Population in California is soaring and is expected to reach 50 million by the year 2050, according to the Public Policy Institute of California. Along with population growth comes a construction boom, with contractors and subcontractors assigned to building projects all across our state.
Generally, those working on a project are paid according to the terms of a specific contract that they have with either the owner of the property or a general contractor assigned to ensure that specific tasks are completed within the project. However, in some cases, the subcontractor or general contractor does not receive payment and must file a mechanics lien to secure their payment rights.
A mechanics lien is a type of lien provided by Section 8400-8494 of the California Civil Code. The mechanic’s lien allows the contractor or subcontractor to assert a lien against the property for work performed to improve the property.
California’s Preliminary Notice Requirement
Any party who asserts a right to a California mechanics lien must follow a specific and detailed set of rules. Failure to do so could result in the lien being declared void. The first such requirement is the preliminary notice. Under current California law, any claimant who could potentially have a lien on the property is required to furnish a 20-day preliminary notice to the property owner. The notice is designed to alert the property owner of any potential contractors and subcontractors who are working on the property that may later file a claim of lien against the property. The preliminary notice must contain several categories of information, including:
- The name and address of the property owner
- The name and address of the general contractor
- A description of the work to be performed
- The name and contact information of the party giving notice
- The amount of the claim demanded
Failure to follow the law on the issuance of preliminary notice may result in the claimant waiving their lien rights. This is certainly a situation that any contractor will want to avoid to risk not being paid for their work. An experienced construction litigation attorney should be consulted to ensure that all laws and regulations are observed.
Deadline to File a Lien
There are strict deadlines that must be followed to have a valid lien. California law provides that the lien must be filed, in most cases, within 90 days of the date of completion for the entire project. In some cases, this deadline may be reduced to 30 days if the project owner issues a Notice of Completion.
Failure to file a lien within the 90-day window can result in the contractor waiving their lien rights and losing the remedy. This is an unsettling prospect for a contractor or subcontractor that has not been paid for their work on a project.
California Construction Litigation Attorneys
Construction litigation is a complex area of the law. With massive amounts of money at stake and critical deadlines, this type of case must be left to an experienced professional. Attorney Marlene Leiva has over 25 years of experience in California construction litigation disputes and can help walk you through this type of situation.
For your free consultation, call us today at 818-519-4465.