Case: the unpaid job that lost its lien rights
In one paragraph
A new C-10 corporation does the rough and finish electrical on a kitchen remodel for a general contractor, bills $14,200, and is paid $6,000. The GC stops answering. When the electrician finally learns what a preliminary notice is, the 20 days are long gone, the owner has paid the GC in full, and the remedy against the owner's property no longer exists. The names are invented; every deadline is real.
The rule
A subcontractor may enforce a lien or a stop payment notice only if it gave preliminary notice to the owner, direct contractor and lender not later than 20 days after first furnishing work (Civil Code 8200(a), (c), 8204(a)); a later notice covers only work in the prior 20 days. The prime's failure to pay a sub within seven days of receiving payment is a licensing violation with a 2% per month penalty (B&P 7108.5), but that claim runs against the prime, not the property.
Why it matters
The preliminary notice costs a stamp and ten minutes on day one. Without it, a subcontractor's only remedy is a lawsuit against a general contractor who may have nothing to collect, capped at $6,250 in small claims for a corporation. Every subcontractor loses this way once; the point of the case is to make it the last time you read about it instead of the first time you live it.