Menu
Home>Levelset Community>Legal Help>TX retainage and liens

TX retainage and liens

TexasMechanics LienRetainage

When I bring up the subject of liening a job with a retainage balance only, the GC will often quote the contract, that states retainage will be paid once the GC has received payment from the owner. Can you offer me a good reply?

15 replies

Aug 17, 2021

The requirements for perfecting a mechanic's lien operate independently, and sometimes at odds with a subcontract. To perfect a mechanic's lien for retainage, you should (ignoring the subcontract) provide notice of non-payment by certified mail to the owner and the general contractor, with a request to trap funds, and notice of retainage. 

Retain a construction attorney to review your contract and pertinent documents and to provide advice.

Good luck.

0 people found this helpful
Helpful
Aug 17, 2021

Yes, thank you! Now this would apply to all states, and not just TX, correct? My boilerplate response has been that our lien deadline and rights are independent of the contract. And yes
- we do provide all notices - Levelset walks us through them all.  

0
Report Spam
Aug 17, 2021

Texas has some amazingly complex and convoluted mechanic's lien laws. Most other states are simpler.

1 person found this helpful
Helpful
Aug 17, 2021
You have a deadline to send a notice to the owner and to file a lien for retainage. You should send a notice letter to the owner now. You should file a lien within 20 days after the entire job is finished. The "pay when paid" retainage does not change your deadlines. You can tell the GC "I have to send notices and file my lien within the deadlines set by Texas law. As soon as I am paid I will release my claim and the lien."
 
1 person found this helpful
Helpful
Aug 18, 2021

Hello,

File the retainage lien. Ignore the GC. You can always remove the lien later but you cannot place it if you're late.

E. Aaron Cartwright III
214.799.0776
Info@EACLawyer.com

1 person found this helpful
Helpful
Aug 18, 2021

Christina - you mention filing a lien 20 days after the entire project is finished. But as a Subcontractor, isn't our mechanics lien deadline based upon our last day furnishing work?

0
Report Spam
Aug 20, 2021

Hello,

I'm dealing with this issue now. The reason you are being told to lien within 20 days after the entire project is finished is because your lien deadlines are accelerated at project finish. Basically, if there are any disputed funds, you would need to provide notice and it would be in your best interest to file the lien so as to perfect afgainst trapped funds.

But also, once the project is complete, funds may be paid out to the GC including any funds held in retainage, leaving you needing to perfect a lien against retainage in the 30 day statutory period.

Basically, notice and file in under 30 days and you are good in every situation.

E. Aaron Cartwright III
214.799.0776
Info@EACLawyer.com

0 people found this helpful
Helpful
Aug 20, 2021

Sorry I am confused. Levelset gives us these deadlines for mechanics liens which are based upon our last day on the job. Is this not correct?

 15th day, 3rd or 4th month On residential projects, the deadline to file a Texas mechanics lien is the 15th day of the 3rd month after the month in which the claimant last provided labor or materials.

On non-residential projects, the lien filing deadline is the 15th day of the 4th month after the month in which they last furnished labor or materials to the project. 

0
Report Spam
Aug 20, 2021
Retainage is different. The deadline is actually 30 days after the job is finished, but I would not wait that long.
0 people found this helpful
Helpful
Aug 23, 2021
It depends on whether you have a direct contract with the owner. If you have a contract with the owner, your deadlines start to run from when you finished your work. If you are a sub, your deadlines start to run every month you do work.
 
To further complicate this, beginning 1/1/22, the deadlines change. Beginning with jobs where the main contract is dated after 1/1/22, subcontractors deadlines run from the last month they did wok
 
0 people found this helpful
Helpful
Aug 23, 2021

Hello again!

Levelset, wonderful though they are, are not licensed to give legal advice and the people at Levelset giving you these dates and deadlines are not attorneys.

The attorneys here have the correct information because it's our job to be right and so we have to know all of it. Consider contacting a construction attorney.

E. Aaron Cartwright III
214.799.0776
Info@EACLawyer.com

0 people found this helpful
Helpful
Aug 23, 2021

Thanks to you both. All our contracts are with GCs.

We do have an attorney so I am trying to marry what he is recommending with how Levelset handles things for us.

0
Report Spam
Aug 23, 2021

Hello!

In the future, just have Levelset file your liens within 30 days of you completing your portion. You can always remove a lien but you can never rewind time to meet deadlines.

-Aaron

0 people found this helpful
Helpful
Aug 23, 2021

Aaron - And by filing the lien within 30 days afer we are finished, the thinking is that we are filing a lien well before our deadline of 30 days after project completion, correct?

0
Report Spam
Aug 25, 2021
Yes. I think it is always better to file the lien sooner rather than later.
0 people found this helpful
Helpful