Recently a long term customer that uses both TRADITION SOFTWARE‘s PreLien2Lien and TRADITION LIEN SERVICE that supplies electrical distribution products on construction projects called because their Vice President of Sales was demanding that the Estimated Amount not appear on CALIFORNIA Preliminary Notices the company was sending out. A credit employee was questioning whether the dollar amount was legally required.
Rather than just using my name, title and 21 years of experience as a reference on this, I used Google AI to document my answer.
Key points from this and other Google Gemini answers:
1) CALIFORNIA Civil Code Section 8802 states that a Preliminary Notice must include an estimate of the total price of the equipment, labor, materials or services to be provided.
2) If you want to be even more specific to materials suppliers, type “Do material suppliers have to provide a estimated dollar amount on California Preliminary notices” in Google. The answer will be very similar to the Google image above.
3) The purpose is help Property Owners and General Contractors understand potential obligations.
4) The “estimate” does not have to be exact. But it must be “reasonable” and “in good faith”. Generally you can safely add 10% to the amount.
Sales executives and General Contractors will often try to bully credit professionals on the estimated amount appearing on a Preliminary Notice. It is very difficult for them to have any kind of legitimate rebuttal to the estimated amount appearing when your answer is based on California law.