Lien for Mobile Home renting space in park

1 year ago

We have been using Zlien’s services to process liens for non paying customers. However, most of our customers DO NOT own the land where the mobile home sits. They rent the space instead. We are now having to release the liens after the park owners have asked to do so for obvious reasons. Do you have any suggestions on how to best solve this situation? Is there a way for the lien to be placed ONLY on the actual mobile home even if it may be considered personal property rather than real property? We are looking into UCC-1 scenarios, but would rather keep using your services if possible. Thank you.

Senior Legal Associate Levelset

Mechanics liens on tenant property can be a handful. However, in California, they’re not disallowed. Just because an owner does not contract for work themselves does not mean that the lease or the fee interest in the property cannot be liened. When a property owner agrees to an improvement made by the tenant – or when they have knowledge that the tenant is improving the property and allow the improvement to continue – the work is considered to be authorized, and therefore, lienable. Under § 8442 of the California Civil Code, such a lien attaches to: “(a) The interest of a person that contracted for the work of improvement. (b) The interest of a person that did not contract for the work of improvement, if work for which the lien is claimed was provided with the knowledge of that person, unless that person gives notice of nonresponsibility…” Thus, when a lien claim is filed pursuant to an agreement with someone other than the owner of the property (like a tenant), a lien can attach to their interest in the property (often, their lease). Further, if the owner knew about the improvement and did not give a Notice of Nonresponsibility, the owner’s interest may still be liened. The owner will only have 10 days from their knowledge of the improvement to file a Notice of Nonresponsibility with the county and it must also be posted at the job site. Plus, there are several requirements binding this notice- and if the owner fails to abide by these requirements, their notice may be ineffective and their interest might still be lienable. This reiterates the importance of sending preliminary notice in California. If notice is sent at the start of the project, the owner will have knowledge that their tenant is improving the property. If that owner then posts a Notice of Nonresponsibility or otherwise disputes the project moving forward, the party providing work can find some other way to secure their right to payment (with one of these options, potentially). Finally, to change gears somewhat, this also presents an opportunity to start the payment security process with a proactive approach. By sending the property owner a Notice of Intent to Lien for work unpaid by the tenant, a claimant can put extra pressure on the tenant to make payment- the tenant will now have both the claimant and their landlord bearing down on them. The thought of losing the lease may spur the tenant into making payment. If payment is still not forthcoming, depending on the surrounding circumstances, a lien may still be filed. Finally, alerting the owner that a lien might be filed will also not disrupt a claimant’s right to lien the owner’s interest if preliminary notice was sent to the owner. The Notice of Nonresponsibility mentioned above is only effective (to some degree) if it was filed and posted within 10 days of their knowledge of the project. When a Notice of Intent to Lien is sent (typically, beyond 10 days after the preliminary notice), it would be too late for an owner to utilize a Notice of Nonresponsiblity (as long as they did have prior knowledge).

Guest
Anonymous

What about in Arizona? I am receiving a letter from the Attorney representing the park in which the Mobile Home is located stating that we can not pre-lien them?

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