Home>Levelset Community>Legal Help>I am a Plastic Injection Molding manufacturer can I file a lien on the molds if the customer has not paid for products?
I am a Plastic Injection Molding manufacturer can I file a lien on the molds if the customer has not paid for products?
We were supplied molds from a customer and manufactured thousands of dollars of production. Customer cant pay the invoices. The molds and some of the production are in my possession and the customer wants his molds back without paying.
1 reply
Nov 11, 2019
Mechanics lien rights are generally available to those whose work, materials, or equipment improves the project property. But with materials, they're generally only lienable if they're actually used in the improvement of the property - and materials that don't actually make it to the job site typically won't be lienable.
Certainly, when a customer places an order for specially fabricated materials - the goal is for those materials to make their way into the job. But in those situations that the materials don't actually make their way into the improvement, a mechanics lien might not always be the most appropriate tool. After all, the basis for the use of mechanics lien rights is that the property being worked on is actually improved, and the value of a lien claim (where allowed) must tightly tie to the value of the work that was provided.
I'll admit, though, that I do not have a plethora of experience with filing mechanics liens for specially fabricated materials that are fabricated (but not delivered) in California - and reaching out to a California Construction Payment Expert might be helpful here. They'll likely have more experience on that front.
Other recovery options will be available
Note that regardless of whether mechanics lien rights might be on the table, there will always be other options for recovering payment. This includes potential legal action, like breach of contract, which should be available when there's an agreement in place that's not been followed.
Levelset discusses recovery options in the following articles:
- Can’t File a Lien? Here Are Some Other Options For Recovery (for situations where a mechanics lien might not be an option).
- Don’t Want to File a Mechanics Lien? Here Are 5 Other Options (for situations where it might be easier to work with a customer to resolve a dispute with a non-lien option).