We are a general contractor working for another general contractor on a residential job. We are billing the contractor but they have been slow to pay. Can we lien the property?
1 reply
Apr 15, 2020
If you've performed construction work but not been paid for it, then you'll generally be entitled to file a Michigan mechanics lien. Note, though, that a Notice of Furnishing will typically be required to preserve lien rights if you were hired by someone other than the property owner. More on that here: Michigan Preliminary Notice Guide and FAQs. But, yes - mechanics lien rights will generally be available for work on Michigan residential properties.
Before opting for a mechanics lien filing, it might be useful to first send formal invoice reminders to provide your customer a chance to do the right thing and pay what's owed. Or, if they still refuse to pay what's owed, threatening to file a lien claim with a Notice of Intent to Lien could be useful. A Notice of Intent to Lien is typically sent both to the GC and to the property owner so that everyone's fully aware of the payment dispute. That way, the owner may be able to apply additional pressure on the GC to pay what's owed on the project.
Obviously, mechanics lien claims will be necessary sometimes. So, if a customer refuses to pay what's owed, or if the deadline to file a lien is drawing near, then pursuing a lien filing is a great way to secure payment. More on that process here: (1) Michigan Mechanics Lien Guide and FAQs; and (2) How to File A Michigan Mechanics Lien – Step By Step Guide To Get You Paid.