculating Mechanic’s Lien and Bond Claim Deadlines?
We are often asked “Should I use my ship date or delivery date to calculate my lien deadlines?” Furnishing dates can make or break your rights to file a mechanic’s lien or serve a bond claim. In fact, your first furnishing and last furnishing dates are two of the 5 key pieces of information needed to determine whether you are within your rights to properly secure your claim.
Need a refresher on the other key pieces?
- the project type
- who you sold to in the ladder of supply
- the state in which the project is located
- first and
- last furnishing dates
This information, at a bare minimum, typically provides the framework for calculating preliminary notice, mechanic’s lien, bond claim & suit/foreclosure deadlines.
We’ve previously discussed what constitutes a furnishing date, and we talked about those instances where a notice should be served after you begin furnishing and when mechanics lien and bond claim deadlines are based on completion.
Today, let’s answer this question:
“Should I use my ship date or delivery date to calculate my deadlines?”
I would love to make an easy blanket statement that it doesn’t matter… but you and I both know that would be a lie! Each state, as with everything else as it pertains to lien rights, has its own definition of what a furnishing date is.
Now, I will say that we always recommend calculating deadlines conservatively (in most cases it’s better to be a wee bit early than a wee bit late) and using the earlier ship date for furnishing would be more conservative than using the delivery date.
Examples: New Jersey & Ohio
In New Jersey, “furnishing” is defined as the “date you furnish” which could be strongly argued to mean the date you shipped to your customer or jobsite vs. the date the materials actually arrived on the jobsite.
Further, your contract may dictate whether or not the ship date or a delivery date should be used as your furnishing date. If you are responsible for the freight charges or delivery of the materials, the delivery date can be used – I like to think of it as the date the materials left your hands.
If you are not responsible for shipment (for example, the materials are being shipped F.O.B. by common carrier) the ship date should be used (again, think of it as the date the materials left your hands).
In Ohio, our attorney has advised that first furnishing is based upon when the materials shipped to the jobsite and not when they arrived. This can be crucial in calculating the timeliness of the preliminary notice or mechanic’s lien.
Invoice Dates vs. Furnishing Dates
Another factor to consider is whether you are basing your deadlines on invoice dates instead of actual shipping or delivery dates. Be careful with invoice dates, be sure that the date you are using is not later than your ship date or, in the case of services, the date the services were actually provided.
Oh no! What do I do?!
When calculating deadlines, it is always best to be conservative. Be sure to list the earlier of the dates, which will most likely be the actual ship date.