Mechanics Liens in California: Part II: How Can Property Owners Protect Their Properties from Mechanics Liens?

What is a Mechanics Lien?

A Mechanics Lien creates a claim on the title of a property that, if followed through legal channels, may become a lien on the property. Such a lien does not allow a property owner to refinance, or get loans on, his or her property, and in certain instances can result in a foreclosure of the lien and forcing a property owner to pay the amount of the lien to the contractor or sell the property to pay off the lien.

For Property Owners

Protecting Your Property from Mechanics Liens:

1. Take Preliminary Notices Seriously: If you receive any kind of notice from your contractor or a subcontractor or material supplier regarding your property and an “Intent to Lien”, do not ignore it. Ask the contractor for a list of all subcontractors and suppliers as well as anyone who is working on the property including employees of the contractor. Make sure you keep track of any notices, including any time limits on the notices and talk to your contractor about paying the subcontractors and material suppliers. Ask for evidence of such payments.

2. Pay by Joint Checks: You may want to use joint checks that are issued to the contractor along with its subcontractors or material suppliers. This way you make sure that all parties are properly paid and it could help you prevent liens.

3. Secure Lien Waivers: Obtain lien waivers from contractors and suppliers as you make payments. These waivers confirm that they have been paid and waive their right to file a lien. Waiver forms can be obtained from your attorney or the internet.

4. Notice of Completion: An owner has the right to file a Notice of Completion that shows the work on its property is completed. This notice must be filed with the county recorder’s office. The advantage of this notice is that it reduces the time frame during which contractors can file a lien from 90 days to 30 days for contractors that have a direct contract with the owner and to 60 days for subcontractors and material suppliers.

5. Owner’s Right to Withhold Payment: As an owner you do not have the right to withhold payment that a contractor is entitled to, because you are not satisfied with their work. If you are not satisfied, talk to your contractor and attempt to come to an agreement rather than withholding payment.

6. Resolving Conflicts: First of all try to have an open line of communication with your contractor to avoid the filing of a lien. If a lien is filed, try to resolve the dispute quickly. Negotiation, mediation, or legal action may be necessary to resolve the issue.

Why Choose Ghassemian Law Group?

Mechanics Liens law is complex and trying to do it yourself may be daunting. If you are a property owner aiming to protect your investment, Ghassemian Law Group is here to help. Our team of experienced attorneys specializes in construction law and has a deep understanding of California’s mechanic’s lien laws.

Contact us today at (949) 436-2785 to schedule a consultation. Let us help you secure your rights and protect your property.

For more information on construction law and other legal matters, visit our blog page at https://glgattorneys.com/blog/.

Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. Consult with a qualified attorney for advice regarding your specific situation.