Mechanics Lien Release (Recorded Lien Cancellation)

RELEASE OF MECHANICS (CONSTRUCTION) LIEN

(Montana)

RECORDING REQUESTED BY:
[________________________________]

WHEN RECORDED MAIL TO:
[________________________________]
[________________________________]
[________________________________]

SPACE ABOVE THIS LINE FOR RECORDER'S USE

PART ONE: FULL RELEASE OF MECHANICS LIEN

1. Original Lien Recording Information

2. Property Information

(If legal description is lengthy, state "See Exhibit A attached hereto and incorporated by reference.")

3. Parties

4. Original Lien Information

5. Release Statement

The undersigned, [________________________________] ("Claimant"), being the holder of the mechanics (construction) lien described above, recorded in the office of the Clerk and Recorder of [________________________________] County, Montana, as Document No. [________________________________], hereby acknowledges full satisfaction of said lien and releases, cancels, discharges, and relinquishes all right, title, interest, and claim under said lien against the above-described real property and all improvements thereon.

Reason for Release:

☐ Full payment has been received in the amount of $[________________________________], representing complete satisfaction of all sums claimed under the lien.

☐ Settlement and compromise have been reached between the parties, with the Claimant accepting $[________________________________] in full and final satisfaction of all claims.

☐ The underlying claim has been resolved by final court order or judgment entered on [__/__/____] in Case No. [________________________________], in the [________________________________] Judicial District Court, [________________________________] County, Montana.

☐ Other: [________________________________]

This release is made pursuant to MCA § 71-3-537 (Acknowledgment of Satisfaction of Lien) and satisfies the Claimant's obligation under Montana law to acknowledge satisfaction of the indebtedness secured by the lien.

Effective Date of Release: [__/__/____]

The Claimant warrants that no assignment, transfer, or encumbrance of the lien or the underlying claim has been made, and that the Claimant has full authority to execute this release.

The Clerk and Recorder of [________________________________] County, Montana, is hereby authorized and directed to cancel and discharge the above-referenced lien of record.

6. Claimant Execution

Signature: ______________________________

Printed Name: [________________________________]

Title/Capacity: [________________________________]

Date: [__/__/____]

If Claimant is an Entity:

Entity Name: [________________________________]

By: ______________________________ Its: [________________________________]

7. Notarization

STATE OF MONTANA
County of [________________________________]

On this [____] day of [________________________________], 20[____], before me, the undersigned Notary Public, personally appeared [________________________________], known to me (or proved to me on the basis of satisfactory evidence) to be the person(s) whose name(s) is/are subscribed to the within instrument, and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies), and that by his/her/their signature(s) on the instrument the person(s), or the entity upon behalf of which the person(s) acted, executed the instrument.

IN WITNESS WHEREOF, I have hereunto set my hand and affixed my official seal.

Notary Public: ______________________________

Printed Name: [________________________________]

My Commission Expires: [__/__/____]

(NOTARIAL SEAL)

PART TWO: PARTIAL RELEASE OF MECHANICS LIEN

1. Partial Release Statement

The undersigned, [________________________________] ("Claimant"), being the holder of the mechanics (construction) lien recorded in the office of the Clerk and Recorder of [________________________________] County, Montana, as Document No. [________________________________], on [__/__/____], in the original amount of $[________________________________], hereby partially releases said lien as follows:

Partial Payment Received: $[________________________________]

Remaining Lien Balance: $[________________________________]

Scope of Partial Release:

☐ Reduction in Amount Only. The lien amount is reduced from $[________________________________] to $[________________________________]. The lien continues to encumber all property described in the original lien.

☐ Release of Specific Parcel(s). The following described portion of the property is released from the lien, with the lien continuing against all remaining property described in the original lien:

Released Parcel Legal Description: [________________________________]

Released Parcel Address: [________________________________]

☐ Combination. Both a reduction in amount and release of specific parcels as described above.

Remaining Lien. The Claimant expressly reserves all rights under the lien as to the unreleased amount of $[________________________________] and any unreleased property. This partial release does not constitute a waiver of any rights, claims, or remedies with respect to the remaining balance.

This partial release is effective as of [__/__/____].

2. Partial Release Execution

Signature: ______________________________

Printed Name: [________________________________]

Title/Capacity: [________________________________]

Date: [__/__/____]

(Notarization required — use same notarization form as Part One, Section 7.)

PART THREE: RELEASE OF LIEN BY SUBSTITUTION OF BOND

(Pursuant to MCA §§ 71-3-551 to 71-3-553)

1. Bond Substitution Statement

NOTICE IS HEREBY GIVEN that [________________________________] ("Property Owner/Contracting Owner"), pursuant to Montana Code Annotated § 71-3-551, has filed a bond in substitution for the mechanics (construction) lien described below, and that said lien has been discharged and released of record.

2. Lien Information

3. Bond Information

4. Statutory Requirements — MCA § 71-3-551

Under Montana law, the bond must meet all of the following requirements:

☐ The bond is in an amount equal to one and one-half times (150%) the amount of the lien claimed, i.e., $[________________________________] (150% of $[________________________________]).

☐ The bond is either in cash or written by a corporate surety company authorized to do business in Montana.

☐ The bond is conditioned upon payment of any judgment that may be rendered in favor of the lien claimant for the enforcement of the lien.

☐ The bond has been filed with the County Clerk and Recorder in the county where the lien was recorded.

5. Effect of Bond Filing

Pursuant to MCA § 71-3-552, upon the filing of the bond as provided in § 71-3-551, the lien against the real property is hereby discharged and released in full, and the bond is substituted for such lien. Any action to enforce the lien claim shall be brought against the bond and surety rather than the real property.

6. Property Owner Execution

Signature: ______________________________

Printed Name: [________________________________]

Title/Capacity: [________________________________]

Date: [__/__/____]

(Notarization required — use same notarization form as Part One, Section 7.)

PART FOUR: DEMAND FOR RELEASE OF MECHANICS LIEN

(Letter from Property Owner to Lien Claimant)

Date: [__/__/____]

VIA CERTIFIED MAIL, RETURN RECEIPT REQUESTED

To:
[________________________________]
[________________________________]
[________________________________]

Re: Demand for Release of Mechanics (Construction) Lien
Property: [________________________________]
County: [________________________________], Montana
Document No.: [________________________________]
Recording Date: [__/__/____]

Dear [________________________________]:

I am the owner (or authorized representative of the owner) of the above-referenced property. A mechanics (construction) lien was recorded against this property by you or your company on [__/__/____] as Document No. [________________________________] in the office of the Clerk and Recorder of [________________________________] County, Montana.

I hereby demand that you release this lien for the following reason(s):

☐ Full payment has been made. The total amount of $[________________________________] has been paid in full on [__/__/____], satisfying all obligations underlying the lien claim. Proof of payment is attached hereto as Exhibit [____].

☐ The lien is time-barred. The two-year limitation period under MCA § 71-3-562 has expired. The lien was filed on [__/__/____], and no foreclosure action was commenced within two years of that date.

☐ The lien was improperly filed. The lien fails to comply with statutory requirements under MCA § 71-3-535 because: [________________________________]

☐ Other: [________________________________]

Statutory Obligations:

Under MCA § 71-3-537, when the indebtedness secured by a construction lien is paid and satisfied, the creditor has a duty to acknowledge satisfaction in the same manner as a mortgage. Failure to do so subjects the creditor to liability for the amount of injury and costs of action.

Under MCA § 71-3-538, a person who has filed a notice of the right to claim a lien must file a release within five (5) business days of the property owner's request.

Under MCA § 71-3-131 (general lien satisfaction), failure to acknowledge satisfaction subjects the creditor to a civil penalty of $100 plus any other damages provided by law.

Demand. You are hereby demanded to file a release of the lien with the Clerk and Recorder of [________________________________] County, Montana, within five (5) business days of receipt of this demand. If you fail to release the lien within the required time, I will pursue all available legal remedies, including but not limited to:

1. Filing a petition with the District Court to compel release;
2. Seeking an award of damages and costs of action under MCA § 71-3-537;
3. Recovery of the $100 civil penalty under MCA § 71-3-131; and
4. Recovery of attorney's fees and costs.

Sincerely,

______________________________
[________________________________]
[________________________________]
[________________________________]

PART FIVE: PETITION TO DISCHARGE MECHANICS LIEN

(Filed in Montana District Court)

Caption

IN THE [________________________________] JUDICIAL DISTRICT COURT
[________________________________] COUNTY, MONTANA

Petition

Petitioner, [________________________________], by and through undersigned counsel, respectfully petitions this Court for an order discharging the mechanics (construction) lien recorded against Petitioner's property and states as follows:

I. PARTIES AND PROPERTY

1. Petitioner is the owner of real property located at [________________________________], in [________________________________] County, Montana, legally described as: [________________________________].

2. Respondent, [________________________________], is the party that recorded a mechanics (construction) lien against the Property.

II. THE LIEN

3. On [__/__/____], Respondent caused a mechanics (construction) lien to be recorded in the office of the Clerk and Recorder of [________________________________] County, Montana, as Document No. [________________________________], in the amount of $[________________________________].

4. The lien claims amounts due for: [________________________________].

III. GROUNDS FOR DISCHARGE

5. Petitioner is entitled to discharge of the lien on the following grounds:

☐ Full Payment (MCA § 71-3-537). The indebtedness secured by the lien has been paid and satisfied in full on [__/__/____]. Despite payment, Respondent has failed and refused to acknowledge satisfaction and release the lien.

☐ Expiration of Enforcement Period (MCA § 71-3-562). Respondent failed to commence foreclosure proceedings within two (2) years from the date the lien was filed, as required by MCA § 71-3-562. The lien was filed on [__/__/____], and no foreclosure action has been commenced.

☐ Failure to Release After Demand (MCA § 71-3-538). Petitioner made written demand upon Respondent on [__/__/____] to release the lien. More than five (5) business days have elapsed since demand, and Respondent has failed to file a release.

☐ Defective Lien. The lien fails to comply with statutory requirements because: [________________________________].

☐ No Valid Basis. The lien was filed without a valid basis under MCA § 71-3-524 because: [________________________________].

IV. PRIOR DEMAND

6. On [__/__/____], Petitioner served a written demand upon Respondent via [________________________________] requiring release of the lien. A copy of the demand is attached hereto as Exhibit [____].

7. Respondent has failed to release the lien as demanded.

V. RELIEF REQUESTED

WHEREFORE, Petitioner respectfully requests that this Court:

a. Issue an order declaring the mechanics (construction) lien void and unenforceable;

b. Direct the Clerk and Recorder of [________________________________] County, Montana, to discharge and cancel the lien of record;

c. Award Petitioner damages for injury caused by the wrongful lien, including but not limited to interference with sale, refinancing, or use of the property;

d. Award Petitioner the $100 civil penalty under MCA § 71-3-131;

e. Award Petitioner reasonable attorney's fees and costs of this action; and

f. Grant such other and further relief as the Court deems just and proper.

DATED: [__/__/____]

______________________________
[________________________________]
Attorney for Petitioner
[________________________________]
[________________________________]
Montana State Bar No. [________________________________]

Verification

STATE OF MONTANA
County of [________________________________]

I, [________________________________], being first duly sworn, state that I am the Petitioner in the foregoing Petition, that I have read the same, and that the facts stated therein are true and correct to the best of my knowledge, information, and belief.

______________________________
[________________________________]

Subscribed and sworn to before me on [__/__/____].

Notary Public: ______________________________
My Commission Expires: [__/__/____]

PART SIX: RECORDING INSTRUCTIONS AND STATUTORY REFERENCE

Montana Recording Requirements

County Clerk and Recorder Contact — Major Montana Counties

Statutory Deadlines and Penalties — Montana

Practitioner Notes — Montana

1. Satisfaction "In the Same Manner as a Mortgage." MCA § 71-3-537 requires lien satisfaction to follow the same procedures as mortgage satisfaction under MCA § 71-3-131. This means the lien claimant must execute and record a formal satisfaction document.

2. Five Business Day Release Deadline. Under MCA § 71-3-538, the release must be filed within 5 business days of the owner's written request. The release must include: (a) the Clerk's file number of the original notice; (b) the original filing date; (c) the property owner's name; and (d) the signature of the person who filed the original notice or an authorized representative.

3. Bond Substitution Is Powerful. Under MCA § 71-3-551, the property owner can unilaterally remove the lien by posting a bond at 150% of the lien amount. The lien is "forthwith discharged and released in full" upon bond filing. The lien claimant's remedy then shifts to the bond.

4. Two-Year Foreclosure Window. All foreclosure actions under MCA § 71-3-562 must be commenced within 2 years from the date of lien filing. After this period, the lien ceases to exist as a matter of law, and a discharge may be sought.

5. Montana Is Not an "At-Will" Employment State (with exceptions). Montana's unique Wrongful Discharge From Employment Act (MCA § 39-2-901 et seq.) is unrelated to lien law but may be relevant when lien disputes arise in employer-employee construction contexts.

6. Recording Fees and Format. Always confirm current recording fees with the specific county Clerk and Recorder. Montana counties may have slightly different formatting requirements.

7. Dual Penalty Exposure. A lien claimant who refuses to release after payment faces both the specific penalty under § 71-3-537 (damages plus costs) and the general $100 civil penalty under § 71-3-131. These may be cumulative.

8. Title Insurance Implications. Title companies will not insure clear title until the lien release is recorded. For urgent transactions, consider the bond substitution procedure under § 71-3-551 as it provides immediate discharge.

This template is provided by ezel.ai for informational purposes only. It does not constitute legal advice. All mechanics lien releases should be reviewed by a licensed Montana attorney before recording. Montana law may change; verify all statutory citations before use.