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Can an unlicensed contractor file a mechanic’s lien on my property in Hawaii?

HawaiiMechanics LienRight to Lien

Hi, I have an unlicensed contractor in Oahu, Hawaii saying he filed a mechanic’s lien on my property yesterday. Long story short, this contractor was a no show half the time. Never signed any contracts and penalties but received them. He is saying I honored his terms by working with him and making payments, and that his contract stated no liquid damages. But does this also mean he is honoring my independent contractor terms which state that he will pay a penalty of $150 per day for every day after the deadline if we’re now going on verbal honoring since there is no signed contract by both parties? I made two payments to them. On the second payment, they signed a conditional lien waiver. After second payment, they practically stopped showing up entirely. I had them rip out the bad tiling job they did in the master shower after second payment. There are multiple instances of poor workmanship throughout the home which I’ll be paying the new contractor to repair. The project is now over 3 months past deadline, Aug 17, as stated on the initial contract. I finally got another contractor in to finish up, after documenting and taking what pictures I could of the current state. It took a month to find someone to finish for at least the same amount that was left with the unlicensed contractor, but that is because I know this contractor and I was able to negotiate him down from what he originally wanted, which was more than what was left with unlicensed. In fact, all the contractors who bid to finish the work wanted about 10k or more over what was left to finish. A few weeks ago I decided to finalize my parting with unlicensed contractor (because they were showing up to the site saying they wanted to get their stuff) by sending them a final unconditional lien waiver. A week later they asked for $5,700 to sign it. And then sent me a new contract, labeled “invoice,” which is 11k over what was left to pay them. Little over a week ago they threatened to file a lien if I don’t pay. Now they’re saying they filed the lien with their lawyer yesterday. I confirmed with RICOH that their license expired Sep 30. The unlicensed contractor is saying that his license is inactive due to the fault of the DCCA not recording his new insurance but all that is remedied and not yet reflected in the online system. I’m not seeking anything from these guys. Not only was this contractor not showing up. They were smoking on site and left enough of a mess that the neighbors called to complain about it. My independent contractor form specifies professional conduct and acceptably clean work site at the end of the day. They also purchased materials for the job after I told them not to because I had a suspicion they were doing so just to keep the job with us alive somehow. The contractor claimed I restricted them access to their tools and materials because I changed the lockbox code. I did so mostly because I told them I wasn’t working with them anymore. But also because one of their employees, the one guy who was coming to the house by himself from time to time, told me they were having personnel issues and let go of some people for stealing money. The second payment I made to them was in October, for which they signed a conditional lien waiver. Soon after seeing the quality of work and having them confirm and remove the master bath shower tile, which I purchased but they were supposed to, I intended to move on from them. And figuring I would never get the deadline penalty monies credited by them, I decided to just send them an unconditional lien waiver to finalize the separation. Even though they cost me a lot of time and money. I just want to move on and get my renovation finished.

1 reply

Dec 14, 2018
This appears to be a pretty convoluted issue - and one where the best course of action may be to get a local attorney involved who can spend the time needed to understand the full nuances of the situation.

With that said, mechanics liens are generally available to parties who remain at least partially unpaid for work performed to improve property. Workmanship disputes, or disputes over the cleanliness of the property or other contractual issues, generally do not prohibit the filing of a mechanics lien - although those types of disputes may have some bearing on the amount due.

To the extent the filed lien is invalid, or the work performed was so defective as to cost the property owner additional money to remedy the defects, there is likely a claim to be made agains the lien claimant - whether under breach of contract, slander of title, or other causes of action.

While it is possible to file a an invalid or unenforceable lien, (even in Hawaii, in which a court filing is required), the fact that there is a filed lien doesn't mean that the lien will ultimately be able to force payment. The lien may be challenged and an order to have it released may be obtained.
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