Can I File a Mechanics Lien Against a Tenant of the Property?

Summary: Yes you can, but there is a process to follow

Question: I typically contract directly with a property owner. I have used mechanic’s liens as a means of collection with success, but recently a tenant (not the property owner) hired me to provide some landscape improvements. The tenant did not promptly pay me. Can I use the same mechanic’s lien form that I use when a property owner hires me, or do I need a separate form because my customer was the tenant?

Reply: When the contractor’s client is a tenant (and in every situation in which the client is someone other than the property owner), the contractor must serve a California 20-Day Preliminary Notice (“Prelim”) on the property owner. There may be an exception to this requirement when the client is a tenant and the owner has actual knowledge of the tenant’s improvements, but the safe thing for any contractor to do is to serve his Prelim on the property owner under any circumstances.

Upon timely serving a Prelim on the owner, the contractor has preserved his right to record a mechanic’s lien. The same deadline for recording the mechanic’s lien apply as if the owner was the contractor’s client, which is to say that the lien must be recorded no more than 90 days after completion of the project, or 30 days after the recording of a valid notice of completion.

A property owner who is not participating in the tenant’s construction is entitled to record and post a “notice of non-responsbility” by which the owner can protect the owner’s interest in the property from any mechanic’s lien. There are requirements for this notice of non-responsibility in terms of its format, and most importantly it must be posted at the jobsite and recorded within ten days of the owner learning that of the tenant’s construction. Even if a notice of non-responsibility is validly recorded, the contractor still has lien rights against the tenant’s interests in the property, which typically include the structure that is being improved under the contract.

As I say whenever I am providing a short answer to a broad question: “Each situation is unique.” If you are involved on a tenant project and might need to enforce lien rights, involve an experience construction attorney who can help you determine how the law will apply to the particular circumstances of your situation.

Thank you to Dave Barnier for the above response. :) Mr. Barnier is a practicing litigation attorney with Barker Olmsted & Barnier , APLC in San Diego CA and can be reached at 619.682.4842.

The information in this article is based upon California law and is provided for general information, only. The information provided illustrates laws and legal principals in general. Any information or analysis presented in this article is intended solely to educate the reader on general issues. A comprehensive review of facts, documents, and applicable laws is always required before any attorney can competently provide any legal advice regarding any particular situation. In short: Please do not rely on any part of this article when analyzing any specific situation affecting you or your business. Please do retain an attorney to obtain professional advice for your specific situation.

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