Though mechanics liens are a longstanding part of the construction industry, even the most experienced construction professionals tend to find lien law confusing. This five-part article began with an overview of mechanics liens in Part 1.
Today in Part 2, our Orlando construction attorneys will discuss how a mechanics lien gives you leverage and increases the scope of parties you can rightfully sue.
A Unique Right
Mechanics liens are actually unique to common law countries such as England and the US. Construction is statutorily given the mechanics lien remedy, and construction professionals are wise to use it when needed. An experienced Orlando construction attorney will be able to help you file your mechanics lien correctly.
How a Mechanics Lien Gives You Leverage
If you have filed a mechanics lien, the property cannot be refinanced, transferred or sold before your lien is resolved. Your privilege in the property is a powerful incentive for the owner to pay their debt to you. It is imperative to make sure you know when your lien expires because the owner will regain these rights when it does.
An Increased Ability to Sue
A mechanics lien also gives you the right to sue a greater number of involved parties than you otherwise would.
Under most circumstances, when someone breaches a contract (in this case, withholding the payment you are due), you can sue the offending party—and that party only. No one else breaches any obligations; hence, you cannot sue them.
A mechanics lien changes this scenario. Filing a lien gives you the right to sue not only the person with whom you contracted, but everyone else up the chain. Say you are a subcontractor and have not been paid by the contractor, who has been paid in full by the owner. Even though the owner has upheld their part of the agreement, you can sue them for what is still legally owed to you.
Though that may not seem “fair” to an owner who has paid in full, mechanics lien law essentially communicates that a construction professional’s right to be paid is a priority. Another beneficial aspect of this right to sue is that the contractor is put in a delicate situation with the (presumably frustrated) owner. This provides a huge added incentive for them to pay you.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.