SENATE BILL No. 406
April 19, 2001, Introduced by Senator SCHUETTE and referred to the Committee on
Judiciary.
A bill to amend 1980 PA 497, entitled
"Construction lien act,"
by amending section 110 (MCL 570.1110), as amended by 1982 PA
17.
THE PEOPLE OF THE STATE OF MICHIGAN ENACT:
1 Sec. 110. (1) A contractor shall provide a sworn statement
2 to the owner or lessee in each of the following circumstances:
3 (a) When payment is due to the contractor from the owner or
4 lessee or when the contractor requests payment from the owner or
5 lessee.
6 (b) When a demand for the sworn statement has been made by
7 or on behalf of the owner or lessee.
8 (2) A subcontractor shall provide a sworn statement to the
9 owner or lessee when a demand for the sworn statement has been
10 made by or on behalf of the owner or lessee.
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1 (3) A subcontractor shall provide a sworn statement to the
2 contractor when payment is due to the subcontractor from the con-
3 tractor or when the subcontractor requests payment from the
4 contractor.
5 (4) The sworn statement shall list each subcontractor and
6 supplier with whom the person issuing the sworn statement has
7 contracted relative to the improvement to the real property. The
8 sworn statement shall contain a list of laborers with whom the
9 person issuing the sworn statement has contracted relative to the
10 improvement to the real property and for whom payment for wages
11 or fringe benefits and withholdings are due but unpaid and the
12 itemized amount of such wages or fringe benefits and
13 withholdings. The sworn statement shall be in substantially the
14 following form:
15
16 SWORN STATEMENT
17 State of Michigan)
18 ) ss.
19 County of .......)
20 ............
(DEPONENT), being
duly sworn,
deposes and
21 says
STATES THE
FOLLOWING:
22 That
......... is the
(contractor)
(subcontractor) for
an
23 improvement to
the following
described real
property situated
24 in ............ County, Michigan, described as follows:
25 .................................................................
26 (insert legal description of property)
27 That the
THE following is a
statement of each
28 subcontractor and
supplier, and
laborer , for
which laborer
29 the WHOM
payment
of wages or fringe
benefits and
withholdings is
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1 due but unpaid, with whom the (contractor) (subcontractor) has
2 (contracted) (subcontracted) for performance under the contract
3 with the owner or
lessee thereof OF
THE PROPERTY, and
that
4 the amounts due
to the persons as of
the date hereof OF
THIS
5 STATEMENT are correctly and fully set forth opposite their names:
6 , as follows:
7 Amount of
8 laborer
9 Name of fringe
10 subcon- Balance Amount of benefits
11 tractor, Type of to laborer and with-
12 supplier, improve- Total Amount Amount completewages due holdings
13 or ment contract already currently (op- but due but
14 laborer furnished price paid owing tional) unpaid unpaid
15 ...........................................................................
16 Totals
17 (Some columns are not applicable to all persons listed)
18 That the
THE contractor has
not procured
material from, or
19 subcontracted
with, any person
other than those set
forth above
20 and owes no money for the improvement other than the sums set
21 forth. above.
22 Deponent
further says that he
or she makes the
foregoing I
23 MAKE THIS statement as the (contractor) (subcontractor) or as
24 ......... of the
(contractor)
(subcontractor) for
the purpose of
25 representing
TO
REPRESENT to the
owner or lessee of
the
26 above-described
premises PROPERTY
and his or her
agents that
27 the above-described
property
is free from claims
of construc-
28 tion liens, or the possibility of construction liens, except as
29 specifically set
forth above IN
THIS STATEMENT and
except for
30 claims of
construction liens
by laborers which
THAT may be
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1 provided
pursuant to UNDER
section 109 of the
construction lien
2 act, Act No. 497
of the Public Acts
of 1980, as amended,
being
3 section 570.1109
of the Michigan
Compiled Laws 1980
PA 497, MCL
4 570.1109.
5 WARNING TO OWNER OR LESSEE: AN OWNER OR LESSEE OF THE
6 ABOVE-DESCRIBED
PROPERTY MAY NOT
RELY ON THIS SWORN
STATEMENT
7 TO AVOID THE CLAIM OF A SUBCONTRACTOR, SUPPLIER, OR LABORER WHO
8 HAS PROVIDED A NOTICE OF FURNISHING OR A LABORER WHO MAY PROVIDE
9 A NOTICE OF
FURNISHING PURSUANT
TO UNDER SECTION
109 OF THE
10 CONSTRUCTION LIEN ACT, 1980 PA 497, MCL 570.1109, TO THE DESIGNEE
11 OR TO THE OWNER OR LESSEE IF THE DESIGNEE IS NOT NAMED OR HAS
12 DIED.
13 .............................
14 Deponent
15 WARNING TO
DEPONENT: A PERSON
, WHO WITH INTENT
TO
16 DEFRAUD,
GIVES A
FALSE SWORN
STATEMENT WITH
INTENT TO DEFRAUD IS
17 SUBJECT TO CRIMINAL PENALTIES AS PROVIDED IN SECTION 110 OF THE
18 CONSTRUCTION LIEN
ACT, ACT NO. 497 OF
THE PUBLIC ACTS OF
1980,
19 AS AMENDED,
BEING
SECTION 570.1110 OF
THE MICHIGAN
COMPILED LAWS
20 1980 PA 497, MCL 570.1110.
21 Subscribed and
sworn to before me
ON this ...... day
of
22 ..........,
19....
....................... (DATE)
23 .............................................
24 Notary Public, ........ County, Michigan.
25 My commission expires: .......................... .
26 (5) The
contractor or
subcontractor shall
IS not be
27 required to list in the sworn statement material furnished by the
28 contractor or
subcontractor out of
his or her own
inventory ,
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1 and which has
THAT WAS not been
purchased
specifically for
2 the purpose of
performing the
contract.
3 (6) After the contractor or subcontractor provides the sworn
4 statement, the owner or lessee may withhold or, upon written
5 demand from the
contractor shall
withhold, from the
amount which
6 is due or to
become due to the
contractor or to the
subcontrac-
7 tor for work
already performed ,
an amount
sufficient to pay
8 all sums which
are due to
subcontractors, or
to suppliers, or
9 to laborers,
as
shown by the sworn
statement, or which
is due
10 to lien claimants who have provided a notice of furnishing
11 pursuant to
UNDER section 109.
From the amount
withheld, the
12 owner or lessee may directly pay subcontractors, suppliers, or
13 laborers the amount they are due as shown by the sworn
14 statement. If the contract provides for payments by the owner to
15 the general
contractor , if
any, in the normal
course of con-
16 struction, but the owner elects to pay lien claimants directly
17 pursuant to
UNDER this section,
the first time the
owner elects
18 to make payment directly to a lien claimant, he or she shall pro-
19 vide at least 5 business days' notice to the general contractor
20 of the intention to make direct payment. Subsequent direct dis-
21 bursements to lien claimants need not be preceded by the 5-day
22 notice provided in this section unless the owner first returns to
23 the practice of paying all sums to the general contractor. As
24 between the owner or lessee and the contractor or subcontractor,
25 all payments made
pursuant to UNDER
this subsection
shall be
26 ARE considered the same as if paid directly to the contractor or
27 subcontractor.
If an amount is
withheld pursuant
to UNDER this
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1 subsection from the contractor or subcontractor, the owner or
2 lessee, upon request, shall prepare and provide to the contractor
3 or subcontractor an itemized statement of the sums withheld. If
4 an amount is paid
directly to a lien
claimant pursuant
to UNDER
5 this section, the owner or lessee shall, if requested by the con-
6 tractor or subcontractor, provide to the contractor or subcon-
7 tractor an itemized statement of the sums paid.
8 (7) An owner, lessee, designee, mortgagee, or contractor may
9 rely on a sworn statement prepared by a party other than himself
10 or herself to avoid the claim of a subcontractor, supplier, or
11 laborer unless the subcontractor, supplier, or laborer has pro-
12 vided a notice of
furnishing as
required by UNDER
section 109
13 or unless the
notice of furnishing
is excused pursuant
to UNDER
14 section 108 or 108a.
15 (8) If a contractor fails to provide a sworn statement to
16 the owner or
lessee prior to the
BEFORE recording
of the
17 contractor's claim of lien, the contractor's construction lien
18 shall IS not
be invalid.
However, the
contractor shall
IS
19 not be
entitled
to any payment, and
a complaint, cross-claim,
20 or counterclaim may not be filed to enforce the construction
21 lien, until the sworn statement has been provided.
22 (9) If a subcontractor fails to provide a sworn statement
23 pursuant to
UNDER subsection (2)
to the owner or
lessee prior
24 to the
BEFORE
recording of the
subcontractor's
claim of lien,
25 the
subcontractor's
construction lien
shall not be invalid
IS
26 VALID. However, a complaint, cross-claim, or counterclaim may
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1 not be filed to enforce the construction lien until the sworn
2 statement has been provided.
3 (10) A
contractor or
subcontractor who ,
with intent to
4 defraud,
DESIRES
TO DRAW MONEY AND
gives or causes to
be given
5 to any owner or
lessee , when he or
she desires to draw
money,
6 a sworn statement
as required by
this section ,
which THAT is
7 in fact
false,
WITH INTENT TO
DEFRAUD, is guilty
of a
8 misdemeanor if
CRIME AS FOLLOWS:
9 (A) IF the
statement involved
is for $100.00 or
less and
10 a felony if it is
for more than
$100.00 THAN
$200.00, THE CON-
11 TRACTOR OR SUBCONTRACTOR IS GUILTY OF A MISDEMEANOR PUNISHABLE BY
12 IMPRISONMENT FOR NOT MORE THAN 93 DAYS OR A FINE OF NOT MORE THAN
13 $500.00 OR 3 TIMES THE STATEMENT AMOUNT, WHICHEVER IS GREATER, OR
14 BOTH IMPRISONMENT AND A FINE.
15 (B) IF ANY OF THE FOLLOWING APPLY, THE CONTRACTOR OR SUBCON-
16 TRACTOR IS GUILTY OF A MISDEMEANOR PUNISHABLE BY IMPRISONMENT FOR
17 NOT MORE THAN 1 YEAR OR A FINE OF NOT MORE THAN $2,000.00 OR 3
18 TIMES THE STATEMENT AMOUNT, WHICHEVER IS GREATER, OR BOTH IMPRIS-
19 ONMENT AND A FINE:
20 (i) THE STATEMENT INVOLVED IS FOR $200.00 OR MORE BUT LESS
21 THAN $1,000.00.
22 (ii) THE CONTRACTOR OR SUBCONTRACTOR VIOLATES SUBDIVISION
23 (A) AND HAS 1 OR MORE PRIOR CONVICTIONS FOR COMMITTING OR
24 ATTEMPTING TO COMMIT AN OFFENSE UNDER THIS ACT.
25 (C) IF ANY OF THE FOLLOWING APPLY, THE CONTRACTOR OR SUBCON-
26 TRACTOR IS GUILTY OF A FELONY PUNISHABLE BY IMPRISONMENT FOR NOT
27 MORE THAN 5 YEARS OR A FINE OF NOT MORE THAN $10,000.00 OR 3
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1 TIMES THE STATEMENT AMOUNT, WHICHEVER IS GREATER, OR BOTH
2 IMPRISONMENT AND A FINE:
3 (i) THE STATEMENT INVOLVED IS FOR $1,000.00 OR MORE BUT LESS
4 THAN $20,000.00.
5 (ii) THE CONTRACTOR OR SUBCONTRACTOR VIOLATES
6 SUBDIVISION (B)(i) AND HAS 1 OR MORE PRIOR CONVICTIONS FOR VIO-
7 LATING OR ATTEMPTING TO VIOLATE THIS ACT. FOR PURPOSES OF THIS
8 SUBPARAGRAPH, HOWEVER, A PRIOR CONVICTION DOES NOT INCLUDE A CON-
9 VICTION FOR VIOLATING OR ATTEMPTING TO VIOLATE SUBDIVISION (A) OR
10 (B)(ii).
11 (D) IF ANY OF THE FOLLOWING APPLY, THE CONTRACTOR OR SUBCON-
12 TRACTOR IS GUILTY OF A FELONY PUNISHABLE BY IMPRISONMENT FOR NOT
13 MORE THAN 10 YEARS OR A FINE OF NOT MORE THAN $15,000.00 OR 3
14 TIMES THE STATEMENT AMOUNT, WHICHEVER IS GREATER, OR BOTH IMPRIS-
15 ONMENT AND A FINE:
16 (i) THE STATEMENT INVOLVED IS FOR $20,000.00 OR MORE.
17 (ii) THE CONTRACTOR OR SUBCONTRACTOR VIOLATES
18 SUBDIVISION (C)(i) AND HAS 2 OR MORE PRIOR CONVICTIONS FOR COM-
19 MITTING OR ATTEMPTING TO COMMIT AN OFFENSE UNDER THIS ACT. FOR
20 PURPOSES OF THIS SUBPARAGRAPH, HOWEVER, A PRIOR CONVICTION DOES
21 NOT INCLUDE A CONVICTION FOR VIOLATING OR ATTEMPTING TO VIOLATE
22 SUBDIVISION (A) OR (B)(ii).
23 (11) STATEMENTS INVOLVED IN SEPARATE INCIDENTS PURSUANT TO A
24 SCHEME OR COURSE OF CONDUCT WITHIN ANY 12-MONTH PERIOD MAY BE
25 AGGREGATED TO DETERMINE THE TOTAL AMOUNT INVOLVED IN THE
26 STATEMENTS.
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1 (12) IF THE PROSECUTING ATTORNEY INTENDS TO SEEK AN ENHANCED
2 SENTENCE BASED UPON THE DEFENDANT HAVING 1 OR MORE PRIOR
3 CONVICTIONS, THE PROSECUTING ATTORNEY SHALL INCLUDE ON THE COM-
4 PLAINT AND INFORMATION A STATEMENT LISTING THE PRIOR CONVICTION
5 OR CONVICTIONS. THE EXISTENCE OF THE DEFENDANT'S PRIOR CONVIC-
6 TION OR CONVICTIONS SHALL BE DETERMINED BY THE COURT, WITHOUT A
7 JURY, AT SENTENCING OR AT A SEPARATE HEARING FOR THAT PURPOSE
8 BEFORE SENTENCING. THE EXISTENCE OF A PRIOR CONVICTION MAY BE
9 ESTABLISHED BY ANY EVIDENCE RELEVANT FOR THAT PURPOSE, INCLUDING,
10 BUT NOT LIMITED TO, 1 OR MORE OF THE FOLLOWING:
11 (A) A COPY OF THE JUDGMENT OF CONVICTION.
12 (B) A TRANSCRIPT OF A PRIOR TRIAL, PLEA-TAKING, OR
13 SENTENCING.
14 (C) INFORMATION CONTAINED IN A PRESENTENCE REPORT.
15 (D) THE DEFENDANT'S STATEMENT.
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