Attorneys Fees and Interest

#5 of the Top 10 Misconceptions about Mechanic's Liens

Attorneys fees and interest may be added to both A) The amount stated on a mechanic's lien and/or B) The amount of the judgment entered on the mechanic's lien

Wrong and right.

Attorneys fees and interest may not be added to either
  • A) The amount stated on a mechanic's lien or
  • B) The amount of the judgment entered on the mechanic's lien
The amount stated on the mechanic's lien cannot include attorneys fees and interest. However, a mechanic's lien may note that 10% interest is also owed on top of the principal amount of the mechanic's lien.

Interest can be recovered as part of a judgment on a lawsuit foreclosing on the mechanic's lien. At trial, the amount of the mechanic's lien is determined, and interest on this amount will be added to the judgment amount at the statutory rate of 10% per year. The date from which interest starts is unclear, but is likely the date that the claimant became owed by his customer.

Attorney's fees not included in judgment

Attorneys' fees will not be included in the amount of the judgment related to the mechanic's lien, even if the claimant has an attorneys' fees provision in his contract. However, attorneys' fees are still recoverable from the claimant's customer via a separate cause of action for breach of contract.

Legal right to collect interest

Interest may be recovered via the judgment on the mechanic's lien, but no legal right to interest exists until a judgment is entered, so a claimant may have a hard time negotiating interest with an owner who stands ready to pay the principal amount of a mechanic's lien before a lawsuit is filed or even if a lawsuit is filed but the trial has not yet been held.

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Above article written by:
David J. Barnier,
Partner at Barker Olmsted and Barnier, APLC

Disclaimer -
This article presents a discussion of general laws, rules, and strategies related to mechanic's liens and other construction issues and is intended to provide background information that will assist the reader in understanding the general laws and rules that apply. Examples and hypotheticals are described in this article for the purpose of illustrating these general rules, however no information within this article should be relied upon when analyzing a specific real-life situation.

For each real-life situation that the reader experiences, it is necessary that the reader consult with an experienced construction law attorney to ensure that the reader's specific situation is evaluated. The laws and rules affecting mechanic's liens and construction are extremely complex and no attorney can provide in a writing an explanation that will empower the reader to use only the information in an article to evaluate how the law will apply to a specific real-life situation. In other words, the reader should not rely on the information in this article when addressing a particular real-life situation.