Navigating the complexities of mechanic’s liens can be confusing, but it’s crucial to understand what they are and how they function if you own your own business. A mechanic’s lien is a legal claim against property that a contractor, subcontractor or supplier can file if they have not been paid for work or materials. This approach helps to ensure that a business has a better chance of getting paid for its services.
While the term “mechanic” may evoke images of auto repair shops, mechanic’s liens are not restricted to vehicle repairs. They apply to any professional contributing work or materials to a property improvement project.
A tool for securing payment
The primary purpose of a mechanic’s lien is to ensure that the mechanic gets paid for their services or materials. Once the lien is in place, it becomes a part of the property’s public records. This can make it difficult for the property owner to sell, refinance or transfer the property until the lien is settled, providing an incentive for prompt payment.
When to use a mechanic’s lien
Typically, mechanic’s liens come into play when a mechanic hasn’t received payment for their services. Following the appropriate legal procedure is crucial, which often involves sending preliminary notices to the property owner and then filing the lien with the appropriate government entity. Failure to adhere to these steps could render the lien invalid.
What happens when a person disputes the lien
Disputing a mechanic’s lien can be a complex process for the mechanic and the property owner. If the property owner believes the lien is unjust, they may choose to challenge it legally. This generally involves demonstrating that the work wasn’t completed as agreed or that the charges are excessive.
Mechanic’s response to a dispute
If the mechanic faces a dispute, they have a few options. They could negotiate with the property owner to agree or revise the charges. If the conflict escalates, the mechanic can file a lawsuit to enforce the lien. However, this is typically a last resort, as legal proceedings can be time-consuming and costly.
Understanding the intricacies of mechanic’s liens is essential for both mechanics and property owners. Seeking legal guidance concerning one’s rights, responsibilities and options is a good way to achieve this clarity.