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I need to know next steps to collect our outstanding balance..

CaliforniaRecovery Options

We just finished up a project in CA, where we did file a preliminary notice, and tried to update the amount as it did increase and the client was paying weekly until about the last 4-5 weeks of the project. We know their were some issues between the subcontract(our client) and contractor with the client, however we are stilled owed over $100,000. He is communicating with us, and I know he had some of his guys go out to finish up the a few things this week, so the job is almost completed. We just want to know the next steps to ensure we will get paid. Should we start with the notice of intent to lien already?

1 reply

Aug 21, 2018
That's quite the outstanding balance - I'm sorry to hear that. The next steps for recovery can vary quite a bit depending on the claimant's preferences, the relationships on the job, and how much time is left on the clock (prior to the mechanics lien deadline). First - the lien deadline. As you may know, claimants other than a direct contractor must record their mechanics lien after the claimant ceases to provide work, and before the earlier of either: 90 days after completion of the work of improvement; or, 30 days after the owner records a Notice of Completion or Cessation. Thus, even when a project is wrapping up, there's still some time on the clock - but a claimant should keep an eye out for a Notice of Completion or Cessation which would cut down the time to file a lien. For a Notice of Completion or Cessation to be effective, an owner is required to give a copy of the document to each claimant who sent preliminary notice - so it should be relatively easy to know if one has been filed. Anyway, while it's important to keep the deadline in mind for purposes of filing a lien (if necessary), this deadline should also inform other decisions on how to proceed. As mentioned in your question, a Notice of Intent to Lien can be a powerful tool for recovery. But, naturally, when the word "lien" is mentioned (even in a Notice of Intent to Lien), relationships can be affected. As a result, if there is plenty of time left before a lien would become necessary, a claimant may want to wait to escalate a dispute with a Notice of Intent to Lien. With plenty of time to send a Notice of Intent to Lien and to later actually file a lien, it might make sense to continue discussions surrounding payments until further action becomes necessary. On the other hand, if a relationship has already deteriorated or if it looks like the payment issue will be escalating to a full-blown dispute, it might be a good idea to send a Notice of Intent to Lien to push the dispute forward more quickly. While the next steps for a claimant can vary a lot from situation to situation, all unpaid parties should keep one eye on the lien deadline. Once that date passes, recovery can become much more complicated and expensive - and lien deadlines are strictly construed.
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