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Does a material supplier have Mechanic's Lien / Bond rights in Puerto Rico?

Good afternoon. I have a few questions please. 1. I am looking to see if a material supplier on a public job will have rights to claim against a payment bond. 2. Our company is currently using LevelSet and I would like to know if there is an area in the platform that explains these rights for jobs in Puerto Rico. 3. What statute would lien rights in Puerto Rico be located? 4. Are you aware of any other websites where I can obtain information regarding lien/bond rights in Puerto Rico. Thank you, Patricia Uddo

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Aug 20, 2020

Mechanics lien rights are really restrictive in Puerto Rico. Generally, only laborers can file liens there. For other claimants, claims against funds or claims against the project bond are typically more appropriate. Levelset discusses this in a bit more detail here: (1) How to Get Paid on Construction Projects in Puerto Rico and the US Virgin Islands; and (2) Mechanics Lien Protection in US Territories. However, unfortunately, I'm not aware of any step-by-step guides elsewhere online. As laid out in those articles article - the rules and requirements regarding bond claims are usually laid out in the bond itself. So, obtaining and reading a copy of the bond would be extremely useful when deciding how to proceed. For claims on funds - a claim on funds will only be effective against amounts currently held by the owner that they haven't paid to the GC, yet. So, it's a good idea to make these claims sooner than later. There's no apparent "deadline" for making these claims - but if all the funds have been paid out, it will be too late to make a claim. Finally for mechanics lien claims - the lien claim must only be filed before suit gets filed to enforce the lien. And, to be sure, the deadline for filing suit is 1 year after the last furnishing of labor or materials.

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Aug 20, 2020

Upon a bit further research - material suppliers will be entitled to pursue payment via payment bond claims in Puerto Rico. That's laid out at P.R. Laws tit. 22, § 49. For subs and suppliers hired by someone other than the prime contractor, claims must be made at least 30 days before instituting an action agains the contractor and the bond. And, that suit must be initiated within 6 months of final completion and acceptance of the work under P.R. Laws tit. 22, § 55. As for mechanics lien rights - Puerto Rico's limited mechanics lien laws can be found at 29 LPRA §§ 186 to 189. As mentioned previously, lien rights are pretty exclusive - they're generally limited to laborers ("workers or employees"). According to this resource from the AGC, suppliers are not entitled to mechanics liens in Puerto Rico as laid out by this case: Montalvo & Comas Electric Corp. v. Estado Libre Asociado, 107 P.R. Dec. 558 (1978).

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Aug 20, 2020

Thank you for the response and information. It is greatly appreciated.

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