Once a lien has served its purpose and resulted in the claimant being paid, it still hangs around on the property record unless something is done to remove it. Obviously, a property owner that has paid the amount of the lien claim did so at least partially to have the lien removed – if the owner didn’t care about the lien, it likely wouldn’t have prompted payment. While some states mandate the removal of a lien after payment, either in a certain number of days after payment occurs or after a demand for release/removal by the property owner or any other interested party, many states don’t specifically lay out who should remove the lien, the process for doing so, the time limits associated, or any potential penalties for failure/refusal to do so. Maine, in a recently passed addition to its mechanics lien law, made lien removal requirements and consequences much more clear.
Maine’s New Removal of Satisfied Lien Requirement
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§4013. Removal of lien
1. Removal within 60 days. Unless a specific time period is otherwise provided, a holder of a lien against property issued pursuant to the laws of this State shall remove the lien within 60 days of satisfaction or discharge of the lien by the debtor or owner of the property or agent of the debtor or owner.
2. Liability. A holder of a lien, other than the State, a municipality or other governmental entity, who fails to remove a lien as provided in subsection 1 is liable to the debtor or owner of the property for reasonable attorney’s fees and costs incurred to cure the lien as a result of the failure to remove the lien.
3. Application. This section does not apply to a financing statement or other record governed by Title 11.
Now, Maine law specifically requires the lien claimant to remove a lien within a maximum of 60 days of the satisfaction of the lien. Further, the new statute sets forth potential consequences for lien claimants who fail to do so. While the penalties are limited to the costs and attorneys’ fees incurred to get the lien removed, rather than any damages suffered as a result of the failure to remove the lien, it should still provide a meaningful reason to not delay in the removal of a lien.
This should not be a controversial requirement. After all, if the lien has been satisfied, there is no reason to not have the lien removed. It is worth noting that Maine’s new removal requirement is mandatory in every case in which a mechanics lien has been satisfied, there is no need for the property owner or other interested party to request or demand the removal of the lien. This means that once payment has ben made, it is the responsibility of the lien claimant to count days and make sure the lien is released within the applicable 60-day time period.