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Home>Levelset Community>Legal Help>30 Units in 22 story, one contract, been there since 2015, just got contract terminated. Never provided a prelim. noitce.

30 Units in 22 story, one contract, been there since 2015, just got contract terminated. Never provided a prelim. noitce.

California

5.8 million dollar contract. They terminated with 1.2 left to finish work. They got a cheaper contractor do perform work.

1 reply

Dec 1, 2017
First, I'm sorry that you're in this position, it sounds incredibly frustrating.

I'm unsure what the question here is, exactly, though. If you are asking about the applicability or availability of a mechanics lien to recover what you are owed, I'll provide a few thoughts below. In California, parties providing labor or material to a construction work of improvement are entitled to mechanics lien protection to guard against nonpayment, provided certain requirements are met. One of these requirements is providing a preliminary notice (which is effective beginning 20 days prior to the furnishing of the notice). When the potential lien claimant contracted directly with the property owner, the preliminary notice must only be provided to the construction lender (if any). In the case of the multi-million dollar project, there is likely a lender. This notice is a necessary prerequisite to filing a valid and enforceable lien.

Note, however, that work on multiple units or multiple properties can be under a singular lien in California provided the work was done pursuant to one contract - you can read more here: https://blog.zlien.com/construction-payment/single-mechanics-lien-against-multiple-properties-california/

Also note, however, that the lien is limited in amount to the lesser of "(1) The reasonable value of the work provided by the claimant. (2) The price agreed to by the claimant and the person that contracted for the work." So, if you have been paid the $4.6MM for work to date, and just are looking to recover the $1.2MM left under the contract a mechanics lien is likely not the proper avenue for recovery and a better bet would be a breach of contract lawsuit.
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