unlicensed Handy man who does work for licensed realty property management.

1 month ago

I was approved to do work Via email from property management company for their customers home. However I learned they placed a hold on invoice until they research approvals for the last 60 days plus. Are we able to file a lien on that property, or do I have to file in small claims against the property management company?

Senior Legal Associate Levelset

When unpaid for work that permanently improves property in Arizona, the party who performed work but went unpaid will generally be entitled to mechanics lien rights. Of course, an Arizona mechanics lien claimant must be licensed if their work requires licensure in order to file a mechanics lien. But, not all work will necessarily require licensure.

Note, though, that under ARS 32-1121(A)(4), a contractor whose work will not exceed $1,000 will generally not need to be licensed. So, for projects that don’t exceed $1,000, most handymen performing simple construction work should be entitled to file a lien for their work, regardless of whether they’re licensed. For more on Arizona mechanics lien rights, like deadlines and details on who may file: Arizona Mechanics Lien Guide and FAQs.

Note, however, that in order to file an Arizona mechanics lien, the lien claimant must have sent a 20-day preliminary notice to the owner. If this notice isn’t sent, then no mechanics lien claim can be made. The notice should generally be sent within 20 days of first furnishing labor or materials. Note, however, that notice that’s sent late will still be partially effective – it will preserve the right to lien for the 20 days before the notice was sent, and then the work that’s done afterward. However, work performed more than 20 days before the notice is sent would not be protected. For more on Arizona preliminary notices: Ultimate Guide to Arizona’s 20-Day Preliminary Notice.

Threat of lien may lien to payment, too
Note that the mere warning or threat of a lien claim can often work to compel payment. By sending a document like a Notice of Intent to Lien, a potential claimant can show their customer and/or the property owner that they’re serious about payment. And, considering the drastic nature of mechanics lien claims, owners and customers tend to be more open to payment conversations when they know that a mechanics lien claim might be on the horizon. More on that here: What Is a Notice of Intent to Lien and Should You Send One?

Small claims court
Of course, using or leveraging mechanics liens isn’t the only option to get paid. Pursuing a claim in small claims court might also lead to payment. In Arizona, small claims actions. Of course, recall that if the work exceeds $1,000 – licensure is likely required. So, if the work exceeded $1,000, filing a claim in small claims court as an unlicensed contractor might not be fruitful, regardless of that $3,500 claim limit.

Levelset wrote this article regarding mechanics liens and small claims court that might be helpful here: File A Lien Or Go To Small Claims Court?.

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