In the representation of a general contractor who was building a new $500,000.00 residential home for two homeowners, Ms. Stec defeated the homeowner’s Petition to Release the general contractor’s Mechanics Lien and obtained an award for attorney fees after being deemed the prevailing party.
The homeowners filed the Petition to Release the general contractor’s Mechanics Lien claiming the Mechanics Lien was not timely filed and the lawsuit to foreclose on the Mechanics Lien was also untimely. Under Civil Code § 8480 the owner of property subject to a mechanics lien claim may petition the court for an order to release the property from the mechanics lien. The requirements for a Petition to Release a Mechanics Lien must be strictly adhered to and are set forth under Civil Code § 8482. The petition must be verified and include the following information:
(a) The date of recordation of the claim of lien. A certified copy of the claim of lien shall be attached to the petition.
(b) The county in which the claim of lien is recorded.
(c) The book and page or series number of the place in the official records where the claim of lien is recorded.
(d) The legal description of the property subject to the claim of lien.
(e) Whether an extension of credit has been granted under Section 8460, if so to what date, and that the time for commencement of an action to enforce the lien has expired.
(f) That the owner has given the claimant notice under Section 8482 demanding that the claimant execute and record a release of the lien and that the claimant is unable or unwilling to do so or cannot with reasonable diligence be found.
(g) Whether an action to enforce the lien is pending.
(h) Whether the owner of the property or interest in the property has filed for relief in bankruptcy or there is another restraint that prevents the claimant from commencing an action to enforce the lien.
The homeowner’s Petition included the information required under Civil Code § 8482 but failed to make a showing that the Mechanics Lien was untimely, and that the lawsuit was untimely. Ms. Stec presented evidence in the general contractors’ Opposition to the Petition showing the Mechanics Lien was recorded less than 90 days after labor ceased on the project for a continuous period of 60 days. To do this, Ms. Stec not only obtained a declaration and timecards from her client, the general contractor, but also a declaration and payment application from a third-party roofer who performed work on the project. Together, these declarations and supporting evidence provided the court with the basis for finding the Mechanics Lien was timely recorded which rendered the lawsuit timely recorded. The importance of defeating the Petition is that the general contractor can now proceed with foreclosure on its Mechanics Lien through the lawsuit to collect the unpaid amounts for building a large residential property.
In addition to prevailing on the Petition, Ms. Stec requested attorney fees be paid by the homeowners to her client as permitted under Civil Code § 8488. The Court granted the request, finding the general contractor to be the prevailing party on the Petition and ordered the homeowners to pay the general contractor his attorney fees and costs.
For more information on this please contact Lanak & Hanna Associate Attorney Lauren B. Stec, [email protected].
The information contained herein is not advice and should not be treated as such.