Stop-Notice - Delaware

STOP NOTICE

DELAWARE POST-FILING OWNER RETENTION REQUEST

NO DELAWARE STATUTORY STOP-NOTICE REMEDY. Title 25, Chapter 27 does not authorize a claimant to compel an owner, construction lender, or disbursing agent to freeze unpaid construction funds merely by serving a “stop notice.” This document is a noncompulsory request directed to the owner after a mechanics' lien has been entered. Under 25 Del. C. § 2723, the owner may retain from money payable to the contractor enough to discharge qualifying liens entered by persons other than that contractor and may apply retained money to a recovered lien judgment. Do not send this form before filing or represent that it creates a trust, lender duty, automatic reserve, injunction right, or independent cause of action.

TABLE OF CONTENTS

1. DOCUMENT HEADER
2. DEFINITIONS
3. OPERATIVE PROVISIONS
4. REPRESENTATIONS & WARRANTIES
5. COVENANTS & RESTRICTIONS
6. DEFAULT & REMEDIES
7. RISK ALLOCATION
8. DISPUTE RESOLUTION
9. GENERAL PROVISIONS
10. EXECUTION BLOCK

1. DOCUMENT HEADER

POST-FILING OWNER RETENTION REQUEST (“Request”) dated [DATE] by [CLAIMANT LEGAL NAME], a [STATE OF ORGANIZATION] [ENTITY TYPE] (“Claimant”), and directed to:

1. [OWNER LEGAL NAME], a [STATE] [ENTITY TYPE] (“Owner”);
2. [DIRECT CONTRACTOR LEGAL NAME], a [STATE] [ENTITY TYPE] (“Direct Contractor”).

Project: “[PROJECT NAME / DESCRIPTION]” located at [PROJECT ADDRESS, COUNTY, DELAWARE] (the “Project”).

Filed lien: Claimant filed a mechanics' lien statement of claim in the Superior Court for [COUNTY] County on [DATE], civil action / lien number [NUMBER], claiming $[CLAIMED AMOUNT]. Attach a filed copy. This Request does not amend, extend, perfect, or replace that filing.

2. DEFINITIONS

For purposes of this Request (capitalized terms appear alphabetically):

“Applicable Law” – Title 25, Chapter 27 of the Delaware Code and the current Superior Court rules and orders governing the filed mechanics' lien.

“Discharge Security” – Cash equal to the filed claim or court-approved security in no event less than that required deposit, submitted through the proceeding under 25 Del. C. § 2729.

“Claimant” – The party identified in the Document Header that filed the attached mechanics' lien claim.

“Claimed Amount” – The principal amount stated in the filed claim, before any interest, fees, or costs independently authorized by contract, statute, rule, or court order.

“Direct Contractor” – The person or entity in contractual privity with Owner for construction of the Project.

“Release or Satisfaction” – The filing or instrument required by the court and current law to discharge or satisfy the filed lien after payment, settlement, cash deposit, approved security, judgment, or other authorized disposition.

“Request” – This noncompulsory post-filing request and its attachments.

“Owner” – The fee title owner(s) of the Project real property identified in the filed claim and as of the Request date.

“Project” – The improvement described in the Document Header together with the associated real property.

“Requested Retention” – The amount the Claimant asks the Owner to consider retaining from money otherwise payable to the Direct Contractor under 25 Del. C. § 2723. The Request itself does not create a trust or mandatory reserve.

3. OPERATIVE PROVISIONS

3.1 Request to Owner

(a) Claimant states that the attached lien has been entered and asks Owner to consider retaining from money payable to Direct Contractor the amount Owner determines is permitted and appropriate under 25 Del. C. § 2723.
(b) Claimant is providing a copy to Direct Contractor by [METHOD]. This delivery is for notice and documentation only; it is not statutory service of the lien action or a substitute for service required by the court.

3.2 No Mandatory Freeze or Trust

Section 2723 says the Owner may retain money after liens are entered. This Request does not direct a lender, create a trust, require segregation, prevent lawful payment, or determine priority. Owner should obtain Delaware counsel's advice before retaining, paying, interpleading, or applying any contract balance.

3.3 Filed-Claim Control

This Request has no independent duration and does not toll any deadline. The filed statement of claim, the lien proceeding, any judgment, and current court orders control. Claimant must separately satisfy the filing, affidavit, service, prosecution, and release requirements that apply to the lien.

3.4 Court-Supervised Discharge

Under 25 Del. C. § 2729, an owner or party in interest may petition in the lien proceeding to discharge the lien by depositing cash equal to the claim, after paying the nondisputed portion as the statute requires, or by entering court-approved security in an amount not less than the required deposit. This Request cannot impose a 150% bond, a private surety-rating requirement, or a three-day release deadline.

3.5 Proposed Resolution

Claimant requests that the parties document any payment, settlement, retained-fund arrangement, or § 2729 petition in a separate signed writing reviewed by counsel. Claimant will file the release, satisfaction, stipulation, or other paper required by the court and current law when the conditions for discharge are met.

3.6 No Interest Created by Request

This Request does not create interest on retained funds. Any interest must arise from the underlying contract, a statute, or a court order independently applicable to the claim.

4. REPRESENTATIONS & WARRANTIES

Claimant states, subject to the filed claim and attached records:

• Contracting party: [NAME].
• Labor, material, or construction-management services supplied: [DESCRIPTION].
• Last relevant work or delivery date: [DATE].
• Amount claimed in the filed lien: $[AMOUNT].
• Payments, credits, offsets, and retainage accounted for: [DESCRIPTION].
• Known waivers, releases, disputes, or defenses: [DESCRIPTION / NONE KNOWN].

These statements do not replace the affidavit required by 25 Del. C. § 2712(c), cure a defective claim, or concede any Owner or Direct Contractor defense.

5. COVENANTS & RESTRICTIONS

5.1 Requested Owner Response

Claimant requests, but this form does not compel, a written response stating whether Owner:

☐ Will retain an identified amount under § 2723 pending resolution.

☐ Will not retain funds.

☐ Disputes that § 2723 applies.

☐ Intends to seek discharge under § 2729.

☐ Requests additional documents or a settlement conference.

5.2 No New Contract Without Signature

Neither delivery nor receipt of this Request creates an agreement. Any voluntary escrow, payment, settlement, release, indemnity, fee, or notice arrangement must be stated in a separate writing signed by the parties to be bound.

6. DEFAULT & REMEDIES

This unilateral Request creates no default, five-day cure period, injunction right, attorney-fee right, lender liability, or damages cap. Each person's rights and remedies arise, if at all, from the filed lien proceeding, the underlying contracts, Chapter 27, other applicable law, and court orders.

7. RISK ALLOCATION

This Request contains no indemnity, release, waiver, force-majeure provision, or limitation of liability. Do not use it to shift risk to an Owner, Direct Contractor, lender, or surety that has not signed a separate agreement.

8. DISPUTE RESOLUTION

The Superior Court proceeding in which the lien claim was filed controls lien enforcement and any § 2729 petition. This Request does not add arbitration, jury waiver, exclusive venue, or independent injunctive relief.

9. GENERAL PROVISIONS

9.1 Delivery Record

9.2 Attachments

☐ Filed statement of claim / complaint and affidavit under § 2712.

☐ Court docket or filing confirmation.

☐ Contract, invoices, payment history, and credit calculation.

☐ Relevant waivers, releases, notices, and correspondence.

☐ Proposed voluntary retention, settlement, or § 2729 papers reviewed by counsel.

10. EXECUTION BLOCK

CLAIMANT

_____________________________
[NAME]
[Title]
[CLAIMANT LEGAL NAME]

Optional verification for this Request only; do not substitute it for the filed § 2712(c) affidavit:

State of ____________ )
County of __________ ) ss.:

Subscribed and sworn before me on this ___ day of __________, 20__, by _______________________ as ______________________ of [CLAIMANT LEGAL NAME].

_____________________________
Notary Public
My Commission Expires: ___________

OWNER RESPONSE (OPTIONAL; NOT AN ADMISSION)

The undersigned acknowledges receipt only and selects the response, if any, in Section 5.1. Receipt is not agreement with the claim, waiver of defenses, or consent to withhold funds.

OWNER:
_____________________________ Date: __________
[NAME & TITLE]
[OWNER LEGAL NAME]

OFFICIAL SOURCES

• 25 Del. C. ch. 27, subchapter I — general mechanics' lien provisions
• 25 Del. C. ch. 27, subchapter II — Superior Court enforcement
• 25 Del. C. § 2723 — owner's post-lien retention option
• 25 Del. C. § 2729 — court-supervised cash or security discharge

Prepared as a noncompulsory post-filing request under current Delaware mechanics' lien law. It is not a statutory stop notice.