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what are our lien options

Hi,We retrofit properties that have been sold and are in escrow. We only perform the city and state requirements of sale consisting of water conservation devices and safety items such as automatic gas shut off valves, smoke detectors, carbon monoxide detectors, water heater strapping etc. We provide escrow with a "Certificate of Compliance" which is needed for them to close. This is our 24th year in business and we perform roughly 5,000 jobs per year.For this property escrow closed and we did not get paid. We have a signed work authorization from the seller. Unbeknown to us escrow had an amendment transferring the retrofitting responsibility from the seller to the buyer. Neither buyer nor seller are wanting to pay the invoice which is $3,150.50. What are our lien options? We would like to place a mechanics lien on the property if possible.Thanks in advance for your help.Fabian Friedman

1 reply

Jan 8, 2019

That's an interesting situation. In California, parties who contract directly with the property owner do not need to provide a preliminary notice unless there is a construction lender on the project. Parties who contract with parties other than the property owner or the property owner's agent must provide a preliminary notice in order to retain lien rights. The only potential claimants exempt from eh notice requirement are wage laborers.

If required, the preliminary notice must be provided within 20 days of first furnishing labor or materials to the project in order to fully protect the claimant. Th notice may be given later, but it will only work to protect the value of the labor or materials furnished beginning on the date 20 days prior to the date on which the notice was given.

If the notice was given, or doesn't apply, a lien must be filed by the applicable deadline in order for the lien to be valid and enforceable. In California, the lien deadline is 90 days from the completion of the work as a whole unless a notice of completion or cessation is filed. If a notice of completion or cessation is filed, the lien deadline is 60 days from that filing for parties who contracted with the property owner, and 30 days from that filing for all other parties.

If the lien claimant is within the time to file a lien, they are generally allowed to do so - whether or not the property has been sold. Since a mechanics lien is a claim against the improved property the owner involved, but really is just kind of along for the ride. In a case where a third party purchases the property before the lien is filed, they will generally be liable to satisfy the lien claim and will then need to seek recovery from either the original owner, or, potentially, the title insurance company, if possible.

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