Mechanic’s Liens

If you take your car in for repairs and refuse to pay the bill when you pick up the car, does the garage owner have a mechanic’s lien? Actually, the answer is no. While he may have a lien, it is not a mechanic’s lien; it is called a garage keeper’s lien. So what is a mechanic’s lien?

Pennsylvania law gives protection to contractors and subcontractors who perform certain work on real property, giving them the right to place a mechanic’s lien on the property to secure payment for their work. The right of a contractor or subcontractor to place a lien on property is closely circumscribed, however.

Suppose you hire a contractor to build an addition to your house and get into a dispute over payment at the end of the job. Does the contractor have a right to place a lien against your house? Maybe. In order to do so, the contractor must comply with the following requirements:
The work performed must generally constitute a substantial addition or improvement.
Work on the project must actually have begun.
The contractor must file his claim with the Prothonotary of the county within four months after completion of the work.
Written notice of the filing of the lien claim must be served upon the owner of the property within one month after filing.
In the case of a subcontractor, the owner must also be given thirty days’ prior notice of the intention to file a lien before it is actually filed.
Certain construction work is not lienable. For example, liens may not be placed on properties used for purely public purposes, such as governmental buildings, municipal properties, etc. A lien is also not available for work on the property unrelated to the erection, construction, alteration or repair of a building. For example, landscaping is typically not lienable. Demolition, clearing, paving and curbing are typically not lienable unless directly connected to the construction or improvement of a building. Claims under $500 are not lienable. Finally claims brought by persons other than contractors and subcontractors are not subject to lien.

Mechanic’s liens are designed to protect contractors who extend valuable work and materials in exchange for a promise of payment. The right to file a lien may be waived in advance, however, and a stipulation against liens can be signed and recorded prior to the beginning of work on the property. Lenders often require such waivers where improvements are paid for with borrowed funds.
– Curt Ward

Posted in Real Estate / Property