A mechanic's lien is a method used by those employed for the purpose of improving property to ensure that property owners will pay them for services and materials. If the property owner does not pay for the services or materials, the worker can initiate a court proceeding to force a sale of the property to pay for the services and materials.
Basic Requirements for Mechanic's Lien Rights
These are the basic elements required in order to determine if a person has mechanic's lien rights:
- Improvements: The improvements that the contractor makes, or the materials the contractor uses, must be for the real property that the lien will attach to. For example, a contractor cannot build on one piece of land and file for a mechanic's lien on another piece of land, even if the same owner owns both pieces of land.
- Consent: The property owner must consent to the work that the contractor or subcontractor is doing. Because a contractor or subcontractor cannot improve property without the owner's consent, the contractor cannot demand payment for that work.
How Does a Mechanic's Lien Work?
Typically, the person employed to improve the property attaches a financial claim to the property they were hired to improve. The lien is like a "hold" on the property. Generally, the property owner will be served with a notice of a lien. The lien will be recorded at the county or city recorder's office so that it becomes attached to the title of the property. If the property owner does not pay, then the court will hold proceedings to sell the property for payment of the services.
Who Is Considered a "Mechanic"?
A "mechanic" is commonly defined as someone who provides certain services, such as:
- Automotive Repair
- General contractor
Mechanic's Lien Waivers
Often a property owner will pay the general contractor and trust that the general contractor will pay any subcontractors. However, when a general contractor fails to pay the subcontractors, the subcontractors may still have the right to file for a mechanic's lien against the property owner.
Even if the property owner can prove that she paid the general contractor, courts often do not accept this as a defense to a mechanic's lien proceeding.
Waivers: Often, property owners will require that the subcontractors waive their rights to a mechanics lien, so that the property owner does not risk possibly paying for the same work twice.
Can a Mechanic's Lien Come with My New House?
Mechanic's liens follow the property, not the owner. Therefore, it is entirely possible your home may have a lien. This is especially a potential issue when sellers improve their property just prior to a sale. If you are buying a piece of property, be certain that you check the records to see if the property has a mechanic's lien attached.
Do I Need an Attorney for My Mechanic's Lien Issue?
There are several instances concerning mechanic’s liens in which the advice of an attorney can be helpful. A lawyer can help a contractor or subcontractor sift through the stiff procedural requirements and the strict deadlines for filing a mechanic's lien.
Furthermore, if you wish to improve your property, an attorney can help you draft a waiver for the mechanic's lien. Finally, if someone has already attached a mechanic's lien to your property, a civil attorney can assist you through the procedures to ensure your property will not be sold, and to develop defenses if you are taken to court.