Can my General contractor's employees file Mechanics lien against my property after I pay the General contractor in full?

Asked about 2 years ago - San Francisco, CA

I heard the workers saying they have not been paid, I wonder how can I protect myself.
If the contractor's employee file a mechanics lien on my property, I can complain to the Contractor's Board and the general contractor's license might be at risk? it's hard to have his employees to sign lien waiver due to they don't even know English.

Attorney answers (3)

  1. George William Wolff

    Contributor Level 13

    7

    Lawyers agree

    Answered . Yes, a contractor's workers - and his subcontractors and suppliers who have served a timely Preliminary Notice upon you - can lien the property, even if you have paid the contractor in full!!.

    If you receive preliminary notices from subcontractors etc, be sue to ask the contractor to give you statutory lien releases from those persons before paying the general contractor. (New lien release forms must be used after July 1, 2012,)

    You can complain to the Contractors License Board, but that might not get rid of your liens.

    Liens usually must be recorded within 90 days of "completion" of the project, or sooner, to be valid, and suit must be brought on the lien within 90 days of recording or it becomes invalid.

    If workers are complaining about not being paid, be careful about paying the contractor or allowing him to do any further work for you, as he may be in financial trouble or be a dishonest contractor.

    You can refer unpaid workers to the California Labor Commissioner in San Francisco for filing wage claims against the contractor.

    There are some articles on our website re lien releases, mechanics liens, etc

    This is NOT legal advice, just a general discussion of the law, as we are not familiar with the specific... more
  2. Timothy John Broussard

    Contributor Level 12

    2

    Lawyers agree

    Answered . Your concerns are valid and each one of these employee claims should be taken carefully. If your contractor has any licensing issues befor the CSLB then there may also be a presumption that these employees are yours under the labor code. Obtaining individual releases would be a wise decision and these employees can file a Mechanic's Lien individually and the 90 day rule post completion may not apply to them. Even if you have already paid the constractor.
    This office would need further information, but speaking to a constrution lawyer is important. Filing a claim with the CSLB may not be sufficient to avoid a Mechanic's Lien Foreclosure Action later by an employee or this contractor's subcontractors.

    Tim Broussard,
    Kring & Chung
    949-261-7700

  3. Nicholas Basil Spirtos

    Contributor Level 20

    1

    Lawyer agrees

    Answered . Employees that have not been paid by the contractor can assert mechanic's liens. You can ask the contractor to list each of his employees on any release and have them sign it as well. Make sure that at a minimum, you have the contractor give you an unconditional lien release upon each payment.

    Since you are concerned about the employees not being paid, you should demand that your contractor give you lien releases for each of them as well.

    The CSLB would probably not be able to protect you from a lien enforcement action (actually, if there is a lawsuit pending, the CSLB usually waits until the outcome of that lawsuit before doing anything). Eventually, the contractor's license might be subject to discipline or revocation, but with the current lag time at the CSLB, that could take months or years.

    Protect yourself now by getting the lien releases from every employee, every sub-contractor, every supplier. Your contractor should supply them, in English and Spanish for every Spanish speaking employee. Tell your contractor that you will not release any more funds without the releases.

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