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I paid a company for a service, they have not paid for their equipment. I’m being threatened with lien

TexasLien on Funds

I paid a company to build a pond for me. This company however has not paid the people whom the lease the equipment from and hence the equipment folks are threatening to place a lien on my property. Can they do that? I’ve met my contractual obligations.

2 replies

Jul 14, 2020

If the equipment supplier meets their statutory notice requirements, then, depending on the equipment provided, the equipment supplier may well be within their rights to file a lien on your propery. Texas law places the contractors/subcontractors' right of payment above the interests of an innocent owner as a matter of policy. There are legal options you have in handling this situation, but those options can differ based upon the language of the contract between you and your prime contractor.

Feel free to reach me directly to discuss this matter further.

Ben House

281-762-1377

ben@houseperron.com

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Mar 1, 2021

If your property is where you live, and you own the property, then the property would likely be your homestead. If so, then your contract with the company would have to have the homestead lien warnings set out in Section 53.254 of the Texas Property Code, and the contract would have to be recorded in the county real estate records before anyone could file a valid lien against your property. Consider retaining a construction attorney to evaluate your legal situation, and to help you write a letter to the equipment supplier. Even if the property is not your homestead, the equipment supplier would have to provide proper notice by certified mail to be able to file a lien. If you have withheld 10% of the original contractor's payment, then all that the equipment supplier could go after would be the 10% retainage. Good luck.

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