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Should a lien be placed on multiple plots if work has been done for a zoning submission on multiple lots?

New JerseyMechanics Lien

In New Jersey, we have completed work obtaining approvals for site plan development of multiple plots located on one block in Newark, New jersey. The client has suddenly refused to pay fees when billed, and yet we have not yet submitted final stamped signed and sealed drawings for the already-approved site plan submission. Approval was obtained at a town planning meeting with unanimous vote of approval. The property address in question was 597-601, however this address represented multiple lots that the developer is intending to combine. Do we need to submit multiple liens on multiple plots? or is the address alone or one lot sufficient?

1 reply

Jul 18, 2018
I'm sorry to hear about that. First, it's worth noting that pre-construction services on a property that has not actually been improved would not give rise to lien rights in many (if not most) states. However, it appears New Jersey provides protection for these services under its mechanics lien laws. Specifically, under § 2A: 44A-3(a) of the New Jersey lien statute, "Any contractor, subcontractor or supplier who provides work, services, material or equipment pursuant to a contract, shall be entitled to a lien for the value of the work or services performed..." The statute defines "services" to include "professional services performed by a licensed architect, engineer, land surveyor, or certified landscape architect, who is not a salaried employee of the contractor, a subcontractor or the owner and who is in direct privity of contract with the owner for the preparation of plans, documents, studies, or the provision of other services by a licensed architect, engineer or land surveyor prepared in connection with improvement to real property, whether or not such improvement is undertaken." So, in a little more plain English: If those statutorily-described services were provided to the owner of the property via direct contract, those services will give rise to lien rights for the party who performed them. Knowing that a lien might be filed for pre-construction services on land where an improvement has not yet taken place - let's look at whether one lien would be sufficient. The general rule for mechanics lien filings is that where work is performed on multiple separate parcels or lots, the safest way to proceed is to file a separate lien against the separate property. However, when multiple lots, owned by the same owner, are improved under one prime contract, things seem to become less clear. Unfortunately, nothing in the New Jersey lien statute seems to explicitly provide for a single lien filing on multiple, separate properties. So the safer move would be to encumber all related properties separately where a developer has not yet combined individual lots - proportionally allocating the value of the work provided. Potentially, a lien claimant might also instead decide to simply encumber one lot rather than all of the properties involved, though that would provide less force than encumbering all lots related to the project property - plus the lien could not be filed for the total value of services provided to all lots. When payment is on the line, it's typically better to be safe than sorry - and the cost of filing multiple liens is often worth the peace of mind knowing that payment rights are secured.
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