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Can a sub-contractor file a lien for work not even done on my property?

CaliforniaMechanics Lien

We just had to fire our contractor (unlicensed in California) for a host of reasons. We have already overpaid him based on the amount of work that he's done and where we are in our project. He is claiming we owe him more money and he just threatened that if we don't pay him additional money upon his termination, that his subcontractors that he had "lined up" are going to file liens on our property because he had them lined up during this busy time and he had given them deposits (which I don't believe). Can they even do that if they never even did any work on our property? These are subcontractors that could not possibly do any work because he didn't finish his part of the work (roofers/electricians/plumbers) - is it even a possibility they could do this or is he just trying to intimidate us (par for the course).

1 reply

Jul 27, 2018
I'm sorry to hear about that. First, it's worth mentioning that in California, unlicensed contractors may not make claims for payment - Section 7031 of the California Business and Professions Code limits the ability of an unlicensed party to recover via legal action and/or encumbering project property. This section does not appear to prevent potential lien claims from subcontractors. However as mentioned in your question above, if subcontractors have not actually performed any work they will not be able to file a valid mechanics lien. Mechanics liens secure payment for construction work that improves real property - and if property isn't improved, it's hard to argue that a lien claim would be appropriate. While a California mechanics lien may be filed for some pre-construction functions, lining up subcontractors and creating a schedule would not give rise to these pre-construction lienable amounts. Rather, the ability to file for pre-construction services is limited to professional services such as architecture or design work. Ultimately, though, it's worth noting that even when there is not a valid basis for filing a mechanics lien, the actual filing of a lien could potentially still occur. That is - recorders offices typically lack both the capacity to inspect each lien claim and the bandwidth to do so. If a claimant files a fraudulent lien, though, serious penalties could come into play. Notifying a contractor or their subs that penalties will arise as a result of fraudulent filings will often ward off improper lien claims.
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