Filing a mechanic’s lien can often be the best tool for collecting outstanding invoices for construction work and materials. Sometimes, the lien is the only meaningful tool. A mechanic’s lien is a special statutory remedy that permits contractors, subcontractors and suppliers to obtain a lien on real property for labor and materials furnished to a private construction project. However, the Pennsylvania Mechanic’s Lien Law (the “Act”) is not user-friendly. Making things more difficult, the Pennsylvania courts have repeatedly held that the extraordinary remedy of a mechanic’s lien requires strict compliance with the requirements of the Act. Put simply, what you may consider to be a minor flaw, mistake or oversight, could likely result in losing the lien altogether.
As a lawyer, I see both sides of the mess that can be created from a faulty lien claim. In some instances, I get a call from a disappointed claimant who just lost or is about to lose the lien because of a legal glitch. My typical response, after gently admonishing them for leaving me out of the loop, is to explain what they already know; they are now in line with all the other general unsecured creditors with no lien and stuck with the much more costly and difficult process of pursuing recovery through a conventional collection lawsuit. By the time a judgment is obtained through traditional collection efforts, the money is often gone.
On the other side, I regularly receive contact from owners who want to have a mechanic’s lien removed. In instances where a claim has been filed by an unrepresented claimant, there are often one or more legal flaws in the claim that constitute a basis for the lien to be attacked. In those cases, I get the high-five from my client and the claimant gets the bad news. The further an unrepresented claimant goes into the lien claim process, the more likely it is that it will miss some important step or requirement.
Deadlines to perfect a lien are regularly missed. First, the claim must be filed with the court in the county where the subject property is located within six months after the completion of work performed by the claimant. There can be legal issues regarding determining when the last work was provided, which, if not properly calculated, can result in a fatal flaw by missing the deadline. There may also be pre-lien notice requirements. A notice of intention to file a claim has to be provided to the owner by any party that does not have a direct contract with the owner (subcontractor, sub-subcontractor etc.) at least 30 days before filing the lien. This adds to the complexity of determining deadlines. Essentially, any party other than a contractor must provide the 30-day notice which means the deadline to commence the process is really five months from completion of work.
The form of the claim can be a fatal problem. There are many requirements as to the content of the written claim to be filed with the court. If the form is not correct, even a seemingly minor flaw may be a basis to strike the lien. The actual owner of the property might be difficult to identify precisely. An adequate description of the work actually performed or the property where it was performed can be complicated. It just takes one mistake to lose the lien. Liens have been lost for simple things like failing to attach a copy of the written contract, failing to identify the property owner properly, and not attaching a copy of the notice of intent to file the claim where such was required.
Service mistakes are also common when filing a mechanic’s lien claim in Pennsylvania. The Act has a list of very specific requirements for serving notice of the filing of a lien claim on the owner. The timing, method and form of notice can be confusing. Further, a common mistake is that claimants forget to confirm with the court that notice of the claim was properly served. So, simply failing to file an appropriate affidavit of service with the court in a timely manner can result in losing the lien even though the claim was otherwise properly filed and notice served.
The bottom line is that if you are considering filing a mechanic’s lien, do not procrastinate. File well before the deadline to avoid or to deal with unexpected problems. If there is any doubt about the viability of the lien claim or the filing process, get all the paperwork to a qualified lawyer for review so that nothing is missed. Pennsylvania provides a helpful remedy to contractors and subcontractors, but it requires that all steps and requirements be met exactly. You want to be the one high-fiving not the one pulling out your hair. Plus, I have heard that cursing, in some circles, is considered unbecoming.