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Do we have lien rights in AZ if we only supplied shop drawings and samples, not actual materials to be installed?

ArizonaRight to Lien

We are a material supplier. We did some shop-drawings, including estimating and engineering work related to our products for a Sub on a project in AZ and sent mock-up samples. The customer was advised if the project was canceled, they would be charged for these services. They then informed us they do not want our product, and state they have no money to pay the cancellation fee so were going to pass the invoice on to the GC and Architect to pay. We need to know if we have lien rights in those circumstances.

1 reply

Mar 4, 2019

That's a good question, and I'm sorry to hear you've had trouble obtaining payment here. First, I should mention that I'm not able to advise you about your specific situation - but I am able to provide some legal information that should be relevant and helpful. For legal advice, it would be helpful to contact a local construction attorney so they can review the situation in depth and advice on how to proceed. Anyway, while payment may be owed for construction-related expenses or work - mechanics lien rights will generally only arise to the extent that the claimant's work has improved the project property. Meaning, if a claimant's work has not altered or improved the project property, generally, mechanics lien rights do not arise. Looking to § 33-981(A) of the Arizona mechanics lien statute, lien rights are available for "every person who labors or furnishes professional services, materials, machinery, fixtures or tools in the construction, alteration or repair of any building, or other structure or improvement". (Emphasis added). Based on that section - it appears that "professional services" (defined at § 33-1007 as "architectural practice, engineering practice or land surveying practice as defined in § 32-101") might give rise to lien rights, the work must still result in the improvement of property in order to give rise to a valid and enforceable mechanics lien claim. For more information on Arizona lien rights, this resource should be valuable: Arizona Lien & Notice FAQs. Keep in mind, though, that filing a mechanics lien is only one of many options to recover payment. Plus, regardless of the ultimate ability or decision to file a mechanics lien, the mere warning or threat of a mechanics lien claim is often enough to compel payment. When a document like a Notice of Intent to Lien is sent to a claimant's customer, as well as the general contractor, architect, owner, or any other top-of-chain party, it can help put pressure on a claimant's customer to resolve the dispute before a lien claim is filed. You can learn more about that idea here: What is a Notice of Intent to Lien? Plus, there are always other options when claimants don't want to proceed with a mechanics lien claim - and that's discussed in this article: Don’t Want to File a Mechanics Lien? Here Are 5 Other Options.

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