Lender’s Lien Has Priority Over Mechanic’s Lien.

A construction project fell through when the developer ran out of money. The construction company filed a mechanic’s lien on the development. In connection with the construction loan agreement, the lender required the developer to assign its rights and remedies under the construction contract, but not its obligations, to the lender, and the construction company was required to consent to the assignment. The trial court determined the construction company’s mechanic’s lien was superior to the lender’s construction loan deed of trust and ordered foreclosure and sale of the property to satisfy the mechanic’s lien. In reversing, the appellate court concluded the construction company’s agreement to subordinate its mechanic’s lien to the construction loan is enforceable. (Moorefield Construction, Inc. v. Intervest-Mortgage Investment Company (Cal. App. Fourth Dist., Div. 1; September 30, 2014) 230 Cal.App.4th 146, [178 Cal.Rptr.3d 709].)