Citations Affected: IC 32-8.
Synopsis: Rural telephone cooperative corporations. Allows a no lien
provision or stipulation to be included in a construction contract for the
construction, alteration, or repair of property that is owned, operated,
managed, or controlled by a rural telephone cooperative corporation.
Makes conforming amendments.
Effective: July 1, 2002.
November 20, 2001, read first time and referred to Committee on Rules and Legislative
Procedure.
January 24, 2002, amended; reassigned to Committee on Judiciary.
A BILL FOR AN ACT to amend the Indiana Code concerning
property.
SECTION 1. IC 32-8-3-1, AS AMENDED BY P.L.53-1999, SECTION 1, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2002]: Sec. 1. (a) That contractors, subcontractors, mechanics, lessors leasing construction and other equipment and tools, whether or not an operator is also provided by the lessor, journeymen, laborers and all other persons performing labor or furnishing materials or machinery, including the leasing of equipment or tools used, for the erection, altering, repairing or removing any house, mill, manufactory, or other building, bridge, reservoir, systems of waterworks, or other structures, or for construction, altering, repairing, or removing any walk or sidewalk, whether such walk or sidewalk be on the land or bordering thereon, stile, well, drain, drainage ditch, sewer or cistern or any other earth-moving operation may have a lien separately or jointly upon the house, mill, manufactory or other building, bridge, reservoir, system of waterworks or other structure, sidewalk, walk, stile, well, drain, drainage ditch, sewer or cistern or earth which they may have erected, altered, repaired, moved or removed or for which they may have
furnished materials or machinery of any description, and, on the
interest of the owner of the lot or parcel of land on which it stands or
with which it is connected to the extent of the value of any labor done,
material furnished, or either, including any use of such leased
equipment and tools, and all claims for wages of mechanics and
laborers employed in or about any shop, mill, wareroom, storeroom,
manufactory or structure, bridge, reservoir, system of waterworks or
other structure, sidewalk, walk, stile, well, drain, drainage ditch or
cistern or any other earth-moving operation shall be a lien on all the
machinery, tools, stock or material, work finished or unfinished,
located in or about such shop, mill, wareroom, storeroom, manufactory
or other building, bridge, reservoir, system of waterworks, or other
structure, sidewalk, walk, stile, well, drain, drainage ditch, sewer,
cistern, or earth used in a business.
(b) If the person, firm, limited liability company, or corporation
described in subsection (a) is in failing circumstances, the claims
described in subsection (a) shall be preferred debts whether a claim or
notice of lien has been filed or not.
(c) A provision or stipulation described by this subsection may only
be included in a construction contract for the construction, alteration,
or repair of the following:
(1) A Class 2 structure (as defined in IC 22-12-1-5) or an
improvement on the same real estate auxiliary to a Class 2
structure (as defined in IC 22-12-1-5).
(2) Property that is:
(A) owned, operated, managed, or controlled by a public utility
(as defined in IC 8-1-2-1), municipally owned utility (as
defined in IC 8-1-2-1), joint agency (as defined in
IC 8-1-2.2-2), rural electric membership corporation formed
under IC 8-1-13-4, rural telephone cooperative corporation
formed under IC 8-1-17, or not-for-profit utility (as defined
in IC 8-1-2-125) regulated under IC 8; and
(B) intended to be used and useful for the production,
transmission, delivery, or furnishing of heat, light, water,
telecommunications services, or power to the public.
No provision or stipulation in the contract of the owner and principal
contractor that no lien shall attach to the real estate, building, structure
or any other improvement of the owner shall be valid against
subcontractors, mechanics, journeymen, laborers or persons performing
labor upon or furnishing materials or machinery for such property or
improvement of the owner, unless the contract containing such
provision or stipulation shall be in writing, and shall contain specific
reference, by legal description of the real estate to be improved and
shall be acknowledged as provided in case of deeds and filed and
recorded in the recorder's office of the county in which such real estate,
building, structure or other improvement is situated not more than five
(5) days after the date of execution of such contract. The contract
herein provided for shall be without effect upon labor, material or
machinery supplied prior to the time of the filing with the recorder of
said contract. The recorder shall record such contract at length in the
order of time of its reception in books provided by him for that
purpose, and the recorder shall index the same in the name of the
contractor and in the name of the owner, in books kept for that purpose,
and said recorder shall receive therefor a fee such as is provided for the
recording of deeds and mortgages in his office.
(d) Any person, firm, partnership, limited liability company, or
corporation that sells or furnishes on credit any material, labor or
machinery for the alteration or repair of any owner-occupied single or
double family dwelling or the appurtenances or additions to the
dwelling, to any contractor, subcontractor, mechanic, or anyone other
than the occupying owner or the owner's legal representative shall
furnish to the occupying owner of the parcel of land where the material,
labor or machinery is delivered, a written notice of the delivery or work
and of the existence of lien rights, within thirty (30) days from the date
of first delivery or labor performed. The furnishing of the notice shall
be a condition precedent to the right of acquiring a lien upon the lot or
parcel of land or the improvement on the lot or parcel of land.
(e) Any person, firm, partnership, limited liability company, or
corporation that sells or furnishes on credit any material, labor or
machinery, for the original construction of a single or double family
dwelling for the intended occupancy of the owner upon whose real
estate the construction takes place to any contractor, subcontractor,
mechanic, or anyone other than the owner or the owner's legal
representatives shall furnish the owner of the real estate as named in
the latest entry in the transfer books described in IC 6-1.1-5-4 of the
county auditor, or if IC 6-1.1-5-9 applies, the transfer books of the
township assessor with a written notice of the delivery or labor and the
existence of lien rights within sixty (60) days from the date of the first
delivery or labor performed and shall file a copy of the written notice
in the recorder's office of the county within sixty (60) days from the
date of the first delivery or labor performed. The furnishing of such
notice shall be a condition precedent to the right of acquiring a lien
upon the real estate or upon the improvement constructed on the real
estate.
defined in IC 8-1-2-1), joint agency (as defined in
IC 8-1-2.2-2), rural electric membership corporation formed
under IC 8-1-13-4, rural telephone cooperative corporation
formed under IC 8-1-17, or not-for-profit utility (as defined
in IC 8-1-2-125) regulated under IC 8; and
(B) intended to be used and useful for the production,
transmission, delivery, or furnishing of heat, light, water,
telecommunications services, or power to the public.
(c) An obligor's receipt of payment from a third person shall not be
a condition precedent to, or in any way limit, or be a defense to the
provider's right to record or foreclose a lien against the real estate that
was improved by the provider's labor, material, or equipment.