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The owner hasn't paid our GC, so we filed a mechanics lien. Will it get their attention?

MinnesotaMechanics Lien

Hi I'm a electrical contractor in MN. We were hired by an out of state general to supply material and labor for 2 Xfinity stores. At this point Xfinity hasn't paid the general so I placed a lien on the property. See below an answer from the property owner. Is he correct? Thanks Mark Maybe. From what I understand from Gatlin is that the lien would be placed on the work you did for Xfinity and you would be able to take what belongs to Xfinity inside the building. Gatlin’s people tell me that the building would be exempt from any lien issues…they may be wrong. Do what you have to do. If you are correct then you will get Gatlin’s attention in Jacksonville, FL.

1 reply

Mar 10, 2020

Mechanics liens will generally not entitle a claimant to remove their work or materials from the project site, and it won't simply attach to the specific work or materials the lien claimant provided to the property. Rather, a mechanics lien claim will attach to the entire property and will be in the amount of the price of the work provided but not paid for. The owner is right in saying that a mechanics lien will usually get the attention of the project's general contractor. However, ultimately, a mechanics lien filing is against that owner's property. So, it's usually a bigger issue for the property owner at the end of the day. Though, the owner will certainly be able to make sure their contractor is heavily involved in the dispute, and may even be able to force their contractor to defend them against the claimant's lien.

Limitation on subcontractor's right to lien

Regarding the owner's property being exempt from lien claims, that may be true to some degree. § 514.03 of Minnesota's lien statute does place some limitation on subcontractors' right to lien. But, that will depend on whether or not preliminary notice was required on the job.

If preliminary notice was not required

If preliminary notice was not required, then there's no limitation on a sub's right to lien. § 514.03(1)(b) states that they're able to file a lien for "the reasonable value of the work done, and of the skill, material, and machinery furnished."

If preliminary notice was required

If preliminary notice was required, then lien rights may be limited, to some degree. Under § 514.03(2), a subcontractor's mechanics lien is capped at the total price of the project, minus payments already made by the owner on the job. So, in a situation where the GC has been fully paid on the job, a subcontractor might not be able to pursue lien rights in Minnesota.

Minnesota's preliminary notice requirements are confusing

Obviously, it's important to understand whether or not preliminary notice is required in Minnesota. If a claimant isn't required to send notice, then lien rights will be drastically affected. For help with that, this resource should be valuable: Minnesota Pre-Lien Notice Requirements and Exceptions.

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