Unsure of lien notices from a contractor we are currently in dispute with. Unsure if it is a valid or not.
1 reply
Jul 3, 2019
That's a good question. When a contractor performs construction work that permanently improves the property where the project is located, that contractor will generally be entitled to file a mechanics lien against the underlying property as long as the construction work was authorized by the party who owns the property. So, if work was contracted and performed by the owner, generally, a contractor will be entitled to file a mechanics lien against the property if they go unpaid for their work.
Now, when talking ownership, it's important to make some distinctions. When a homeowner purchases property with the help of a lender, and, in exchange for lending, that lender is granted a mortgage on the property - but that does not mean the lender actually owns the property. Rather, the party who purchased the property, with the help of the lender, is consideed the "owner" while the lender has certain rights to the property. So, where a homeowner purchases their home with the help of a lender, that lender's presence won't prohibit a contractor from filing a mechanics lien against the property. Of course, if a lender has purchased property themselves and truly has an ownership stake in the project property, that might make things a little hazier. If that's the case, there are a number of variables that might matter - like whether there are co-owners on the property, whether the lender authorized or knew about the work, and a myriad of other considerations.
But again - if work was authorized to be performed at a given property, and if that work is performed but not paid for, then some degree of mechanics lien rights will typically arise.