Sections 52-125 to 52-159 shall be known and may be cited as the Nebraska Construction Lien Act.

Annotations

Trustees of a health, welfare, and pension fund may assert a construction lien on behalf of union employees against the property owner. Omaha Constr. Indus. Pension Plan v. Children's Hosp., 11 Neb. App. 35, 642 N.W.2d 849 (2002).

Sections 52-125 to 52-159 creates, and provides for the attachment and enforceability of, a lien against real estate in favor of a person furnishing services or materials under a real estate improvement contract. Except as provided in sections 52-125 to 52-159, no nonconsensual lien arises against real estate by reason of improvements made thereon.

Annotations

The Nebraska Construction Lien Act does not take away a construction lienholder's common-law right to sue for breach of contract. Tilt-Up Concrete, Inc. v. Star City/Federal, Inc., 261 Neb. 64, 621 N.W.2d 502 (2001).

(1) Claimant shall mean a person having a right to a lien under sections 52-125 to 52-159 upon real estate and includes his or her successor in interest;

(2) Contract price shall mean the amount agreed upon by the contracting parties for performing services and furnishing materials covered by the contract, increased or diminished by the price of change orders or extras, amounts attributable to altered specifications, or breach of contract, including but not limited to defects in workmanship or materials. Liquidation of damages between the owner and a prime contractor does not diminish the contract price as to other claimants. If no price is agreed upon by the contracting parties, contract price shall mean the reasonable value of all services or materials covered by the contract;

(3) Contracting owner shall mean a person who owns real estate and who, personally or through an agent, enters into a contract, express or implied, for the improvement of the real estate;

(4) Construction lien or lien shall mean a lien arising under sections 52-125 to 52-159, and shall not include a security interest;

(5) Notice of commencement shall mean the notice specified in section 52-145, whether recorded by an owner or by a claimant;

(6) Notice of termination shall mean a notice terminating a notice of commencement;

(7) Prime contract shall mean any real estate improvement contract made between the contracting owner and a prime contractor;

(8) Prime contractor shall mean any person who makes a real estate improvement contract with a contracting owner;

(9) Services shall not include financing or activities in connection with financing;

(10) Construction security interest shall mean a security interest created by a security agreement that contains a legend on the first page clearly stating that it is a Construction Security Agreement and that secures an obligation which the debtor incurred for the purpose of making an improvement of the real estate in which the security interest is given if the instrument recorded to perfect the interest states that it is a construction security interest;

(11) Good faith shall mean honesty in fact and the observance of reasonable standards of fair dealing in the conduct or transaction involved;

(12) Judicial proceeding shall mean action at law or suit in equity, and any other proceeding in which rights are judicially determined;

(13) To record shall mean to present to the register of deeds for the county where the land is situated a document which he or she accepts and either enters in a daily log or notes thereon an identifying number, regardless of whether under applicable law the register of deeds is directed to file the document or otherwise to maintain a record of it. Recorded and recording have corresponding meanings;

(14) Record location shall mean the location, whether book and page, document number, electronic retrieval code, or other specific place, of a document in the public records accessible in the same recording office where the document containing the reference to the location is found; and

(15) Security interest shall mean a consensual interest in real estate which secures payment or performance of an obligation.

Annotations

"Real estate" means an estate or interest in, over, or under land, including minerals, structures, fixtures, and other things that by custom, usage, or law, pass with a conveyance of land, though not described or mentioned in the contract of sale or instrument of conveyance and, if appropriate to the context, the land in which the interest is claimed. The term includes rents and the interest of a landlord or tenant. Nore Electric v. S & H Holdings, 316 Neb. 197, 3 N.W.3d 895 (2024).
The word "owner" is not limited in its meaning to an owner of the fee but means the owner of any interest in the lands and includes every character of title, whether legal or equitable, fee simple, or leasehold. Nore Electric v. S & H Holdings, 316 Neb. 197, 3 N.W.3d 895 (2024).
A potential purchaser's interest in a property does not satisfy the requirements of "contracting owner" under subsection (3) of this section, and, therefore, potential purchasers cannot limit their liability under subsection (5) of section 52-136 for construction liens properly recorded before the filing of their own title document. Lincoln Lumber Co. v. Lancaster, 260 Neb. 585, 618 N.W.2d 676 (2000).
Vendor of real estate held not to be "contracting owner," where the executory contract did not require construction of improvements ordered by purchaser necessary to subject the vendor's interest in the property to a construction lien filed by supplier. Tuttle & Assoc. v. Gendler, 237 Neb. 825, 467 N.W.2d 881 (1991).

For the purpose of determining whether an owner is a contracting owner, agency is presumed, in the absence of clear and convincing evidence to the contrary, between employer and employee, between spouses, between joint tenants, and among tenants in common.

(a) An individual who contracts to give a real estate security interest in, or to buy or to have improved, residential real estate all or a part of which he or she occupies or intends to occupy as a residence;

(b) A person obligated primarily or secondarily on a contract to buy or have improved residential real estate or on an obligation secured by residential real estate if, at the time he or she becomes obligated, he or she is related to an individual who occupies or intends to occupy all or a part of the real estate as a residence; or

(c) With respect to a security agreement, a person who acquires residential real estate and assumes or takes subject to the obligation of a prior protected party under the real estate security agreement.

(2) Residential real estate shall mean, in relation to a protected party, real estate, improved or to be improved, containing not more than four dwelling units and no nonresidential uses for which the protected party is a lessor. A condominium unit that is otherwise residential real estate remains so even though the condominium development contains more than four dwelling units or units used for nonresidential purposes.

Annotations

One must intend to occupy the real estate as a residence to be considered a protected party. Midlands Rental & Mach., Inc. v. Christensen Ltd., 252 Neb. 806, 566 N.W.2d 115 (1997).

(1) Except as provided in subsection (2) of this section, real estate improvement contract shall mean an agreement to perform services, including labor, or to furnish materials for the purpose of producing a change in the physical condition of land or of a structure including:

(a) Alteration of the surface by excavation, fill, change in grade, or change in a shore, bank, or flood plain of a stream, swamp, or body of water;

(f) Preparation of plans, surveys, or architectural or engineering plans or drawings for any change in the physical condition of land or structures whether or not used incident to producing a change in physical condition of the real estate.

(2) A contract for the mining or removal of timber, minerals, gravel, soil, sod, or things growing on land, or other similar contracts in which the activity is primarily for the purpose of realizing upon the disposal or removal of the objects removed, or a contract for the planting, cultivation, or harvesting of crops or for the preparation of the soil for planting of crops, is not a real estate improvement contract.

Annotations

General cleanup activities in preparation for sale of property are inconsistent with the property changes contemplated and required by this section for a valid construction lien. Taylor v. Taylor, 277 Neb. 617, 764 N.W.2d 101 (2009).

(1) A person who furnishes services or materials pursuant to a real estate improvement contract has a construction lien, only to the extent provided in the Nebraska Construction Lien Act, to secure the payment of his or her contract price.

(2) A lien arises under the act only if the claimant records a lien within the time specified by section 52-137.

(3) Real estate to which a construction lien attaches is specified by section 52-133, and limitations on the existence of a lien for materials are specified by section 52-134.

(4) The amount of a claimant's lien is specified by section 52-136. The content of the notice of the right to assert a lien to be given to the owner under section 52-136 is specified by section 52-135.

(5) The priority of a claimant's lien as against other construction-lien claimants is specified in section 52-138, and priority as against claimants other than construction-lien claimants is specified in section 52-139.

(6) Foreclosure of a lien under the act is governed by section 52-155, and the time within which an action to foreclose must be brought by section 52-140.

Annotations

A construction lien is automatically created whenever a contractor furnishes services or materials and originates from the contracting owner's entering into the improvement contract even though it has not yet attached to the real estate and is not yet enforceable. Nore Electric v. S & H Holdings, 316 Neb. 197, 3 N.W.3d 895 (2024).
The time specified by section 52-‍137 is after entering into the real estate improvement contract and not later than 120 days after the contractor's final furnishing of services or materials. Nore Electric v. S & H Holdings, 316 Neb. 197, 3 N.W.3d 895 (2024).
A construction lien is not valid absent a contract between the parties. Mid-America Maintenance v. Bill Morris Ford, 232 Neb. 920, 442 N.W.2d 869 (1989).
The Nebraska Construction Lien Act does not prevent employees of a subcontractor from filing a construction lien against the property owner. Omaha Constr. Indus. Pension Plan v. Children's Hosp., 11 Neb. App. 35, 642 N.W.2d 849 (2002).
A construction lien is not valid absent a contract between the parties. Sorenson v. Dager, 8 Neb. App. 729, 601 N.W.2d 564 (1999).

Notwithstanding the provisions on existence of a construction lien of section 52-131, no lien attaches under sections 52-125 to 52-159 to real estate owned by the state, a county, a municipality, or other governmental agency or political subdivision.

(1) If at the time a construction lien is recorded there is a recorded notice of commencement covering the improvement pursuant to which the lien arises, the lien is on the contracting owner's real estate described in the notice of commencement.

(2) Except as provided in subsection (3) of this section, if at the time a construction lien is recorded there is no recorded notice of commencement covering the improvement pursuant to which the lien arises, the lien is on the contracting owner's real estate being improved or directly benefited.

(3) If a claimant who recorded a lien while there was no recorded notice of commencement covering the real estate later records a notice of commencement, his or her lien is on the contracting owner's real estate described in the notice of commencement.

(4) If as a part of an improvement on his or her real estate or for the purpose of directly benefiting his or her real estate an owner contracts for improvements on real estate not owned by him or her, persons who furnish services or materials in connection with that improvement have a lien against the contracting owner's real estate being improved or directly benefited to the same extent as if the improvement had been on the contracting owner's real estate.

(5) If a recorded notice of commencement covers more than one lot in a platted subdivision of record, a claimant may apportion his or her lien to the various lots covered by the notice of commencement in any proportion he or she chooses and states in his or her recorded lien, including assigning all his or her lien to a particular lot.

(6) If a recorded lien does not contain an apportionment as provided in subsection (5) of this section, the owner may make demand on the claimant to make an apportionment and, if the claimant does not, within thirty days after the demand, make an apportionment by recording an amendment of the recorded lien, the owner may make a good faith apportionment by recording an owner's statement of apportionment. Notwithstanding the fact that the owner did not in fact give the notice to apportion referred to in this subsection or for any other reason was not entitled to record a statement of apportionment, or did not make a good faith apportionment, the apportionment is conclusive in favor of persons acquiring interests in the real estate after the statement of apportionment is recorded.

(a) They are supplied with the intent, shown by the contract of sale, the delivery order, delivery to the site by the claimant or at his or her direction, or by other evidence, that they be used in the course of construction of, or incorporated into, the improvement in connection with which the lien arises; and

(i) Incorporated in the improvement or consumed as normal wastage in construction operations;

(ii) Specially fabricated for incorporation in the improvements and not readily resalable in the ordinary course of the fabricator's business even though not actually incorporated in the improvement;

(iii) Used for the construction or for the operation of machinery or equipment used in the course of construction and not remaining in the improvement, subject to diminution by the salvage value of those materials; or

(iv) Tools, appliances, or machinery used on the particular improvement, but a lien for supplying tools, appliances, or machinery used on the improvement is limited as provided by subsection (3) of this section.

(2) The delivery of materials to the site of the improvement, whether or not by the claimant, creates a presumption that they were used in the course of construction or were incorporated into the improvement.

(3) A lien arising for the supplying of tools, appliances, or machinery under subdivision (1)(b)(iv) of this section is limited as follows:

(a) If they are rented, the lien is for the reasonable rental value for the period of actual use and any reasonable periods of nonuse taken into account in the rental contract; and

(b) If they are purchased, the lien is for the price but arises only if they were purchased for use in the course of the particular improvement and have no substantial value to the purchaser after the completion of the improvement on which they were used.

Annotations

Subsection (3)(a) of this section requires that the reasonable rental value of equipment be determined in setting the amount of a lien, regardless of the monetary amount by which the value of the real estate is actually increased by the use of the rented equipment. Midlands Rental & Mach., Inc. v. Christensen Ltd., 252 Neb. 806, 566 N.W.2d 115 (1997).
Testimony of a witness with personal knowledge is sufficient evidence to demonstrate that items listed on a construction lien were actually used. Mid-America Maintenance v. Bill Morris Ford, 232 Neb. 920, 442 N.W.2d 869 (1989).

(1) At any time after a claimant has entered into the contract under which he or she may claim a lien under the Nebraska Construction Lien Act, he or she may give notice of the right to assert a lien to the contracting owner. The notice of the right to assert a lien must be in writing, state that it is a notice of a right to assert a lien against real estate for services or materials furnished in connection with improvement of the real estate, and contain:

(a) The name of the claimant and the address to which the owner or others may send communications to the claimant;

(d) A general description of the services or materials provided or to be provided;

(e) A description sufficient to identify the real estate against which the lien is or may be claimed;

(g) The amount unpaid to the claimant for services or materials, whether or not due, or if no amount is fixed by the contract, a good faith estimate of the amount designated as an estimate; and

(h) The following statement in type no smaller than that used in providing the information required by subdivisions (1)(a) through (1)(g) of this subsection:

Warning. If you did not contract with the person giving this notice, any future payments you make in connection with this project may subject you to double liability.

(2) A claimant may notify the contracting owner, either in the notice of the right to assert a lien or separately, that the claimant must be notified of the recording of any termination of the notice of commencement. The notice to the owner must be in writing and, if not part of the notice of the right to assert a lien, shall contain the information specified in subdivisions (1)(a) through (1)(e) of this section. In addition, the notice shall state that a written notice of the recording of any notice of termination must be given to the claimant at least three weeks before the effective date of the notice of termination.

(3) The claimant shall send a copy of a recorded lien to the contracting owner within ten days after recording, and the recording shall be within the time specified for the filing of liens under section 52-137.

(4) If the contracting owner has held out another person as contracting owner, either by naming that person in the notice of commencement or otherwise, a notice directed to and received by that person is effective against the contracting owner.

(5) If the contracting owner has held out a fictitious or nonexisting person as contracting owner either by naming that person in the notice of commencement or otherwise, a notice to that fictitious or nonexisting person delivered at an address held out by the contracting owner as the address of the fictitious or nonexisting person is effective against the contracting owner.

(6) This section shall apply to a lien claimant only when the contracting owner is a protected party.

Annotations

This section applies only to protected parties, and although a party that may eventually claim a lien may, if it so desires, give notice of lien liability to the contracting owner, such notice is not required. Midlands Rental & Mach., Inc. v. Christensen Ltd., 252 Neb. 806, 566 N.W.2d 115 (1997).