Lien

5 months ago

I have sent demand letter and noise via a lien to owner. The owners construction director email me my contract is with general contractor and not the owner. I let him know that he is the property owner and I will place a lien on him the owner. Does the owner not care? This was a 20 million dollar BMW dealerahip

Senior Legal Associate Levelset

I’m sorry to hear you’ve had trouble getting paid on this project – everyone should be paid what they’ve earned. First, I’ll say that it’s common for an owner (or their agent) to want their contractor and subs to work out their payment problems amongst themselves. As the construction director mentioned, when a sub’s contract is with the contractor – that sub’s first step to recovering payment should typically be to try and resolve the issue directly with the contractor.

However, when payment problems persist, demand letters and warnings like a Notice of Intent to Lien should work to show the owner that the payment problem is serious and that their property title could be in jeopardy of being liened. So, often, this will convince an owner that the issue is more than a little spat between their contractor and a sub. Sending demands or a Notice of Intent to Lien won’t necessarily result in an owner making payment themselves, but one of the main reasons for sending warning is to put extra pressure on the nonpaying party by having the owner breathing down their neck, too. Additionally, making sure the contractor is also receiving threats and demands will help move things along, too. Contractors may have a better understanding of just how much damage a lien claim could do to their project.

Ultimately, though, if threats are being ignored and aren’t leading to payment, actually pursuing a mechanics lien claim could do the trick. Regardless of whether an owner is scared of the lien being filed – they (or their contractor) will have to deal with the lien claim at some point. Otherwise, the property might eventually be forced into a sale.

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