We supply fuel to subcontractors who perform work on construction projects. I am uncertain if we qualify to file mechanics liens.
Mar 30, 2018
At first blush, the supplying of fuel to subcontractors would not seem like material supply that would provide for mechanics lien rights. Granted, there is some grey area in lien law, and a mechanics lien can actually be filed in many situations where a lien claim wouldn't really be proper. Of course, if such a lien is challenged or if a claimant attempts to foreclose - a court might very well invalidate a lien claim, and if determined invalid, a claimant could potentially face penalties for an improper lien filing. However, a claimant would likely have the opportunity to release their lien claim and pursue some other course of action before a dispute gets that far. You can find more on this topic here. Anyway, unfortunately, I'm not sure this situation would be appropriate for utilizing a mechanics lien for nonpayment. As a general matter, mechanics lien rights typically arise out of some labor or material contribution to a construction for improvement of real property. But, not just any effort will suffice. While material suppliers do have lien rights, the supplying of fuel may be too indirect to the improvement of the property for a lien claim. This certainly does not mean that there is no ability to recover payment, though. First, the mere threat to file a lien - even where a lien claim might not be proper - often encourages payment when it is not forthcoming. Further, a more formal demand letter may be an option here - the threat of legal action is also effective to speed up payments. Finally, small claims court is a risky option, but it's an option nonetheless for outstanding claims that might not reach the level of conventional litigation.