A mechanic’s lien is a legal tool that allows construction contractors and suppliers to get paid for their work.
A properly filed mechanic’s lien provides the unpaid contractor with a security interest in the property on which the work was performed.
State laws govern the rights and procedures regarding mechanic’s lien enforcement. In most states, including the state of Virginia, the contractor must follow the laws very carefully or the contractor can lose its lien rights.
A property owner in Virginia has a number of options for dealing with a mechanic’s lien that has been filed on the property.
What The Property Owner Can Do
The options available to the property owner depend on a variety of factors, such as whether there is a dispute with the contractor about the work performed or the amounts owed and the complexity of the project itself.
If there is no dispute about the amount owed to the contractor, the property owner can pay the lien amount. Once paid, the contractor should remove the lien. If the contractor fails to remove the lien, the property owner may have to bring a lawsuit to have it removed.
If the property owner wants to contest the lien because of a dispute with the contractor, the property owner may need professional assistance.
Depending on the nature of the project and the lien amount, the property owner can get help from a real estate lawyer or title expert to determine the best path for clearing the lien.
Determine If The Mechanic’s Lien Is Facially Sufficient
Because the lien laws in Virginia are fairly strict, the property owner may be able to successfully contest the lien and invalidate it based on the contractor’s failure to adhere to the lien law requirements.
The property owner or the property owner’s attorney should initially review the mechanic’s lien document and determine whether any of the following facts would support an action to contest the lien.
Is The Contractor Licensed In Virginia?
If the contractor is not licensed by the Virginia Board for Contractors for the work performed, the contractor is probably not entitled to lien rights.
One easy way to find that information is on the lien form itself, which requires the contractor to state its license or certificate number and their expiration dates. If that information is blank, the lien is likely invalid.
Was The Mechanic’s Lien Filed Timely?
The contractor must file a mechanics lien within 90 days from the last day of the last month in which the contractor furnished labor and/or materials to the project.
It must also be filed within 90 days from the completion or termination of the project. The lien may only cover amounts for labor and/or materials provided in the 150 days preceding the day labor/materials were last furnished by the claimant.
If the lien includes labor/materials provided more than 150 days from the last day the contractor furnished them, the lien will be invalid.
Does The Mechanic’s Lien Form Contain All Of The Information Required?
Minor errors will not invalidate the lien, but certain information must be accurately provided, such as:
- Owner’s name and address
- Contractor’s name and address
- Contractor license/certificate number, date of issuance, and expiration date
- Description of labor and/or materials
- Amount claimed
- Brief property description
- Date from which interest is claimed
- Certification of service of lien on the property owner
- General contractor’s name and hiring subcontractor’s name (if applicable)
Is The Contractor’s Signature Notarized?
The contractor’s signature must be notarized or the lien is invalid.
Has the general contractor already been paid?
If the property owner has already paid the general contractor, the lien is not valid.
Was the lien filed in the right place?
The mechanic’s lien must be filed in the property records of the county where the property is located.
What to Do If the Lien Appears Valid
The property owner should discuss strategy with an experienced real estate attorney. The options available to the property owner include 1) negotiating with the contractor to settle any dispute and paying the amount the parties may agree to, 2) initiating a suit against the contractor in court, or 3) wait and see if the contractor initiates a legal proceeding to enforce the lien.
The third option puts the burden on the contractor to take the steps necessary to enforce the lien.
In Virginia, the contractor must initiate an action to enforce a mechanics lien within the later of six months from the date the lien was recorded or within 60 days from the completion or termination of the project.
This deadline cannot be extended. If the contractor fails to meet those deadlines, the lien becomes unenforceable.
However, if the contractor acts to enforce the lien timely, the property owner can enter into settlement negotiations to resolve the matter or assert a full-blown defense.
For More Information About Mechanic’s Liens in Virginia, Contact Mathis Title Company
Mechanic’s liens can encumber a property and interfere with the transfer of title to the property or refinancing a mortgage on the property.
Get help with mechanic’s liens from the title experts at Mathis Title Company for any real property transaction in Virginia.