Construction Liens on Public vs. Private Projects: Key Differences

Construction liens are a powerful legal tool for securing payment on construction projects, but the rules vary significantly depending on whether the project is public or private. Understanding these differences can help contractors, subcontractors, and suppliers protect their rights and recover unpaid dues effectively.

Construction Liens on Private Projects

On private construction projects, a lien is typically filed against the property itself. This means the property owner cannot sell, refinance, or transfer the property without first resolving the lien.

Key Points for Private Project Liens

• Direct Attachment to the Property: The lien becomes a legal claim against the property where work was performed.
• Filing Deadlines: Deadlines vary by state but are usually counted from the date work was completed or materials were delivered.
• Preliminary Notices: Many states require contractors to send a preliminary notice to the property owner to preserve lien rights.
• Enforcement: If payment is not made, the lien can be enforced through a foreclosure action, potentially leading to the sale of the property.

Construction Liens on Public Projects

Public projects, such as schools, highways, and government buildings, cannot be subjected to traditional liens because the property is owned by a public entity. Instead, payment protection is typically provided through a payment bond.

Key Points for Public Project Liens (Payment Bonds)

• Payment Bond Requirement: Federal and state laws often require contractors on public projects to post a payment bond before work begins.
• Bond Claims Instead of Liens: Instead of filing a lien, unpaid subcontractors and suppliers file a claim against the payment bond.
• Deadlines for Bond Claims: Bond claim deadlines are strict and may be shorter than private lien deadlines, making prompt action essential.
• Notice Requirements: Many states require formal notice to the general contractor and the bonding company before a claim is valid.

Why the Difference Matters

The process for recovering payment is fundamentally different between public and private projects. Filing the wrong type of claim or missing required notices can result in losing your right to payment entirely. Contractors and suppliers must understand the project type before work begins to ensure proper procedures are followed.

Best Practices for Both Project Types

1. Identify the Project Type Early

Confirm whether the project is public or private during contract negotiations. This determines whether you will use a lien or a bond claim to secure payment rights.

2. Keep Detailed Documentation

Maintain records of contracts, change orders, invoices, delivery receipts, and all correspondence. Good documentation strengthens both lien and bond claims.

3. Track Deadlines Carefully

Deadlines for filing liens or bond claims are strict. Mark these dates in your project calendar and act quickly if payment delays occur.

4. Seek Legal Guidance When Needed

Whether dealing with a private lien or a public bond claim, having an experienced legal team ensures you meet all legal requirements and maximize your chances of recovery.

How Miller, Ross & Goldman Can Help

While both public and private projects offer legal protections for contractors and suppliers, the procedures and legal remedies differ significantly. Knowing these differences before starting work can mean the difference between getting paid and losing your claim. 

Our team has extensive experience navigating lien and bond claim laws on both public and private projects. We help contractors, subcontractors, and suppliers protect their payment rights through precise legal action, from sending notices to enforcing claims in court.

If you are facing unpaid invoices on a construction project, Miller, Ross & Goldman can help you take the proper steps to secure payment with our comprehensive construction lien services. Contact us today to request a quote.