We have two design-build contracts with a client for the same property, and in our contract there is a termination clause that states if the contract is terminated by the owner for their convenience it would be subject to a 30% termination fee of the remaining balance after the fees due for work executed have been paid. Days after one of the plans got approved, Client contacted us requesting termination and stating that the property had been sold. We can not find any information online and do not know if the property is in escrow or what stage it is in. On Saturday 9/4/21 we filed an expedited mechanics with Level Set. I have four questions: 1) Can termination fees be included in mechanic's liens? 2)The design-build contracts name our engineering company (DMR Team, Inc.) as the engineer and our construction company (Procon Builders, Inc.) as the contractor. I filed the entire amount due (work+termination fee) for both companies and both contracts under one lien. Is this correct? 3)Should we be filing a lien, injunction, both, or something else? There are also also mediation and arbitration clauses in both contracts. 4) Should we also provide client with a conditional lien waiver for the amount due?
Your question has a lot to unpack. To start, you should talk to a construction attorney--and preferably one who is experienced with the design-build delivery method.
But, generally speaking liens can only include the reasonable value of the work. Absent some specific circumstances, this will not include termination fees. As to whether you would file one lien or two, it seems that the two companies provide separate services and are separate legal entities. That, and considering that one of the liens would be a design-professionals lien, would trend the answer toward two liens rather than one.
As for the final questions about what to do, that's where you should talk to an attorney. There are a few options on the table, but which one is best will depend on a few things including: what's your relationship with this owner (are they a repeat customer?), what has been the context of the discussions of termination costs, what's the value of the project?
Talk to an experienced design-build attorney to figure out what your best options are.