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What am I able to do to collect payment?

I am a restoration contractor in Michigan. I have iicrc certificates for water and mold remediation, but that does not require a license. Your resources say, "If the project is on residential property, only licensed contractors and subcontractors have lien rights." Am I able to file a lien? If not, what can I do to ensure payment?

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Dec 6, 2019

Michigan's Construction Lien Act provides under Section 107(1) "Each contractor, subcontractor, supplier, or laborer who provides an improvement to real property has a construction lien upon the interest of the owner or lessee who contracted for the improvement to the real property . . ." Restoration contractors that provide water and/or mold remediation services do not have lien rights because the work is not considered an "improvement to real property." The term "improvement" under Section 104(5) "means the result of labor or material provided by a contractor, subcontractor, supplier, or laborer, including, but not limited to, surveying, engineering and architectural planning, construction management, clearing, demolishing, excavating, filling, building, erecting, constructing, altering, repairing, ornamenting, landscaping, paving, leasing equipment, or installing or affixing a fixture or material, pursuant to a contract." Now, if you're "repairing" in addition to removing water or remediating mold, then you might have an argument that you're improving real property and entitled a construction lien. At that point, the issue of a builder's license comes to the fore. And, Yes, contractors who make "improvements to real property" must have a residential builder's license or maintenance and alteration license. So even if you don't have lien rights, and assuming your work is not viewed as an "improvement to real property" (as much as you think it is), you can sue on your contract for non-payment in court. In Michigan, claims under $25,000 are brought in district court; claims over $25,000 are filed in circuit court. Claims $6,000 and less can also be brought in small claims court. Here's a link to the forms for use in small claims court - https://courts.michigan.gov/Administration/SCAO/Forms/Pages/Small-Claims.aspx

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