Louisiana's Private Works Act - Do I need to file a Notice of Contract?
Effective January 1, 2020, Louisiana's Private Works Act (PWA) was amended to reflect modified notice requirements, deadlines, definitions, and processes for parties to follow. These revisions do not change the purpose of the PWA, which offers certain statutory claims for payment to parties that perform work on private construction projects, but impact the details protecting the preservation of claims.
Preservation of Claims and Privileges
The 2019 revisions make substantive changes to the section of the PWA that establishes the procedure parties must follow to preserve liens:
Claimants are no longer required to wait until the start of the lien-filing period to file a lien.
New outside deadlines are established for lien filing in situations where a notice of termination of the contract is not filed.
Under existing law, a claimant must file a statement of claim within a predefined time period (30 days, 60 days, or 70 days) in order to preserve his PWA claim and privilege. The proper time period turns on several factors, including the claimant’s role in the project, whether a notice of contract was timely filed, and whether a notice of termination was timely filed after the project was completed. Under the new law, there remain several time periods within which a claimant must file a statement of claim, including a new six-month period (for non-general contractor claimants) and a new seven-month period (for general contractors) if no notice of termination is filed.
Impact on Notice of Contract
Louisiana requires any party that contracts with an owner to file a notice of contract before the delivery of materials or labor to the project in order to preserve their rights. Previously this was required for contracts of more than $25,000, however the 2019 revisions to the PWA raise the threshold to contracts of more than $100,000.
Additionally, the notice of contract previously required a "legal property description" of the property at issue. The 2019 revisions now require a "complete property description of the immovable" which requires a greater degree of specificity of property descriptions in filings. A definition of this term can be found in the new section "Miscellaneous definitions."
In many ways these additions should assist smaller contractors complete smaller projects without the requirement of a notice to contract and potentially file liens in a potentially longer timeframe. If you have questions about the Private Works Act or the lien process, Montiel Hodge can help.
