Subcontractors often work on construction projects without signing a contract with the property owner. Instead, they work for general contractors who oversee the project and handle payments.
If a general contractor does not pay, California law allows subcontractors to file a mechanic’s lien against the property, even if they do not have a contract with the owner. The law says that anyone who provides labor or materials can claim payment by placing a lien on the property.
This law protects people who work on a property but do not receive payment. They can still ask for payment, even without a contract with the owner.
Who can file a mechanic’s lien?
California law allows subcontractors to file a mechanic’s lien if they have not received payment for work that improves a property. This right usually covers anyone who provides labor, materials or certain services for a construction project.
For example, if an electrician finishes wiring a new building but does not receive payment, they can still file a lien, even though the general contractor hired them.
How can subcontractors protect their lien rights?
Subcontractors need to follow California’s notice and filing rules to protect their lien rights. Some of the steps they can take include:
- Sending a preliminary notice: Notify the property owner, general contractor and any construction lender within 20 days of starting work.
- Filing before the deadlines: File the lien within three months after the project ends, or within 30 days if the owner files a valid notice of completion or cessation.
- Including the right details: List the amount owed, property information and any other required information in your lien claim.
- Taking legal action: If necessary, file a lawsuit to enforce the lien within 90 days after you record it.
According to California Civil Code § 8200, most subcontractors must send an advance notice to protect their lien rights. If they send the notice late, it usually covers only work they completed in the 20 days before the notice and any work they complete afterward.
How can subcontractors resolve payment disputes?
A mechanic’s lien gives subcontractors a way to collect payment through the property. However, filing a lien does not guarantee payment.
Before filing a lien, subcontractors should review their invoices and speak with the general contractor about any unpaid work. They should also make sure they met all required deadlines.
If the parties cannot resolve the dispute, a construction attorney may review the contract, payment records and lien documents. This can help subcontractors understand their options and avoid mistakes that could affect their right to payment.