A mechanics lien is an important legal tool. It allows a legal path to ensure payment for those who do work to improve a property. It is generally available for any type of permanent work, like building or rehabbing a structure, but not for general maintenance work.
Who can use a mechanics lien?
A prime contractor could use a mechanics lien against a homeowner, but this legal action is also available for subcontractors as well as laborers and suppliers who were not paid by the prime contractor. Although it may have been the prime contractor’s responsibility to pay these other workers, they can still hold the homeowner accountable for payment.
How do I use a mechanics lien?
In California, those who want to use a mechanics lien for payment generally begin by recording the lien with the county recorder’s office.
Do they really work?
If correctly done a mechanics lien is a very powerful tool to ensure payment. In a recent example, contractors filed multiple mechanics liens, also known as construction nonpayment claims, for work on Google’s new company campus in Mountain View, California. These claims ranged from $4 million to $13,000 on a project with an overall construction cost over $200 million. This matters because even the $13,000 lien, a relatively small amount compared to the total cost of the project, created a “major roadblock” for completion of the project.
How do I make sure my mechanics lien is successful?
It is important file the lien properly and prepare to take additional action to enforce the lien. These two steps are crucial better ensuring the lien is successful.