Section 1.    Chapter 254, Section 4 is hereby amended by adding at the end thereof the following new text:

If the person claiming a lien under this section has a direct contractual relationship with the original contractor but no direct contractual relationship with the owner, except for liens for labor by persons defined in section 1of this chapter, the amount of such lien shall not exceed the amount due or to become due under the original contract as of the date such person files his notice of contract and gives actual notice to the owner of such filing, unless the person claiming such lien has, within thirty days of commencement of his performance, given written notice of identification by certified mail return receipt requested to the owner in substantially the following form:

Notice of Identification

Notice is hereby given to _________________, as owner, that ____________________, as subcontractor/vendor/design professional, has entered into a written contract with __________ to furnish labor or materials, or labor and materials, or rental equipment, appliances or tools to, or to perform professional services for a certain construction project located at ___ (Street Address), ___ (Town or City), Massachusetts. The amount or estimated amount of said contract is $ _________. (No amount need be stated for contracts for the rental of equipment, appliances or tools).

This notice is to advise you of your rights under Massachusetts law in connection with the improvement to your property. If we are not paid by your contractor, we can file a lien against your property for the price of our labor or materials. You have the right to pay us directly and deduct this amount from the contract price, or withhold the amounts due from your contractor until 90 days after completion of the improvement unless your contractor gives you a lien waiver signed by me (us). 

The amount stated in any such notice of identification shall not limit the amount of the lien. Any inaccuracy in the naming of the contractor or other information in such notice shall not affect its validity provided there shall be actual notice.

If said notice of identification is given by the person claiming the lien to the owner, the amount of the lien shall not exceed the amount due or to become due under the original contract as of the date the owner receives the notice of identification.

Any person asserting that a lien under this section exceeds the amount due or to become due as defined in section 2A, whether under the original contract or a subcontract, shall have the burden of proving the amount due or to become due.

Section 2. Chapter 254 is hereby further amended by inserting after Section 4, the following new Section:

254:4A:  Notice by Contractor to Property Owner of Subcontractors Lien Rights

  Section 4A.  Every person who enters into a contract with the owner for the improvement of real property for the construction of 1 to 4 units of housing and who has contracted or will contract with any subcontractors or material suppliers to provide labor, skill or materials for the improvement shall include in any written contract with the owner the notice required in this section. The notice must be in at least 10-point bold type, if printed, or in capital letters, if typewritten and must state as follows:

"(a) Any person or company supplying labor or materials for this improvement to your property may file a lien against your property if that person or company is not paid for the contributions.

(b)  You have the right to pay persons who supplied labor or materials for this improvement directly and deduct this amount from our contract price, or withhold the amounts due them from us until 90 days after completion of the improvement unless we give you a lien waiver signed by persons who supplied any labor or material for the improvement and who gave you timely notice of identification and/or notice of contract as required under this section."

The notice required by this section is not required of any person who is an owner of the improved real estate, to any corporate contractor of which the owner of the improved real estate is an officer or controlling shareholder, to any contractor who is an officer or controlling shareholder of a corporation which is the owner of the improved real estate, or to any corporate contractor managed or controlled by substantially the same persons who manage or control a corporation which is the owner of the improved real estate.

A contractor who contracts with any subcontractors or material suppliers to provide labor, skill or materials for the improvement shall upon written request provide the subcontractor or material supplier with the name and address of the owner within 10 days of the initial written request. Any contractor who fails to supply the information requested pursuant to this section, is liable for any actual damages sustained or expenses incurred by the subcontractor or material supplier because of the contractor's failure to provide the information.