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H.B. 154 Enrolled

             1     

STATE CONSTRUCTION REGISTRY

             2     
AMENDMENTS

             3     
2009 GENERAL SESSION

             4     
STATE OF UTAH

             5     
Chief Sponsor: Michael T. Morley

             6     
Senate Sponsor: Wayne L. Niederhauser

             7     
             8      LONG TITLE
             9      General Description:
             10          This bill amends the State Construction Registry and certain related powers of the
             11      Division of Occupational and Professional Licensing (DOPL).
             12      Highlighted Provisions:
             13          This bill:
             14          .    modifies the definition of final completion of an original contract and project;
             15          .    modifies the subcontractor preliminary notice requirements;
             16          .    modifies the notice of commencement filing requirements;
             17          .    modifies the DOPL standardized building permit numbering system;
             18          .    prohibits a compliance agency from deviating from the DOPL standardized
             19      building permit numbering system; and
             20          .    makes technical corrections.
             21      Monies Appropriated in this Bill:
             22          None
             23      Other Special Clauses:
             24          None
             25      Utah Code Sections Affected:
             26      AMENDS:
             27          38-1-7, as last amended by Laws of Utah 2007, Chapter 332
             28          38-1-31, as last amended by Laws of Utah 2008, Chapter 382
             29          38-1-32, as last amended by Laws of Utah 2007, Chapter 332


             30          58-56-19, as enacted by Laws of Utah 2006, Chapter 297
             31          58-56-20, as last amended by Laws of Utah 2008, Chapter 328
             32     
             33      Be it enacted by the Legislature of the state of Utah:
             34          Section 1. Section 38-1-7 is amended to read:
             35           38-1-7. Notice of claim -- Contents -- Recording -- Service on owner of property.
             36          (1) (a) (i) Except as modified in Section 38-1-27 , a person claiming benefits under this
             37      chapter shall file for record with the county recorder of the county in which the property, or
             38      some part of the property, is situated, a written notice to hold and claim a lien [within] no later
             39      than:
             40          (A) 180 days after the day on which occurs final completion of the original contract if
             41      no notice of completion is filed under Section 38-1-33 ; or
             42          (B) 90 days after the day on which a notice of completion is filed under Section
             43      38-1-33 but not later than the time frame established in Subsection (1)(a)(i)(A).
             44          (ii) For purposes of this Subsection (1), final completion of the original contract, and
             45      for purposes of Section 38-1-33 , final completion of the project, means:
             46          (A) if as a result of work performed under the original contract a permanent certificate
             47      of occupancy is required for the work, the date of issuance of a permanent certificate of
             48      occupancy by the local government entity having jurisdiction over the construction project;
             49          (B) if no certificate of occupancy is required by the local government entity having
             50      jurisdiction over the construction project, but as a result of the work performed under the
             51      original contract an inspection is required as per state-adopted building codes for the work, the
             52      date of the final inspection for the work by the local government entity having jurisdiction
             53      over the construction project; [or]
             54          (C) if with regard to work performed under the original contract no certificate of
             55      occupancy and no final inspection are required as per state-adopted building codes by the local
             56      government entity having jurisdiction over the construction project, the date on which there
             57      remains no substantial work to be completed to finish the work on the original contract[.]; or


             58          (D) if as a result of termination of the original contract prior to the completion of the
             59      work defined by the original contract, the compliance agency does not issue a certificate of
             60      occupancy or final inspection, the last date on which substantial work was performed under
             61      the original contract.
             62          (b) Notwithstanding Section 38-1-2 , where a subcontractor performs substantial work
             63      after the applicable dates established by Subsections (1)(a)(ii)(A) and (B), that subcontractor's
             64      subcontract shall be considered an original contract for the sole purpose of determining:
             65          (i) the subcontractor's time frame to file a notice of intent to hold and claim a lien
             66      under this Subsection (1); and
             67          (ii) the original contractor's time frame to file a notice of intent to hold and claim a
             68      lien under this Subsection (1) for that subcontractor's work.
             69          (c) For purposes of this chapter, the term "substantial work" does not include:
             70          (i) repair work; or
             71          (ii) warranty work.
             72          (d) Notwithstanding Subsection (1)(a)(ii)(C), final completion of the original contract
             73      does not occur if work remains to be completed for which the owner is holding payment to
             74      ensure completion of that work.
             75          (2) (a) The notice required by Subsection (1) shall contain a statement setting forth:
             76          (i) the name of the reputed owner if known or, if not known, the name of the record
             77      owner;
             78          (ii) the name of the person:
             79          (A) by whom the lien claimant was employed; or
             80          (B) to whom the lien claimant furnished the equipment or material;
             81          (iii) the time when:
             82          (A) the first and last labor or service was performed; or
             83          (B) the first and last equipment or material was furnished;
             84          (iv) a description of the property, sufficient for identification;
             85          (v) the name, current address, and current phone number of the lien claimant;


             86          (vi) the amount of the lien claim;
             87          (vii) the signature of the lien claimant or the lien claimant's authorized agent;
             88          (viii) an acknowledgment or certificate as required under Title 57, Chapter 3,
             89      Recording of Documents; and
             90          (ix) if the lien is on an owner-occupied residence, as defined in Section 38-11-102 , a
             91      statement describing what steps an owner, as defined in Section 38-11-102 , may take to
             92      require a lien claimant to remove the lien in accordance with Section 38-11-107 .
             93          (b) Substantial compliance with the requirements of this chapter is sufficient to hold
             94      and claim a lien.
             95          (3) (a) Within 30 days after filing the notice of lien, the lien claimant shall deliver or
             96      mail by certified mail a copy of the notice of lien to:
             97          (i) the reputed owner of the real property; or
             98          (ii) the record owner of the real property.
             99          (b) If the record owner's current address is not readily available to the lien claimant,
             100      the copy of the claim may be mailed to the last-known address of the record owner, using the
             101      names and addresses appearing on the last completed real property assessment rolls of the
             102      county where the affected property is located.
             103          (c) Failure to deliver or mail the notice of lien to the reputed owner or record owner
             104      precludes the lien claimant from an award of costs and attorneys' fees against the reputed
             105      owner or record owner in an action to enforce the lien.
             106          (4) The Division of Occupational and Professional Licensing shall make rules
             107      governing the form of the statement required under Subsection (2)(a)(ix).
             108          Section 2. Section 38-1-31 is amended to read:
             109           38-1-31. Building permit -- Construction -- Notice registry -- Notice of
             110      commencement of work.
             111          (1) (a) (i) (A) For a construction project where a building permit is issued to an
             112      original contractor or owner-builder, [within] no later than 15 days after the issuance of the
             113      building permit:


             114          (I) the local government entity issuing that building permit shall input the building
             115      permit application and transmit the building permit information to the database electronically
             116      by way of the Internet or computer modem or by any other means; [and] or
             117          (II) the original contractor, owner, or owner-builder may file a notice of
             118      commencement [based on the building permit issued by the local government entity] with the
             119      database whether or not a building permit is issued or a notice of commencement is filed
             120      under Subsection (1)(a)(i)(A)(I).
             121          (B) The information submitted under Subsection (1)(a)(i)(A) forms the basis of a
             122      notice of commencement.
             123          (ii) The person to whom a building permit, filed under Subsection (1)(a)(i), is issued is
             124      responsible for the accuracy of the information in the building permit.
             125          (iii) For the purposes of classifying a record under Title 63G, Chapter 2, Government
             126      Records Access and Management Act, building permit information transmitted from a local
             127      governmental entity to the database shall be classified in the database by the division
             128      notwithstanding the local governmental entity's classification of the building permit
             129      information.
             130          (b) [Within] No later than 15 days after commencement of physical construction work
             131      at the project site, the original contractor, owner, or owner-builder may file a notice of
             132      commencement with the database whether or not a building permit is issued or a notice of
             133      commencement is filed under Subsection (1)(a).
             134          (c) An original contractor, owner, or owner-builder may file a notice of
             135      commencement with the designated agent prior to the time frames established in Subsections
             136      (1)(a) and (b).
             137          [(c)] (d) An owner of construction or an original contractor may file a notice of
             138      commencement with the designated agent within the time prescribed by Subsections (1)(a)
             139      and (b).
             140          [(d)] (e) (i) If duplicate notices of commencement are filed, they shall be combined
             141      into one notice for each project and any notices filed relate back to the date of the earliest-filed


             142      notice of commencement for the project.
             143          (ii) A duplicate notice of commencement that is untimely filed relates back under
             144      Subsection (1)[(d)](e)(i) if the earlier filed notice of commencement is timely filed.
             145          (iii) Duplicate notices of commencement shall be automatically linked by the
             146      designated agent.
             147          [(e)] (f) The designated agent shall assign each construction project a unique project
             148      number that:
             149          (i) identifies each construction project; and
             150          (ii) can be associated with all notices of commencement, preliminary notices, and
             151      notices of completion.
             152          [(f)] (g) A notice of commencement is effective only as to any labor, service,
             153      equipment, and material furnished to the construction project that is furnished subsequent to
             154      the filing of the notice of commencement.
             155          (2) (a) A notice of commencement shall include the following:
             156          (i) the name and address of the owner of the project;
             157          (ii) the name and address of the:
             158          (A) original contractor; and
             159          (B) surety providing any payment bond for the project, or if none exists, a statement
             160      that a payment bond was not required for the work being performed; and
             161          (iii) (A) the project address if the project can be reasonably identified by an address;
             162      or
             163          (B) the name and general description of the location of the project if the project cannot
             164      be reasonably identified by an address.
             165          (b) A notice of commencement may include:
             166          (i) a general description of the project; or
             167          (ii) the lot or parcel number, and any subdivision, development, or other project name,
             168      of the real property upon which the project is to be constructed if the project is subject to
             169      mechanics' liens.


             170          (c) A notice of commencement need not include all of the items listed in Subsection
             171      (2)(a) if:
             172          (i) a building permit is issued for the project; and
             173          (ii) all items listed in Subsection (2)(a) that are available on the building permit are
             174      included in the notice of commencement.
             175          (3) If a notice of commencement for a construction project is not filed within the time
             176      set forth in Subsections(1)(a) and (b), the following do not apply:
             177          (a) Section 38-1-32 ; and
             178          (b) Section 38-1-33 .
             179          (4) (a) Unless a person indicates to the division or designated agent that the person
             180      does not wish to receive a notice under this section, electronic notice of the filing of a notice of
             181      commencement or alternate notice as prescribed in Subsection (1), shall be provided to:
             182          (i) all persons who have filed notices of commencement for the project; and
             183          (ii) all interested persons who have requested notices concerning the project.
             184          (b) (i) A person to whom notice is required under Subsection (4)(a) is responsible for:
             185          (A) providing an e-mail address, mailing address, or telefax number to which a notice
             186      required by Subsection (4)(a) is to be sent; and
             187          (B) the accuracy of any e-mail address, mailing address, or telefax number to which
             188      notice is to be sent.
             189          (ii) The designated agent fulfills the notice requirement of Subsection (4)(a) when it
             190      sends the notice to the e-mail address, mailing address, or telefax number provided to the
             191      designated agent whether or not the notice is actually received.
             192          (5) (a) The burden is upon any person seeking to enforce a notice of commencement to
             193      verify the accuracy of information in the notice of commencement and prove that the notice of
             194      commencement is filed timely and meets all of the requirements in this section.
             195          (b) A substantial inaccuracy in a notice of commencement renders the notice of
             196      commencement unenforceable.
             197          (c) A person filing a notice of commencement by alternate filing is responsible for


             198      verifying and changing any incorrect information in the notice of commencement before the
             199      expiration of the time period during which the notice is required to be filed.
             200          (6) At the time a building permit is obtained, each original contractor shall
             201      conspicuously post at the project site a copy of the building permit obtained for the project.
             202          Section 3. Section 38-1-32 is amended to read:
             203           38-1-32. Preliminary notice by subcontractor.
             204          (1) (a) (i) Except for a person who has a contract with an owner or an owner-builder or
             205      a laborer compensated with wages, a subcontractor shall file a preliminary notice with the
             206      database [within the later of] by the later of:
             207          (A) 20 days after commencement of its own work or the commencement of furnishing
             208      labor, service, equipment, and material to a construction project; or
             209          (B) 20 days after the filing of a notice of commencement if the subcontractor's work
             210      commences before the filing of the first notice of commencement.
             211          (ii) A preliminary notice filed within the period described in Subsection (1)(a)(i) is
             212      effective as to all labor, service, equipment, and material furnished to the construction project,
             213      including labor, service, equipment, and material provided to more than one contractor or
             214      subcontractor.
             215          (iii) (A) If more than one notice of commencement is filed for a project, a person may
             216      attach a preliminary notice to any [of the notices] notice of commencement filed for the
             217      project by a party authorized in Section 38-1-31 .
             218          (B) A preliminary notice attached to an untimely notice of commencement is valid if
             219      there is also a valid and timely notice of commencement for the project [to which the
             220      preliminary notice may attach] filed by a party authorized in Section 38-1-31 .
             221          (b) If a person files a preliminary notice after the period prescribed by Subsection
             222      (1)(a), the preliminary notice becomes effective five days after the day on which the
             223      preliminary notice is filed.
             224          (c) Except as provided in Subsection (1)(e), failure to file a preliminary notice within
             225      the period required by Subsection (1)(a) precludes a person from maintaining any claim for


             226      compensation earned for performance of labor or service or supply of materials or equipment
             227      furnished to the construction project before the expiration of five days after the late filing of a
             228      preliminary notice, except as against the person with whom the person contracted.
             229          (d) (i) (A) If a person who is required to file a preliminary notice under this chapter
             230      fails to file the preliminary notice, that person may not hold a valid lien under this chapter.
             231          (B) A county recorder need not verify that a valid preliminary notice is filed when a
             232      person files a notice to hold and claim a lien under Section 38-1-7 .
             233          (ii) The content of a preliminary notice shall include:
             234          (A) the building permit number for the project, or the number assigned to the project
             235      by the designated agent;
             236          (B) the name, address, and telephone number of the person furnishing the labor,
             237      service, equipment, or material;
             238          (C) the name and address of the person who contracted with the claimant for the
             239      furnishing of the labor, service, equipment, or material;
             240          (D) the name of the record or reputed owner of the project;
             241          (E) the name of the original contractor under which the claimant is performing or will
             242      perform its work; and
             243          (F) the address of the project or a description of the location of the project.
             244          (iii) Upon request by person identified in Subsection (1)(a)(i), an original contractor
             245      shall provide the person with the building permit number for the project, or the number
             246      assigned to the project by the designated agent.
             247          (e) If a person provides labor, service, equipment, or material before the filing of a
             248      notice of commencement and the notice of commencement is filed more than 15 days after the
             249      day on which the person providing labor, service, equipment, or material begins work on the
             250      project, the person providing labor, service, equipment, or material need not file a preliminary
             251      notice to maintain the person's right to hold a lien under this chapter or any other right,
             252      including a right referenced under Subsection (1)(c).
             253          (2) (a) (i) Unless a person indicates to the division or designated agent that the person


             254      does not wish to receive a notice under this section, electronic notification of the filing of a
             255      preliminary notice or alternate notice as prescribed in Subsection (1), shall be provided to:
             256          (A) the person filing the preliminary notice;
             257          (B) each person that filed a notice of commencement for the project; and
             258          (C) all interested persons who have requested notices concerning the project.
             259          (ii) A person to whom notice is required under Subsection (2)(a)(i) is responsible for:
             260          (A) providing an e-mail address, mailing address, or telefax number to which a notice
             261      required by Subsection (2)(a) is to be sent; and
             262          (B) the accuracy of any e-mail address, mailing address, or telefax number to which
             263      notice is to be sent.
             264          (iii) The designated agent fulfills the notice requirement of Subsection (2)(a)(i) when
             265      it sends the notice to the e-mail address, mailing address, or telefax number provided to the
             266      designated agent whether or not the notice is actually received.
             267          (b) The burden is upon the person filing the preliminary notice to prove that the person
             268      has substantially complied with the requirements of this section.
             269          (c) Subject to Subsection [(1)] (2)(d), a person required by this section to give
             270      preliminary notice is only required to give one notice for each project.
             271          (d) If the labor, service, equipment, or material is furnished pursuant to contracts
             272      under more than one original contract, the notice requirements must be met with respect to the
             273      labor, service, equipment, or material furnished under each original contract.
             274          (3) (a) If a construction project owner, original contractor, subcontractor, or other
             275      interested person believes that a preliminary notice has been filed erroneously, that owner,
             276      original contractor, subcontractor, or other interested person can request from the person who
             277      filed the preliminary notice evidence establishing the validity of the preliminary notice.
             278          (b) Within ten days after the request described in Subsection (3)(a), the person or
             279      entity that filed the preliminary notice shall provide the requesting person or entity proof that
             280      the preliminary notice is valid.
             281          (c) If the person or entity that filed the preliminary notice does not provide proof of the


             282      validity of the preliminary notice, that person or entity shall immediately cancel the
             283      preliminary notice from the database in any manner prescribed by the division pursuant to
             284      rule.
             285          (4) A person filing a preliminary notice by alternate filing is responsible for verifying
             286      and changing any incorrect information in the preliminary notice before the expiration of the
             287      time period during which the notice is required to be filed.
             288          (5) Until June 1, 2008, nothing in this section affects a person's rights under Title 38,
             289      Chapter 11, Residence Lien Restriction and Lien Recovery Fund Act.
             290          Section 4. Section 58-56-19 is amended to read:
             291           58-56-19. Standardized building permit numbering.
             292          (1) As used in this section, "project" means a "construction project" as defined in
             293      Section 38-1-27 .
             294          (2) [Upon recommendation by the commission, the] The division shall develop a
             295      standardized building permit numbering system for use by any compliance agency in the state
             296      that issues a permit for construction.
             297          (3) (a) Beginning on [January 1, 2007, any] July 1, 2009, a compliance agency issuing
             298      a permit for construction shall use the standardized building permit numbering system
             299      [developed] described under Subsection (2).
             300          (b) [Notwithstanding Subsection (3)(a), a] A compliance agency may not use [a
             301      different] a numbering system [if that numbering system is used in addition to] other than the
             302      system [developed] described under Subsection (2) to define a building permit number.
             303          (4) The standardized building permit numbering system [developed] described under
             304      Subsection (2) shall include[:] a combination of alpha or numeric characters arranged in a
             305      format acceptable to the compliance agency.
             306          [(a) three alphabetical characters identifying the compliance agency issuing the
             307      permit;]
             308          [(b) two numeric digits indicating the day of the month on which the permit is issued;]
             309          [(c) two numeric digits indicating the month in which the permit is issued;]


             310          [(d) two numeric digits indicating the last two digits of the year in which the permit is
             311      issued; and]
             312          [(e) three numeric digits indicating the serialized number of the permit issued on a
             313      given day.]
             314          Section 5. Section 58-56-20 is amended to read:
             315           58-56-20. Standardized building permit content.
             316          (1) [After receiving a recommendation from the commission, the] In accordance with
             317      Title 63G, Chapter 3, Utah Administrative Rulemaking Act, the division shall adopt a
             318      standardized building permit form by rule.
             319          (2) (a) The standardized building permit form created under Subsection (1) shall
             320      include fields for indicating the following information:
             321          (i) the name and address of the owner of or contractor for the project;
             322          (ii) (A) the address of the project; or
             323          (B) a general description of the project; and
             324          (iii) whether the permit applicant is an original contractor or owner-builder.
             325          (b) The standardized building permit form created under Subsection (1) may include
             326      any other information the division considers useful.
             327          (3) (a) A compliance agency shall issue a permit for construction only on a
             328      standardized building permit form approved by the division.
             329          (b) A permit for construction issued by a compliance agency under Subsection (3)(a)
             330      shall print the standardized building permit number assigned under Section 58-56-19 in the
             331      upper right-hand corner of the building permit form in at least 12-point type.
             332          (c) (i) Except as provided in Subsection (3)(c)(ii), a compliance agency may not issue
             333      a permit for construction if the information required by Subsection (2)(a) is not completed on
             334      the building permit form.
             335          (ii) If a compliance agency does not issue a separate permit for different aspects of the
             336      same project, the compliance agency may issue a permit for construction without the
             337      information required by Subsection (2)(a)(iii).


             338          (d) A compliance agency may require additional information for the issuance of a
             339      permit for construction.


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