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What should we do if our equipment keeps being moved around on projects?

We're an equipment lessor and we utilize GPS tracking on all of our equipment. We've started to notice on the tracking that our equipment is moving and being brought to other properties without prior permission. When sending notices on projects like this, should we only notice the contract that was signed? Do we have lien rights for the usage of the equipment on the additional properties?

1 reply

Mar 12, 2019

That's an interesting situation - and it's one we see a lot from equipment renters. First, let's look at notices and potential lien rights when equipment is moved. Regarding lien rights, the right to lien will generally arise when labor, material, or equipment is furnished for the improvement of real property. When equipment is rented and moves from one property to another - the equipment's use on multiple properties may well give rise to lien rights in the multiple properties. Still, though - where lien rights arise in multiple properties that are completely separate, multiple claims will be required. This is because a mechanics lien right does not arise against any specific individual - rather, lien rights arise against the property where work is performed. So, in order to preserve the right to lien at two separate properties, if notice is required, notice would need in regards to the work performed at each property. As for how to prevent the movement of equipment from job to job - if moving equipment is not allowed per the rental agreement, enforcing the agreement may become necessary. When equipment is impermissibly moved, that movement might constitute a breach of the contract and entitle the equipment renter to damages. Of course, first warning a customer who's been moving equipment from property to property might be a good idea in order to preserve relationships. To prevent it from happening in the first place, it might help to include some sort of monetary penalty for moving equipment in the contract. A party renting the equipment might be less inclined to do so if they know they might be on the hook for a penalty if the equipment is moved. Yet another option might be to work with a customer who's intending to move equipment from property to property. Discussing the matter with a customer and requesting that project information be given for each location where the rental equipment is brought might be a fair middle ground. Further yet, an equipment renter could even offer the ability to move equipment from one project to the next as an upcharge for customers. Ultimately, there might be many options for preventing a customer from moving equipment to another job site. But, deciding on how to pursue this goal will be a business decision – and the best way to proceed will vary from business to business.

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