You’re not paid. You don’t want to cause problems on a project, or spend relationship capital with other parties by filing an unnecessary mechanics lien claim. You don’t want to spend the money on legal claims, and quite frankly, you don’t want to make the situation turn more adversarial. So, of course, you wait. You know the mechanic’s lien claim is there and could help, but you procrastinate about filing the lien because it’s another thing you have to do and it’s not a particularly pleasant task.
This thought process is commonplace in the construction industry, but is it dangerous?
Missing Your Mechanics Lien Deadline
The first, and most obvious, danger to delaying a mechanics lien filing is that you’ll miss your deadline to file. These deadlines are very, very strict, and unfortunately, sometimes a bit lucid. Mechanics lien deadlines are calculated from the end of a project or from your last furnishing, but pinpointing this “completion date” is tough, as some states include warranty and punchlist work and other states do not. As we wrote about in the past, the devil here is in the details. You know the mechanic’s lien claim is there and could help, but you procrastinate about filing the lien because it’s another thing you have to do and it’s not a particularly pleasant task.
Less obvious than just blowing through the lien deadline is not thinking about how long it may take you to get the lien filed.levelset has a rush service that can get a mechanics lien filed in 24 hours, and if electronic recording is available, sometimes the same day. BUT, you must be very cautious here. As we wrote about in the past, there are a lot of things that can pop up and go wrong or delay a filing.
This week, we had a Texas supplier contact us about filing a mechanics lien. They had given their customer time to pay, and then more time, and then more time. Promises, promises. The promises went all the way down to the last 2 hours before the supplier’s mechanics lien deadline. The threat of a lien didn’t even matter at that point, it was simply too late.
Introducing the Lien Deadline Calculator
A FREE resource from levelset
Thinking There Is Something Better Than A Mechanics Lien
The second danger to delaying a mechanics lien claim actually relates to the thought that there may be something better out there than a lien filing. This thought is even present among attorneys, as I noticed the other day in an Avvo.com answer. A laborer had asked whether he should file a mechanics lien, and an attorney responded saying “A demand letter from an attorney can be very effective and much quicker.”
Wow! I couldn’t believe the attorney would not recommend filing a lien. What if the company who hired him went bankrupt or didn’t have the funds to pay? What if the demand letter didn’t work? What if the laborer, after going through a long litigation process, finally got a judgment and the company ignored it? There are too many variables and things that can go wrong. I think the attorney’s advice was absolutely wrong here, and the laborer should take advantage of his lien rights while he has the change. Yes, an attorney’s demand letter may be worth sending…but it should be sent in addition to the mechanics lien claim and not in lieu of it. Once the lien claim period is gone, it’s gone forever.
I said this much in a comment to the attorney’s answer here:
I disagree that “A demand letter from an attorney can be very effective and much quicker.” I think that a mechanics lien is a much more effective way to initially present your claim. You can add a demand letter along with the lien, but you can always send a demand letter, and you can only demand the wages from one party. Filing a lien is something you can only do for a limited period of time, and it opens the door to making your claim against a lot of other parties.
Never Miss a Project Deadline, Again.
You can use levelset‘s free Lien Deadline Calculator to determine the deadlines for notices and liens on any project. Just click the button below and enter your job information.