Home>Levelset Community>Legal Help>we are on a Public works project owned by the state. We already filed the payment bond. why would we need to file a Mechanics lien as well. (in California)

we are on a Public works project owned by the state. We already filed the payment bond. why would we need to file a Mechanics lien as well. (in California)

completed a big project at LAFC - New soccer stadium in LA, CA. we never filed a prelim or anything. We were told we needed to file a payment Bond since the property is owned by State of California. that has been completed. Now im being told that i may need to file a mechanics lien as well?? it doesnt make sense to me. I would think maybe a Stop notice or something else. Job is done. It was a Union job too if that matters and job is done.

1 reply

Aug 8, 2018

Stadium projects can be a mess. While a project may seem public or private on its face, underlying factors might complicate whether the project is truly considered public or private. Regardless - the presence of a payment bond does not necessarily indicate that a project is definitely public. In fact, the California Civil Code goes to great lengths to explain scenarios where a payment bond might be utilized on a private project: Can You File a Bond Claim on a Commercial Project? In a situation where a project is considered a commercial or otherwise private job, a payment bond may be in place on the project and lien rights may be available. In such a case, both a mechanics lien and a payment bond claim could be claimed on a given project in attempt to compel payment - and deciding whether to file one, both, or neither is ultimately up to the claimant. Of course, if a project is truly a public work - then a lien claim would likely not be appropriate, and a bond claim would be the most appropriate remedy. Finally, it's also worth noting that when a preliminary notice is required and not sent, a valid lien claim likely cannot be filed - and we discuss that idea in depth here: What is a California 20-Day Preliminary Notice? Lastly, regarding a stop notice - a stop notice can be extremely effective on both private and public projects. Note, though, that they will really only be effective when final payment has not yet been made. Because a stop notice halts or freezes funds between parties up the chain, if payments have already been made to those parties, there are no funds to "stop" - limiting their effectiveness.

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