Did you recently complete work for someone and never got paid for it? If so, you may have the ability to file a mechanic’s lien against their property to get paid. If you have been unable to resolve your dispute peacefully and get paid, keep reading to see what you can do if you need to get a court involved and a mechanic’s lien filed.
When we discuss mechanics’ liens, we are not talking about searchable projects worth more than a million dollars. Those are a completely different animal. Kaminsky Law can help guide you on how to file a mechanic’s lien to get paid for smaller jobs in the tens of thousands of dollars.
First things first, there are a few important terms that you should know and understanding. You also want to make sure that you follow the correct rules and procedure in order to have the mechanic’s lien properly filed and attached to the property. The following terms will have simplified definitions that apply specifically to mechanic’s liens.
Terms and Definitions to know before you file a Mechanic’s Lien
- Owner: The person that owns the property on which the work was performed.
- Contractor: The person that enters into an agreement with the owner of a property to perform work on their property.
- Subcontractor: The person that enters into an agreement with a contractor to perform work on the property. The subcontractor usually does not deal directly with the owner of the property.
- Substantial Completion of Work: The date when the last materials are delivered or the last substantial piece of work is done to the property. Substantial is important here. Work can be substantially complete even if there is a punch list of items left to do.
Keep in mind that a mechanic’s lien is different from a judgment! They are similar and can be easily confused for one another. A mechanic’s lien is a tool that ensures that there is a lien on the property so you could get payment. This is done at the start, before actually getting a judgment at the end of a trial or legal proceeding.
In practice, let’s say that a subcontractor is hired to complete a kitchen in someone’s home. The subcontractor entered into an agreement with a contractor to complete the work. The subcontractor has brought all the materials to the home and has finished the cabinets. For the most part, the work is substantially complete. There may be a few touch ups left to fix but overall, the kitchen is done and the work is considered substantially completed. Below is a video where you can follow along to hear a more detailed explanation of terms to know before you file a mechanic’s lien.
Know the deadline to File a Mechanic’s Lien
Now that we know the key terms, let’s dive into what filing a mechanics’ lien will look like when it comes to the timeline of events. The diagram below shows you that you have 6 months from the date of substantial completion of the work to file the mechanic’s lien. This is a very important deadline.
Filing a Mechanic’s Lien as a Contractor v. as a Subcontractor
This is where it becomes important to know the difference between a contractor and a subcontractor. Contractors are allowed to file a mechanic’s lien without giving notice to the owner because in theory the owner is already aware of what is going on since the agreement is between the two of them.
However, when a subcontractor wants to file a mechanic’s lien, the subcontractor is required to first give Notice of Intent to file a mechanic’s lien to the owner and the contractor that they went into an agreement with. The Subcontractor has to provide at least thirty (30) days notice before filing a mechanic’s lien. That is a very important thing to remember because a subcontractor needs to start the process of filing a mechanic’s lien much earlier than a contractor. A good practice is within four (4) months of substantial completion.
Why Provide Notice of Intent to Lien?
The notice allows for the owner and contractor to respond and try to resolve the dispute without getting the court involved. Even though a contractor is not obligated to send a notice of intent to file a lien, it is good practice to send one anyway. This is considered a good faith effort to resolve the claim and get paid what is owed, rather than turn the dispute into a much longer and potentially more expensive experience.
For the subcontractor, the notice sent to the owner may place the owner on notice that the contractor hasn’t paid. This can either help resolve the dispute because, if the owner hasn’t paid the contractor, it will push towards resolution. However, if the owner has paid the contractor it may redirect the subcontractor’s efforts to the contractor. If it turns out that the owner has already paid the contractor in full for the work, the dispute is between the subcontractor and the contractor rather than the subcontractor and the owner.
If the issue is not resolved within the 30 days of the notice, the next step is to file the mechanic’s lien with the court. Once the mechanic’s lien is filed and accepted by the court, you now now have 30 days to serve the mechanic’s lien upon the parties involved.
Having the Mechanic’s Lien Served
An important thing to remember is that in Philadelphia, you can use a process server and have someone served relatively quickly. As long as the person that is being served does not try to avoid service like we often see on TV. In the surrounding counties in PA, there is a requirement to have service completed by the Sheriff’s office of that particular county. The Sheriff may not be in a rush to get something served so it is important to keep the dates on your radar to follow up with them if you do not hear from them in the appropriate amount of time.
Once you receive the return of service that you can show the court as proof that the party was in fact served, you then have 20 days to notify the court of service. Failure to do this can get your mechanic’s lien thrown out.
Checklist to Follow Before Filing
We split the above portion into two videos so that it can be a bit easier to digest. If you haven’t seen Part One, make sure you check out our other blog and the video included which has the initial checklist of things you should be aware of before you go to file a lien. You do not want to end up in a situation where you do all the work only to find out that you are not actually able to go about the lien in the way that you thought you could.
Part Two is the timeline of procedures that must be followed in order to properly file a mechanic’s lien. The diagram that we created is at the top of this blog and also included for the video. It is VERY important that you do not blow a deadline in this process because you risk the chance of losing your place in line with the court and the lien being stricken.
The attorneys at Kaminsky Law are licensed in Pennsylvania and New Jersey. We can handle your mechanic’s lien filings in the Philadelphia area, including Bucks County, Montgomery County, Chester County, and Delaware County, aggressively representing small business clients and working to get them results in in the most efficient and cost-effective way.
Call us for a free consultation at 215-876-0800 or head over to our Contact Us page to fill out a contact form.