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What are mechanic’s liens?

On Behalf of | Mar 4, 2024 | Construction Law |

Construction projects often come with a load of legal terms, and one of these is a mechanic’s lien.

A mechanic’s lien is something employers should understand well because it can greatly affect them and their work.

Learning more about them

Mechanic’s liens happen when there are arguments about payments between employers and subcontractors, suppliers or workers in a construction project. If these individuals do not get payment for the work they have done or the items they supplied, they can file a mechanic’s lien on the property where the work happened.

Mechanic’s liens can throw some serious wrenches into an employer’s plans. First off, they can make selling or refinancing a property tough because they mess with its title. Also, if employers do not deal with the lien, the worker who filed it might take legal action, which could lead to serious consequences like foreclosure.

Staying ahead of the issue

To avoid mechanic’s liens, employers can take proactive steps. Setting clear payment terms in contracts and making sure to pay subcontractors, suppliers and workers on time can help. Keeping detailed records of payments and work done is also important to fighting off any unfair claims of non-payment.

Dealing with disputes

If a mechanic’s lien shows up, employers should not ignore it and assume it will go away. This means those in charge need to talk with the person who filed the lien, show proof of payments or get professional help if the situation gets more tenuous.

Mechanic’s liens can be a real headache for construction employers who need to keep a tight schedule. By understanding what causes them, employers can lower the chances of these long and confusing situations.