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Threat of a lien during a payment/invoice dispute

What are the legal remedies in Texas if a lien is filed improperly filed. One of our subcontractors is threatening to file a lien against our project while we are in the middle of disputing invoices with them. I'd like to tell them why they shouldn't/couldn't file the lien. Thank you, Keri

1 reply

Feb 12, 2020

First, it's worth noting that subcontractors and other claimants will generally be entitled to lien even if there's a dispute as to what's owed. So, while there may be a perfectly valid argument over what is and isn't owed, the mere fact that the parties don't agree won't stop a lien from being perfectly valid and enforceable. Generally, if there's a very minor issue with a lien, that issue might not even render the claim invalid. If there's a more substantial issue - like failure to send required notices or significant clerical flaws - then that might result in a court tossing the lien aside and could even result in some light damages or attorney fees for the improper filing if the owner challenges the validity of the claim. But, if a lien is filed in bad faith or if the claimant files a false lien - then the claimant could be liable for up to $10,000 or actual damages incurred by the owner (whichever is greater), plus attorney fees, under Tex. Civ. Prac. & Rem. Code § 12.002(a-2). So, in addition to challenging the validity of the lien, an owner could conceivably assert that the claimant has run afoul of that section and is thereby liable for serious damages. But, keep in mind that there's a difference between an honest mistake and a fraudulent lien - so it could be an uphill battle to assert serious damages over good faith dispute. However, for the ultimate clarity on what actions or damages may be available against a claimant, your best bet would be to consult with a local Texas construction attorney. They'll be able to review your circumstances and give clear advice on how to proceed.

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