Protecting cash flow Is all about the security measures credit managers have in place to protect themselves if business gets dicey, Before the first Item Is even shipped, creditors must evaluate the mechanic's lien
rights or bond rights to help the sub figure out the extent to which they are exposed and the extent to which the creditor is exposed, Depending on the state and the project, some subs will have readily enforceable mechanic's lien
By way of background, a mechanic's lien
is a statutory device used to ensure that contractors and subcontractors are paid for the value of the improvements they make to real property.
In June 2016, CES perfected a mechanic's lien
on the Brookline property by recording a notice of contract in the Norfolk County Registry of Deeds pursuant to G.L.c.
has been providing Mechanic's Lien
Release Bonds and other surety bonds since 1949 and now brings them to the modern age.
While the condo owners did have a pecuniary interest in the outcome of Rinker's action, a mechanic's lien
action "implicates real property rights and resolution of such an action could defeat or diminish the interest of a person with a property interest in the real estate subject to the lien," Oblon wrote.
In Decon, a property owned by a borrower (a limited liability company) had a first deed of trust held by the lender, and a junior mechanic's lien
held by a third party.
On July 1, 2008, plaintiff filed a verified complaint for foreclosure of its mechanic's lien
and alleged a breach of contract.
To enforce a mechanic's lien
, one must follow the statutory procedure to "perfect" the lien within :120 days after the services are performed or the mater a s are furnished To perfect a lien, one must commence suit for the" amount owed, obtain an attachment, and record the attachment in the registry of deeds in the county where the property is located.
The New Mexico Supreme Court on review found that Hutchens was not required to hold a contractor's license to file a valid lien, but Hutchens had been no more than a miner that simply "dug gypsum from an open-pit mine," and therefore could not file a valid mechanic's lien
Conversely, full price lien states do not limit lien rights to unpaid funds between the general contractor and owner, meaning the owner can be subject to paying twice as long as the mechanic's lien
is properly filed.
Filing a claim of mechanic's lien
can help these workers get paid if the client refuses to compensate them for their work.
A condo developer successfully petitioned to invalidate a subcontractor's mechanic's lien
on the individual condos after the general contractor reportedly went bankrupt.
Homeowners were entitled to summary discharge of a mechanic's lien
filed by a contractor that could not produce the original contract referenced in its filing but later produced a nearly identical contract for a different amount, a Superior Court judge has decided.<br />The original agreement referenced in the notice of contract that the plaintiff, Atlas Contracting, filed to perfect the lien was for $240,294.
It also characterized a contractor's failure to comply as "unlawful." That had the unintended effect of leading some courts to rule that any violation, no matter how minor, barred a contractor from seeking compensation or asserting any mechanic's lien
for his work.
The laws governing mechanics' liens and the use of bonds to protect against lien enforcement vary from state to state, but in almost all states, the standard solution when a mechanic's lien
has been filed is to cancel the lien by filing a bond.