Mechanic's liens allow a contractor legal recourse in ensuring payment for his or her work. When working on a client's building or vehicle, the contractor incurs costs from materials, labor and subcontractors. Civil court provides a weak and unreliable means of enforcing payment from a client. A lien, however, may mar the client's house or vehicle title and even force foreclosure or repossession to pay the lien. If you are served with a lien, there are several avenues of response to clear the lien and prevent undesirable outcomes.
Ensure the Lien is Valid
Look at the contractor's preliminary lien notice. A contractor must serve this notice within a limited number of days from the start of work. The exact number of days depends on your state's laws. In California, for example, any work begun more than 20 days prior to the preliminary notice may not be included in a lien.
Call the county recorder's office to confirm the number of days the contractor has to file the lien. Call again after the required period of time to ensure the contractor filed. In California, if the contractor has not filed after 90 days, the lien is void. If the contractor has filed, record the date of filing.
Call the local superior or similar court to confirm the amount of time the contractor has to file a lien-foreclosure lawsuit. In California, if the contractor has not foreclosed on the lien 90 days from lien filing, the lien is void.
Send the claimant contractor a letter if you believe the lien is void requesting lien removal. Make a copy for your records. According to the California Department of Consumer Affairs, the letter should state why you believe the lien is void and fees that the court may award to you if the claimant does not remove the lien.
Petition the court to remove the invalid lien if the claimant does not. If you have to pay an attorney to help, the court may award you compensation at the expense of the claimant.
Read More: How to Enforce a Lien
Posting a Bond
Contact the court to determine the amount of a lien bond. The amount varies by state and county, but attorney Joseph P. Asselta says to expect to pay 110 percent of the lien amount.
Submit the bond to the court. The lien will then transfer to the bond and clear the property's title.
Wait for the contractor claimant to foreclose on the lien in the allotted period to dispute the lien in court.
Wait for the claimant to foreclose on the lien.
File a counterclaim of "willful exaggeration" if you dispute the lien amount.
Compile evidence to prove the willful exaggeration in the form of photos of the work, copies of receipts, etc.
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