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In NJ, can we file a lien against the owner for nonpayment of improvements to the property? What is the process?

New JerseyMechanics LienRecovery Options

We have made significant improvements to the property as tenants but the owner refuses to pay for our time and efforts and our out of pocket expenditures.

1 reply

Jun 26, 2018
That's a question we get fairly often at the Construction Legal Center. First, let's look to mechanics liens in general. A mechanics lien secures the right to payment for those who provide construction labor and/or material for the permanent improvement of real property. In New Jersey, contractors, subcontractors, laborers, material/equipment suppliers, architects, engineers, surveyors, and construction managers are entitled to mechanics lien rights. The New Jersey mechanics lien statute defines a contractor as "any person in direct privity of contract with the owner of real property, or with a community association in accordance with section 3 of P.L.1993, c. 318 (C.2A:44A-3), for improvements to the real property." While a lessee is under a direct contract with the property owner, whether that contract is "for improvements to the real property," is important - and the answer is likely "probably not." If the lease contemplates or authorizes some construction or improvement to property, there might be an argument that the contract is for the improvement of the property, potentially giving rise to lien rights. However, if the lease is silent as to improvements (or, worse yet, prohibits them), a claimant would likely not be entitled to lien rights. Ultimately, claiming a lien as a tenant against a landlord is quite probably not the most appropriate method of recovery as mechanics lien rights are really meant for construction professionals. While there's a chance a lien filing might be possible, other options for recovery - such as legal action - might be a better option.
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