(1)For the
purposes of this section, the word disburser means any lender who has agreed to
make any loan to the owner or contractor, the proceeds of which are to be
disbursed from time to time as work upon a structure or other improvement
progresses, or any part of which is to be withheld until all or any part of such work
is completed; or, any person who receives funds from any lender, contractor, or
owner to be disbursed from time to time as work upon a structure or other
improvement progresses, or any part of which is to be withheld until all or any part
of such work is completed; or, any owner who has agreed to pay any sum to any
contractor from time to time as work upon a structure or other improvement
progresses, or any part of which is to be withheld until all or any part
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(1) For the
purposes of this section, the word disburser means any lender who has agreed to
make any loan to the owner or contractor, the proceeds of which are to be
disbursed from time to time as work upon a structure or other improvement
progresses, or any part of which is to be withheld until all or any part of such work
is completed; or, any person who receives funds from any lender, contractor, or
owner to be disbursed from time to time as work upon a structure or other
improvement progresses, or any part of which is to be withheld until all or any part
of such work is completed; or, any owner who has agreed to pay any sum to any
contractor from time to time as work upon a structure or other improvement
progresses, or any part of which is to be withheld until all or any part of such work
is completed.
(2) It is the duty of the disburser, prior to the first disbursement, to see that
there has been recorded in the office of the county clerk and recorder of the county
where the land to be improved is situated, a notice stating the name and address of
the owner, the names, addresses, and telephone numbers of the principal
contractor, if any, and the disburser, and the legal description of the land and its
address, if any. One notice may include as many parcels as desired, providing that
all the information is stated as to each parcel. Such notice shall be indexed by the
county clerk and recorder under the name of the owner and each principal
contractor as grantors and according to address.
(3) It is the duty of any person upon ordering or contracting for any labor,
services, machinery, tools, equipment, laborers, or materials to be used as provided
in section 38-22-101, upon demand of the person from whom he or she is so
ordering or with whom he or she is so contracting, to furnish to such person a
statement of the names, addresses, and telephone numbers of the owner or
reputed owner of the land to be improved, the principal contractor, if any, and the
disburser, if any, as defined in subsection (1) of this section, together with a legal
description or the address, if any, of the land to be improved.
(4) Any lien claimant who is entitled to a lien under this article may give
notice to the disburser stating the property by address or legal description, or by
such other description as will identify the real property; the claimant's name,
address, and telephone number; the person with whom he has contracted; and a
general statement of his contract.
(5) Such notice shall be in writing and shall be served upon the disburser by
certified mail or by delivering the same personally to such disburser, or by leaving a
copy at his residence or at his place of business with some person in charge.
(6) Upon such notice being received by the disburser, it is the duty of the
disburser, before disbursing any funds to the person designated in said notice with
whom said claimant has contracted, to ascertain the amount due to the claimant on
any disbursement date, and to pay such amount directly to the claimant out of any
undisbursed funds available for and due to said person designated in said notice on
such date; except that any amounts actually paid by the disburser to others for
labor, services, machinery, tools, equipment, and laborers or materials performed,
supplied, or furnished for such structure or improvement that are chargeable to
said person designated in said notice shall not be deemed available for said person
designated in said notice; and further except that if the amount claimed by said
claimant is disputed by said person designated in said notice, the disburser may
impound such amount until the amount due is settled by agreement or final judicial
determination.
(7) If the disburser fails to comply with subsection (6) of this section and the
said claimant suffers loss by reason of said failure the disburser shall be liable to
said claimant for the amount which the disburser should have paid claimant to the
extent of claimant's loss.