I'm a designer and hired a general contractor to install the remodel of my client's bathroom. The contractor started acting very irrational three weeks into the job, suddently demanding immediate payments we hadn't agreed to, accusing me of operating illegally, mishandling the project, etc! I've given him more money to finish the job, which has been delayed by him significantly, yet he keeps demanding more and more money and threatened to walk off the job. He also called my client and threatened the same thing.Today he called my client and threatened to put a lien on his house unless he paid him $1,500 right now! My client is furious with me, and I don't know what to do. Can the contractor put a lien against his house for payments we haven't agreed to, & work he hasn't completed?
No. A general contractor cannot record a mechanic’s lien until he or she has substantially finished with the entire and overall project. A subcontractor or supplier, on the other hand, can record a mechanic’s lien when their portion of the work is substantially completed, even though the overall job is still continuing.
If a contractor or subcontractor prematurely records mechanic’s lien, the contractor/subcontractor can re-record the mechanic's lien to preserve their rights, as long as the lien is filed within the applicable time deadline.
If a mechanics lien is inappropriately filed, the property owner may file a lawsuit against the contractor/ subcontractor/supplier who filed the lien and if the court finds in favor of the owner, the contractor will be responsible for all actual damages incurred as well as the plaintiff's attorney’s fees and costs.
Under the California Mechanics' Lien Law, any contractor, subcontractor, laborer, supplier, or other person or entity who helps to improve real property, but is not paid for his or her work or supplies, has a right to place a lien for the work that was performed. The question becomes what portion of the work has been completed? The entire project does not need to be substantially completed for the mechanic's lien to be recorded.
For basic information regarding mechanic's liens, see the CSLB website:
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Real Estate Attorney
No. If contractor signed agreement with you and not homeowner they have to give homeowner a 20 day preliminary notice before recording a lien. The lien can only be for the amount owed, not for work to be performed in the future. Change orders must be in writing or approved by you. Contract price has to be spelled out.
You can report contractor to the CSLB. See weblink.
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