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Can lien include unapproved Change Orders

We are a General Contractor for commercial work in AZ and DC. We were told to halt all work due to owner having lost their funding on the projects. There was not a Notice of Completion or Cessation recorded by the owner for either location. The AZ project, we obtained a Temp Certificate of Occupancy. We also have open/pending Change Orders that we had not received approval on (executed document). Can these be included in our lien claim? We have about another month before our deadline to file lien for DC project, but same situation with open/pending change orders, but we have no temp Cert of Occupancy.

1 reply

Jul 6, 2020

Generally, change orders that have been performed may be included in lien filings. However, if the additional work wasn't actually authorized by your customer before it was performed, then that work could create issues in the lien claim. Even if the work was authorized - if it wasn't formally approved, a change order could still create some uneasiness in a lien filing. Still, there's a difference between fraud and an honest mistake. So, if you need to, you may be able to walk back the amount on your lien claim later on, if necessary. Note that if you're including change orders in an Arizona lien claim, it's important to follow the state's 30% notice rule. If you've exceeded the prelim amount by 30% or more, and if an amended preliminary notice wasn't sent, then those amounts over and above 130% of the amount on the notice won't be lienable. More on that here: Arizona’s 30% Preliminary Notice Rule. Finally, keep in mind that simply threatening to file a mechanics lien by sending a Notice of Intent to Lien will often be enough to get paid. More on that, here: What is A Notice of Intent to Lien And Should I Send One?

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