Mechanical Liens: Taking Legal Action
Posted on: 8 August 2023
Mechanics liens, also known as construction liens, are powerful legal tools that help contractors, subcontractors, and suppliers get paid for the work they perform or the materials they provide on a construction project. A lien can be placed on a property when a contractor has not been paid, giving them a security interest in the property until they receive their payment.
However, if payment disputes persist, taking legal action might become necessary.
Mechanics Liens: Preliminary Steps
Before pursuing legal action, there are several steps a contractor or supplier should take:
- Send a Preliminary Notice: In many states, a preliminary notice is required before filing a mechanics lien. This notice informs the property owner, general contractor, and other relevant parties of your involvement in the project and your right to file a lien if not paid.
- Filing a Mechanics Lien: If payment is not received within a specified time after sending the preliminary notice, you can proceed with filing a mechanics lien. The lien must be filed with the county recorder's office or a similar entity in your state.
- Serving Notice of the Lien: Once the lien is filed, you must usually serve notice to the property owner. Again, the specific requirements can vary by state.
Mechanics Liens: Final Steps
If these steps do not result in payment, legal action may be necessary. Here are the stages involved in this process:
- Hiring an Attorney: Navigating the legal landscape of mechanics liens can be complex, so it's wise to hire an attorney experienced in construction law. They can guide you through the process and ensure you comply with all legal requirements.
- Filing a Lawsuit: To enforce the lien, you must file a lawsuit against the property owner. The lawsuit needs to be filed within a specific timeframe, which varies by state but is often within one to six months after filing the lien. Missing this deadline can result in the lien becoming void.
- Litigation or Settlement: Once the lawsuit is filed, the case may go to court, where a judge will decide the outcome. However, many cases are settled before reaching this point. The threat of prolonged litigation and the potential for a forced sale of the property often motivate property owners to settle the dispute and pay the debt.
- Forced Sale: If the property owner still does not pay and the court rules in your favor, the court can order the property to be sold to satisfy the lien.
While filing a lien can sometimes be enough to secure payment, there may be instances where taking legal action becomes necessary. In such cases, it's crucial to follow all legal procedures and, ideally, to seek the guidance of an experienced attorney.
For more information about mechanic liens, reach out to a local service.
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