Who are you? Seems like a simple enough question.
You’d be surprised how often mechanics lien claimants wrongly identify themselves in a mechanics lien, and you may even be surprised how often this makes a difference. The issue was addressed recently in Connecticut, and a mechanics lien claimant in that state lost its lien claim because it foreclosed its lien under a trade name and not its formal name.
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Mechanics Lien Action Dismissed Because Claimant Filed Under Incomplete Name
In Greco Construction v. Edelman, the Connecticut Court of Appeals was confronted with a lawsuit filed by “Greco Construction.” The problem is that “Greco Construction” isn’t a business entity that had filed business paperwork with the Secretary of State. Instead, “Greco Construction” was a trade name operated by its owner, a sole-proprietor, Brian Greco. As the Connecticut Court of Appeals pointed out in the Greco case, the formal, complete and correct name for the company was “Brian Greco d/b/a Greco Construction.”
Is this enough of a problem to dismiss Greco’s lawsuit and consequentialy its mechanics lien claim? Relying on civil procedure law and not referring at all to the mechanics lien statutes, the court explained:
In the present case, it is not disputed that Greco Construction was the trade name or assumed business name of Brian Greco doing business as Greco Construction. Because the plaintiff instituted the action using a trade name or assumed business name of “Greco Construction,” which is not a legal entity and which does not have a separate legal existence, an action brought under that trade name cannot confer jurisdiction.
While the opinion is a civil procedure opinion focusing on the court’s jurisdiction, it is of obvious importance to mechanics lien claimants.
Is This Really Fair? Would This Happen In Other Jurisdictions?
As far as fairness is concerned, the answer is I don’t know. I do know about other jurisdictions, however, and it is absolutely possible and likely that the courts in other states (or even other counties within Connecticut) would rule differently here.
The fact is that some courts go out of their way to preserve plaintiff lawsuits, and other courts strictly require that plaintiffs jump through every inconsequential procedural hoop to have a claim. That’s just the way it is. Some may think it’s unfair, such as foreign courts who mock the United States legal system for its adoration of procedure over fairness. Yet the United States mocks those courts contended that procedure is fairness. I digress.
Other courts may agree with Connecticut in this case, but there are still others who would disagree. Some already have. Consider, for example, this decision in California we wrote about in California Court Forgives Misidentification of Lien Claimant.
How To Properly Identify A Company Working Under A Trade Name
Do you still not understand what was wrong with identifying the company as “Greco Construction,” its trade name? You’re probably not alone. This presents a legal nuance little-known by non-lawyers. However, it is something I have already written about because it’s an unfortunate common mistake folks make when filing a mechanics lien. Consider this comment from my previous article “3 Mistakes Lien Claimants Make When Identifying Itself in A Mechanics Lien:”
If you are a sole proprietor, that means you do not have a company. You are an individual doing business as some type of tradename. Oftentimes, your state requires you to file a record of your trade name with the county recorder or with the secretary of state’s office…
Nevertheless, if your name is John Doe, and your operate “Kitchen Specialists,” and this company is not incorporated or organized as any specific business entity, the formal and legal name of your company would be “John Doe doing business as Kitchen Specialists,” or “John Doe d/b/a Kitchen Specialists.”
It’s also worth checking out this Wikipedia definition of “doing business as:”
The phrase “doing business as” (abbreviated DBA, dba or d/b/a) is a legal term used in the United States, meaning that the trade name, or fictitious business name, under which the business or operation is conducted and presented to the world is not the legal name of the legal person (or persons) who actually own it and are responsible for it…
The distinction between an actual and a “fictitious” name is important because businesses with “fictitious” names give no obvious indication of the entity that is legally responsible for their operation.