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Ability To File A Lien

I was subcontracted through a contractor to provide commercial goods and installation on a commercial job site. The contractor was paid an advance by the owner and then fired for excessively marking up the invoice. Can I file a lien in Texas if the contractor has been paid by the owner? if not what are my options?

1 reply

Nov 10, 2017

Texas is, generally, an unpaid balance lien state - in which a mechanics lien is limited to the amount the owner has not yet paid to the direct contractor. Texas allows for "fund-trapping" language to be provided in a notice that "traps" funds in the hands of the owner by allowing and requiring the property owner to hold payment from the direct contractor. However, if the contractor was paid in advance, there would be no opportunity to send such notice.

The options are more limited without the ability to file an enforceable mechanics lien, but there are still options. A lawsuit against the contractor is always an option, or if the contract demands it an arbitration or mediation may be available. Depending on the amount at issue, small claims court may be an option (if the amount of the claim is less than $10,000). This can streamline the process and potentially save on legal fees.

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