Figuring out what’s “attached” to a property can be trickier than it sounds. The answer seems obvious, but in a case in California, the court ruling was controversial. The court was called upon to decide if a manufactured home sitting on a property’s foundation was “attached'” and part of the realty, or simply an unattached fixture. Ultimately ruled that the home was an attached part of the real estate. Nevertheless, the fact that the case was so controversial and went so far (and is likely to go further to the Supreme Court) should be an indication that the question of what is and what is not an “attachment” can be sticky.
First things first, why are we having this conversation?
Every state is different in dictating what work is and is not qualified for lien rights. The state laws usually draw a line depending on the “incorporation” of the materials or labor into the improvement as a whole. So, as a clear example, installing sheetrock is definitely lienable work but plugging a microwave in an outlet and setting it on top of a counter is not lienable work.
Of course this issue can be more gray. What if, for example, the microwave is actually installed into custom cabinetry and is not as easily removed?
Looking at Illinois As An Example of Where States May Draw The Line
Again, each state is different in what constitutes an attachment and what does not. This blog post, however, will look to Illinois law to see how that state answers the question. Just as will be the case everywhere, the answer is found only on a case-by-case basis using case law and analogies as guidance.
I recently came across a great discussion of this issue in D.D. Kennedy Inc. v. Lake Petersbury Assoc. (1964), where the 4th District Court of Appeals stated:
The mere delivery of fixtures, apparatus, and machinery by a contractor, — electric wiring, motors, accessories, plumbing, piping, etc., — is not sufficient to authorize a decree establishing a contractor’s lien under Section 1 of the Act without any proof that such fixtures, apparatus, and machinery were used in such a manner as to become attached to or form a part of the real estate…where a lien is sought to be established for fixtures, apparatus, or machinery it must be alleged and proved that the things for which the lien is claimed were so attached to the building or improvement as to become a part of the real estate; whether or not machinery is within the lien law usually depends upon whether it has become a fixture…
This case – decided in 1964 – at least set a framework for making this attachment determination in Illinois, but it seems that the courts are still conflicted after all these years.
In 2002, for example, the Illinois 1st District Appeals Court acknowledged there was a “tension between a strict and liberal construction of the Act” in Luise Inc. v. Village of Skokie. In this case, the appeals court afforded liberal treatment to the act finding that the hauling of debris from the job site and delivery of raw materials to the site was lienable work because “the totality of the developing case law in all sections of the Act is broach enough to include” this type of work.
Of course, the court does not offer any clear instructions to future claimants as to what exactly constitutes lienable work and what does not. Clearly, however, allowing a lien to be filed for hauling materials away from the job site only is a far cry from the more strict interpretation of this issue.
For the time being, mechanics lien claimants and construction attorneys need to draw conclusions from this confusing jurisprudence, but it’s more likely a better plan to stay far away from the courts because that presents a significant unknown.