Here is what you need to know about a mechanics lien and some important points to keep in mind when filing it.
What Is a Mechanics Lien?
A Mechanics Lien is a legal claim that can be recorded by contractors, subcontractors, and suppliers against a property owner to secure payment for work performed or materials supplied to that property. This type of lien puts an encumbrance on the property until the debt is paid. State statutes govern mechanic’s lien law, so the rules and procedures for filing it can vary from state to state.
Steps to Recording a Mechanic’s Lien in California
This guide will help you know the basic steps that you need to take when filing a lien so that you can secure the payment you’re owed.
1. Determine if You Have a Lienable Claim
To have a mechanics lien placed on a property, you must first establish that you have a valid claim. For your work to be considered lienable, it must meet all of the following criteria:
- The work must have been performed or materials supplied at the property owner’s or their authorized agent’s request.
- If you are not in direct contractual privity with the owner of the property for the work performed and/or materials delivered, did you send by certified mail, return receipt requested a 20-day Preliminary Notice within the first 20 days of your first appearance on the job, and/or delivery of materials to the property.
- You must not have been paid in full for the work performed or the materials supplied.
- The work performed or materials supplied must have been incorporated into and improved the property.
- You must be able to identify the property on which the work was performed or the materials supplied.
2. Send a Notice of Intent to Lien
Once you’ve determined you have a lienable claim, the first step in filing a lien is to send the property owner a Notice of Intent to Lien. This means that you will be sending them a formal notice informing them that you intend to file a lien if they do not pay you for the work that you have performed or the materials that you have supplied.
You must send this notice within 20 days of the last day that work was performed or materials were supplied.
2. File a Claim of Lien
After you have sent the Notice of Intent to Lien, you will then have to record your Claim of Lien with the County Recorder’s Office within 90 days of the last day that work was performed and/or materials were supplied unless a Notice of Cessation of Labor or Notice of Completion has been recorded, in which case you will have 60 days from the date that either Notice is recorded by the Owner to create and record your mechanics lien, provided you are in direct contractual privity with the owner and supplied both labor and/or materials to the property.
If you are not in direct contractual privity with the owner and/or only supplied materials to the property, then you have only 30 days to record your Mechanic’s Lien following the owner’s recording of a Notice of Cessation of Labor or Notice of Completion.
Either way, you will need the following information:
- The name and address of the property owner
- The name and address of the person or company that you performed work for or supplied materials to (known as the “obligee”)
- A description of the property
- The amount owed to you for the work performed or materials supplied
- The date that the work was performed or the materials were supplied
3. Serve the Property Owner with the Claim of Lien
After you have recorded your Claim of Lien, you must then serve the property owner with a copy of it. This can be done by either having the County Sheriff or a Registered Process Server, serve the property owner with the Claim of Lien, or sending it to them via certified mail.
4. Take Action to Enforce the Lien
Once you have recorded your Mechanic’s Lien, you will then have to take action to actually enforce the mechanics lien and collect payment. This can be done by either negotiating with the property owner to try and reach a payment agreement or by perfecting and foreclosing on the lien.
If you decide to negotiate with the property owner, it is important to have an attorney represent you in these negotiations to ensure you are protected from future lawsuits.
If you decide to perfect your lien rights and foreclose on the lien, you will need to file a Superior Court action to do so within 90 days of recording your Mechanic’s Lien. You will need to hire a licensed attorney to do this for you.
5. File With the Court and Record a Notice of Litigation Pending (Lis Pendens)
A Notice of Litigation Pending (or Lis Pendens in Latin) is a recorded Notice that a civil lawsuit formally informs the property owner that you intend to take action to enforce your Mechanic’s Lien rights and collect payment. This notice must be recorded within 20 days of the commencement of the action to foreclose on the Mechanic’s Lien.
File a Mechanics Lien with Mellor Law Firm
At Mellor Law Firm, we know how important it is to get paid for the work that you perform. That’s why we offer lien filing services to help you secure the payment you’re owed. We can help you determine if you have a lienable claim, record your claim of lien, and take action to enforce the lien and collect payment. To get started contact our experienced team today.