Mechanics Lien Timing Issue

1 week ago

Hi,

For the states of Illinois, Florida, Nevada and California, I was wondering when the clock (i.e. the 90 days from date of completion of work) starts to run when a conditional lien waiver is executed?

Say a contractor completes work for an owner. The owner doesn’t have the money to pay the contractor immediately but does not want liens recorded against his property. Therefore, the parties execute a conditional lien waiver saying the contractor will be paid x on February 15, 2020, which is 45 days after contractor completed its work.

If the contractor is not paid on February 15, 2020 as agreed upon pursuant to the conditional lien waiver, does this mean the 90 days from day of completion of work commences on February 15, 2020? Or does the contractor only have 45 days left to record a lien which started on January 1, 2020?

Thanks.

Managing Partner Gibbs Giden LLP

I can only answer for California (although one of my colleagues @ Gibbs Giden from our Vegas office can answer for Nevada).

Assuming you are referring to a private work of improvement and assuming you are a subcontractor or supplier, the last day to record a lien runs from 90 days of “completion” of the work or 30 days from recordation of a valid notice of completion, whichever is first.   The date the conditional waiver is executed or dated does not matter.   The the term “completion” is  complicated one that is the subject of many appellate cases.

Under Civil Code section 8180, “completion” is deemed to occur on the occurrence of any of the following events:

(1)   Actual completion of the work of improvement;

(2)   Occupation or use by the owner accompanied by a cessation of labor;

(3)   Cessation of labor for a continuous period of 60 days; or

(4)   Recordation of notice of a cessation after cessation of labor for a continuous period of 30 days.

–CN

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Anonymous

Very helpful, many thanks Chris!

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