What You Should Know About the Mechanic's Lien Statutes
Helpful Hints for Creditors
Massachusetts radically changed the mechanic's lien law. Among other things, the "new" lien law changes recording and filing deadlines and expands who can use the lien.
However, the law also makes it harder for you to collect your money by complicating timing deadlines. It requires pooling of assets with other lien creditors upon bank foreclosure and gives banks even more leverage. Despite the many faults of the new lien law, you should still use it to help protect yourself from "deadbeatitis".
National Home Center News PRODEALERS addressed the new lien law stating:
When Massachusetts changed its law, it became more difficult for lumberyards to collect from slow-paying contractors and subcontractors. Some of the new laws, including California's, give greater leverage to compel contractors to pay. Others, like Massachusetts', make it tougher to do so. But credit-collections experts say dealers would do well to stay current in their knowledge of local laws if they want to harness all other means at their disposal to collect what they're owed. (Reprinted with permission of National Home Center News).
Citing our Attorney Alan M. Cohen, the article highlights some problems created by the current lien law and some proposed solutions.
Do not be lulled by the longer deadlines. File your Notice of Contract at the start of the job. Early filing and notification to the property owner is fairer to the owner. It also gives your customer that additional incentive it may need to pay you timely, instead of taking your money to pay your competitors or other trade debts.
Do not ignore other collection remedies. I aggressively pursue, where appropriate, ex parte trustee and real estate attachments and reach and apply injunctions. After all, it is your money.
Mechanic's Lien Law: A Nuts and Bolts Summary
I. CONTRACT DIRECT WITH OWNER
If you have a written contract directly with the Owner of the property, then you must timely:
Record your Notice of Contract at the appropriate Registry of Deeds ("Registry") after the signing of the written contract by you and the Owner, before or after the completion date, regardless whether you finished the work in the written contract. Record your Statement of Account at the Registry.
II. CONTRACT WITH GENERAL CONTRACTOR ("G. C.")
If you have a written contract with a person who has a written contract with the Owner of the property, then you must timely:
Record your Notice of Contract at the appropriate Registry after the signing of the written contract, before or after the completion date stated in your written contract, regardless whether you finished the work in the written contract.
You must mail the Owner a copy of your Notice of Contract by certified mail return receipt requested. You should also send a copy to the General Contractor by certified mail. Record your Statement of Account at the Registry. You should also send the Owner and General Contractor a copy of the Statement of Account by certified mail.
III. CONTRACT WITH SUB CONTRACTOR
If you are a Sub-sub-Contractor with a written contract with the Sub-Contractor, then you must:
- Within 30 days after you start work, mail a "Notice of Identification" to the G. C. by certified mail return receipt requested. We recommend that you also mail a copy to the Owner and the Sub Contractor.
- Timely record your Notice of Contract at the appropriate Registry after the signing of the written contract, before or after the completion date stated in your written contract, regardless whether you finished the work in the written contract.
- Upon recording the Notice of Contract, you must mail a copy of the Notice of Contract to the Owner, by certified mail, return receipt requested. You should also give notice to the Sub and General Contractor.
- Timely record your Statement of Account at the appropriate Registry of Deeds and send a copy by certified mail return receipt requested to the Owner, G. C. and sub contractor.
In each of these above three instances (1, 2 and 3), to perfect your lien:
- Within the time set forth in the statute you must sue in the appropriate court.
- Within 30 days after you sued, you must record an attested to copy of the Complaint at the Registry.
Although complicated, when properly used, mechanic's liens can help you get paid for your product, service, or equipment.
This law creates several other pitfalls. To learn more about how the mechanic's lien law can help you collect your debts, contact The Law Offices of Alan Cohen LLC.
The Law Offices of Alan M. Cohen LLC represents clients and sues debtors in Middlesex County, Boston, Bristol County, Suffolk County, Springfield, Hampden County, Norfolk County, Dedham, Plymouth County, Salem, Brockton, Essex County, Cambridge, Worcester, Worcester County, Barnstable County and throughout Massachusetts.
The information you obtain at this site is not, nor is it intended to be, legal advice. Nor shall contact through said site establish an attorney client relationship, absent a formal fee agreement. You should consult Attorney Alan M. Cohen for individual advice regarding your own situation.