California Mechanic’s Lien
Ferguson & Ferguson
Attorneys at Law
September 8th, 2020
What You Need to Know about California Mechanic’s Lien
In the Golden State, some people find it hard to earn the gold that is due to them. To protect them from non-payment of jobs or items that they have delivered, there’s mechanic’s lien in CA that helps them get paid. However, most find that filing a lien can be complicated and confusing at the same time.
If you are one of the contractors or subcontractors with a payment due to you, then filing and getting paid should be one of your priorities. If you are in California, here are some things that you need to know before filing for a lien.
Who Has the Right to File a Claim?
The people who have worked hard to improve a property or those who have delivered construction materials are generally allowed to file a mechanic’s lien. Other people can be involved, such as interior designers, architects, engineers, and many more, but they might follow a different rule from the ones explained below.
The First Step to Do
To protect your rights in filing a lien, you need to serve your preliminary notice to the property owner or the general contractor. Read more about preliminary notice in this site here.
If you are a subcontractor and are working under a general contracting company, ask your superior if they could send a notice to the landowner. There are also times when the owner needed an investor to fund the house or building’s construction. In this case, you also need to notify the construction lender.
The rules differ in each state. You must serve the notice within 20 days after you started doing the work or when you have supplied the materials in California. If you were not able to serve the initial notification within the 20 days, you could still make it, but if it’s late, only the money that you have earned on the 20 days since you sent the letter will be included and not the full amount of the days that you have worked.
What you need is to mail the notice and request a return receipt. Most workers can personally deliver the document into the landowner’s hands, but it’s better to provide proof of the delivery by mail. There are also specific requirements that you need, such as the nature of the work that you will provide, the price of the goods and the labor, and a statement that matches that of a California Civil Code.
Preparing for the Lien
Every mechanic’s lien document that you should prepare in California must contain a detailed description of the property and its address, the property owner’s full name, the hiring company’s name, the amount of money owed, and a detailed report of the work provided.
Filing and Serving the Lien Itself
The preliminary notice is not the lien itself. But when the owner or the general contractor fails to pay or owes you a specific amount, and they are not replying to your messages, then it’s time to file the mechanic’s lien.
In California, you will be given 90 days to file the document from the last day of work. But in the event the landowner has filed for a notice of cessation or completion that indicates that the property’s construction has stopped, you only have 60 days to file. You can know more about notice of cessation here: http://www.businessdictionary.com/definition/notice-of-cessation.html.
You need to do the work in a county reader’s office in California if it is located in this state. The document can be served by personally delivering it to both parties or sending it through certified mail. An affidavit can help you provide proof for services like mail delivery.
In addition to this, it is essential to know that a worker can only file a lien if the job is already completed. There are also times when a contractor could not finish a job because the entire project unexpectedly shut down. In the event that this is not followed and the filing is premature, it can be invalidated by the court. The document should be recorded before 90 days after the completion of the delivery or work.
Filing for a notice of completion is different for contractors and subcontractors. The contractors are given 60 days to file the notice of completion for each property while the subcontractor has 30 days. The landowners may receive the notification in the space of 10 days upon filing.
There are a lot of things that need to be followed when filing a mechanic’s lien. You should follow the law and comply with the rules and regulations to the best of your abilities. However, if you don’t have any idea about what to do, you can get a professional’s assistance to do this for you. They will tell you about the deadlines, and they will ensure that you have the right to file a mechanic’s lien in the first place.
A Final Word
You may not even think about foreclosing a lien, and you want to give the owner some more time and a chance to pay you. Even if you are thinking about these things, it’s still best if you are going to protect your interest and go through the filing procedure. The circumstances may change, and it can be too late for you to act at some point. If you are always following the law, there’s a chance that you can get paid faster, or you will have a strong stand against your adversaries if you didn’t get the money that is due to you.