Posts Tagged ‘Lien Contents’

Is Utah’s SCR (State Construction Registry) A Model For Rest of States?

On January 27, 2010        

Since 2005, Utah has maintained a standardized, state-wide system for filing preliminary notices, notices of commencement and notices of completion – the State Construction Registry, or SCR.  The result?  Any supplier, contractor or other interested party can log into the system, search for a project, and know exactly when it started and begun, and who is working on it.

This is a huge time-saver for folks working on construction projects in Utah.   We know the frustration contractors and suppliers have in other states, because we experience them ourselves at Zlien.

The property records offices in counties across the country can be an absolute mess.   Sometimes, its next to impossible for a subcontractor or supplier to locate the legal proeprty description for a parcel of land, the name of the property owner, and whether anything has been filed on the project.  Even though its incredibly hard to find this information, the contractor or supplier may still be responsible to know it.

Imagine if across the country this information was inputted into standardized online registry of construction projects?   That’s how things work in Utah.

In and out of Utah, one of the most compelling selling features of the Zlien service is that we make things simple for you.  After all, running your construction or supply business is difficult enough that you shouldn’t have to be research experts, or monitor lien and notice requirements across the 50 states.  How is this for simple:  You give us the project details, and our staff researches the property owner and the legal property description for you.

This can save your company hours, and since we’re more experienced at searching for this data, our search results are reliable.

Even thought the information is more accessible in Utah, that doesn’t nullify our utility.  You give us the project information, and we do the leg work.   Forget about spending an hour or two figuring out the SCR system, or having to followup with the city, or having to verify information by doing research online.

Zlien is the smarter way to lien, and we guarantee it.

Posted in:     Lien Management, Our Services & Us  /  Tags: , , ,   /   1 Comment

Washington Law Protects Contractors from Dangers of Frivolous Lien Statute

On July 7, 2009        

A quick word from the construction law case files:

The Court of Appeals, Division 1, out in Washington state, has refused to deem a construction lien as frivolous based upon the complexity of the construction contract at dispute. The court in SD Deacon Corp. of Washington v. Gaston Bros. Excavating, Inc., decided back in May of this year, that the state’s “frivilous lien” statute, coded under RCW 60.04.081, requires a more in-depth analysis of factual circumstances surrounding the substance of the contract and the lien.

The court in SD Deacon further reasoned that a court can only evaluate in a frivolous lien proceeding are, by way of example, whether the lien was properly filed, signed by the proper party, properly served, and meets the statutory form requirements. Issues of substance of the lien (i.e. the contract amount, amount due or change orders) are issues which require more substantive proceedings to analyze factual circumstances.

Because the frivolous lien procedure codified in RCW 60.04.081 does not provide for such proceedings, a party seeking to extinguish a lien filing will be unsuccessful in attempting to show to the court that the lien was frivolous.

Essentially, the court’s new rule is that the “lien must be so devoid of merit that the claim has no possibility of succeeding” and that “there must be findings supporting the conclusion that the lien is invalid beyond legitimate dispute.”

The Court’s ruling provides some hope for “fringe” contractors who’s claims hold some element of uncertainty, but who desperately need the security provided by a lien in order to collect payment from an uphill contractor or owner.

The frivolous lien statute was enacted to prevent fraudulent claims against contractors, by awarding successful parties attorneys fees. The ruling in the case shows that the award of fees will not be granted unless your lien fails to meet statutory form requirements.

Zlien, Inc. has the knowledge and experience to meet these stringent requirements. Let us help you ensure your lien’s success!

Posted in:     The Legal Corner  /  Tags: , , , , , ,   /   Leave a comment

What Costs / Labor To Include In Your Lien?

On February 15, 2009        

It’s been an interesting week on the web as it relates to mechanic’s liens, as I’ve run across a number of web posts about the types of services that can be included in a lien.

Let’s look at the matter theoretically.   Construction lien laws are normally drafted to protect contractors, who invest labor and expense into the improvement of a property.  However, since the laws also balance the property rights of persons or organizations, each state certainly does something to qualify what types of labor and expense can be represented in a lien, and which cannot.

The question here, therefore, is quite simple:   have you performed work or provided materials that can be the subject of a lien?

It’s one of the most important questions a contractor or supplier can ask when determining how to best collect on a non-paying account or project.   If you work does not qualify for a lien, for example, there is no need to even consider if notice is required and other lien filing requirements.

It’s important to consult the laws or your particular state to determine what type of materials and labor can be the subject of a lien, and which cannot.  However, two recently decided cases in Virginia and Kentucky are revealing of some general principals that are followed by most states.  The principal is essentially this:  you can only lien for labor and materials that actually go into improving the property.

What does this exclude?

In Virginia, Virginia Lawyers Weekly reports that a Hanover County Circuit Court invalidated a mechanic’s lien filed by a contractor that incurred costs in anticipation of construction of a steel building, but did not provide labor or materials actually employed in construction of the building.

The case is captioned Dallan Construction Co. v. Super Structures General Contractors, Inc, and can be downloaded here.

Similarly, in Kentucky, the Kentucky Court of Appeals held that “mowing, trimming, edging and street cleaning” did not “permanently improve the property,” and therefore, a mechanics lien was not allowed to be filed for the services provided.  That case is discussed at the South Carolina Community Association Law Blog, and is captioned Steeplechase Subdivision Homeowners Association, Inc. v. Thomas, Ky. Ct. App. 2008.

Posted in:     Mechanic Liens, The Legal Corner  /  Tags: , , , , , , , ,   /   4 Comments

Virginia’s Interesting 150 Day Rule

On January 1, 2009        

In most states, a contractor only has 1 lien deadline of concern:  when the lien must be filed.  In Virginia, however, contractors must juggle two lien deadlines.

First, like other states, Virginia has a regular lien filing time requirement.  All liens must be filed within 90 days from when labor and services were last performed by the contractor.

Unlike other states, however, Virginia has an interesting second deadline, referred to in the state as the “150 day rule.”

From the last day of work, the claimant must count backwards 150 days.   Generally speaking, a contractor is not allowed to include any labor or materials supplied outside this window in its mechanics lien.

While the 150-day rule does not apply to retainage funds or sums not yet due because of a “pay when paid” clause, it usually applies otherwise, and will invalidate a lien if it includes sums due not within this 150-day window.

As mentioned in a previous post about the “payment chain” in Virginia,  an arguable third deadline of concern in that state, subcontractors and suppliers in Virginia have extra motivation for filing liens immediately upon non-payment.   The 150-day rule in Virginia is even further cause.

Posted in:     Mechanic Liens  /  Tags: , , , , , , , , , , ,   /   1 Comment

Caution: Lien Laws in are Hyper-Technical

On December 29, 2008        

In most states, the liens laws are hyper-technical.   This means that the laws have many requirements, and that courts strictly construe the rules against the party filing construction liens.

This is true for nearly every state.

While laws across the nation provide lien rights to those in the construction industry, because of the power of these instruments most states require that the liens be filed in exact accordance with the law to be valid.

This is especially the case with regard to the required contents of a lien.

Each state has different requirements for what must be stated within a mechanic’s lien, and how that information must be stated.

Every state, for example, will require the claimant to identify the property being liened.  In Louisiana, Washington and Virginia, however, the law requires that the lien use the legal property description and not simply a municipal address.   The proper identification of property can be so important we’ve written an entire blog post about it here.

In Virginia, the laws are even stricter.   Because the Virginia lien law is land record based, the claimant is expected to perform a complete title search to acquire the exact legal owner and legal property description.   A lien that does not lien the exact owner, at the exact property for the exact amount due, can be deemed invalid by courts.

Zlien does this leg work for your company, helping your company properly prepare these important legal forms.   Our professional legal document preparers are familiar with the lien and notice forms in your state, and can help your company Lien Smarter.

Posted in:     Mechanic Liens  /  Tags: , , , , , , , , , , ,   /   1 Comment
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