The owners of a project I was GC on decided to finish the work themselves. I'm sure this reasoning is not exactly true. They were not paying invoices from me that I received from my subcontractors. We have a fully compliant California Residential Remodel Contract.
The basic deadline to record a mechanic's lien is 90 days after completion of the work of improvement or cessation of the project for 60 continuous days. The deadline is shorter if the owner records a notice of completion - 30 days for subs and 60 days for a direct contractor. The lien is premature if the lien claimant is still providing work when the lien is recorded. (See Civil Code, §§ 8180, 8412, 8414.) You have 90 days after recording the lien to file a lien foreclosure action. Record a lis pendens in connection with your lien foreclosure lawsuit. If you have the ability to serve a bonded stop payment notice, that could give you some additional remedies. You probably have rights under the terms of your contract to pursue in the same lawsuit. And if the owner is lying to you, explore whether you have a valid fraud claim. That would require you to show that you did something in reliance upon the owner's fraudulent statements or false promises.