Over the past few days, the New York Post, New York Daily News, and People reported on a mechanics lien filed against Martin Scorsese. These articles discuss the idea that Scorsese may lose his home to foreclosure, but it’s unlikely that Scorsese will find himself kicked out onto the Mean Streets of New York, New York. Sure, foreclosure is a potential outcome of a mechanics lien filing. However, mechanics liens rarely get that far.
Essentially, Martin Scorsese probably thought he’d hired some Goodfellas to remodel his house. However, it sounds like the contractor Departed without paying their supplier…
Like many home improvement projects, Martin Scorsese hired a contractor to perform work. That contractor then hired a supplier to provide materials for the project. Business as usual in construction. Payments were to be made from party to party in chainlike fashion – once the contractor received payment, he was supposed to pay the supplier…but he didn’t. As a result, the supplier filed a mechanics lien.
For a more in-depth look, take a look at this post: Construction Payment and Financial Risk: A Primer.