Michigan Governor Reinstates Prevailing Wage Requirement for DTMB Projects

On October 7, 2021, Governor Gretchen Whitmer announced that she's signed an executive directive instructing the Michigan Department of Technology Management and Budget (DTMB) to require contractors and subcontractors to pay prevailing wages for construction projects in Michigan. The prevailing wage policy will only apply to projects bid out by the DTMB. 

Michigan's Prevailing Wage Act was repealed by the Michigan Legislature on June 6, 2018. 

Watch this space for updates because the Governor's executive action will most certainly be challenged in the courts by non-union contractors and their associations.  

New Bill Would Require Builders to Present License When Recording Construction Lien

On April 20, 2021, Rep. Tommy Brann (R. Wyoming) introduced a new bill, which would require lien claimants to present their contractor's license and drivers license, or attach a copy of them, when recording a construction lien under the Michigan Construction Lien Act. Contractors who violate this requirement would be guilty of a misdemeanor (up to 90 days in jail) and incur a $500 fine.

H.B. 4668 would amend Section 114 of the Construction Lien Act (MCL 570.1114), by adding four new subsections. 

Section 114(2) would require contractors to display (present) their builder's license and some form of personal identification, such as a drivers license, when recording a claim of lien in person.

Section 114(3) would require prohibit a register of deeds from accepting a claim of lien for recording without seeing or attaching a copy of the contractor's license and personal identification to the claim of lien. 

Section 114(4) outlines the penalties for violation. A contractor who violates Section 114 would be guilty of a misdemeanor and face a fine of up to $500, or both. 

Section 114(5) outlines five different forms of "personal identification" that would be acceptable.

Comment: The Michigan Construction Lien Act already includes safeguards against unlicensed builders trying to enforce their construction liens. Section 114a(3) for instance requires that a person who brings an action to enforce a construction lien, who is required to have a license, allege and prove that he (or she) is properly licensed. Section 114a(1) allows an owner of residential property (Homeowner) to bring an action to discharge a construction lien recorded by an unlicensed builder, and recover actual attorney fees and costs.   

For more information about the Michigan Construction Lien Act, contact Peter Cavanaugh or Gary Quesada at (248) 543-8320.  Or visit our website - www.MichiganConstructionLaw.com

How to Discharge an Old Construction Lien in Michigan

In Michigan, a construction lien must be recorded within 90 days after the lien claimant last furnished labor or materials to a project. And a court action to enforce a construction lien must be started within one year of recording.

But what happens after a year if the lien claimant takes no action to enforce their lien? How do you remove an old lien? 

As a practical matter, a lien “expires” after more than one year if the claimant doesn’t file a lawsuit to enforce the lien. But old construction liens aren’t discharged automatically and remain part of the county property records. An old lien can disrupt the sale or refinancing of a property.   

Section 128 of the Michigan Construction Lien Act (MCL 570.1128), however, provides a remedy and a process to discharge an old construction lien.  

Discharging an old construction lien in Michigan is a 3-step process:

1.   Prepare an Affidavit. The affidavit must state your relationship to the property (ie., that you are the fee owner or the agent for the owner), describe the property (parcel number, legal description, and address), and provide information about the lien, including the date it was recorded. 

The property includes the legal description (metes and bounds), the parcel number, and the common street address. This information is included with your property tax bill, but will also be included with the (old) construction lien you’re trying to discharge. 

Attach the construction lien to the affidavit.Have the affidavit notarized. Make a copy.

2.   Submit the Affidavit to the County Clerk. Send the affidavit and a letter to the County Clerk requesting they examine their records; and if no proceedings to enforce the construction lien have been commenced, execute and deliver a certificate of that fact, bearing the seal of the circuit court. Some clerks charge a small fee for preparing the certificate.

3.   Record the Certificate. The certificate issued by the County Clerk, confirming no action was filed to enforce the construction lien within a year of recording, must then be recorded with the Register of Deeds to complete the lien discharge process. An unrecorded certificate is of little value. The recorded certificate discharges the old lien. The Register of Deeds is usually down the hall from the County Clerk. The recording fee is about $30. 

For more information or help with discharging an old construction lien, contact Peter Cavanaugh or Gary Quesada at (248) 543-8320.  Or visit our website - www.MichiganConstructionLaw.com