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Mechanic’s Lien Law Changes

Construction & Contractor Disputes and Real Estate Law

As of January 1, 2011 Mechanic’s Lien law has started changing here in California. Two changes are already in effect and the entire section of the Civil Code relating to Mechanic’s Liens has been rewritten and will be effective on July 1, 2012.

One of the two changes currently applicable is a requirement that when recording the lien, the lien claimant must also serve the owner with a Notice of Mechanic’s Lien in the following form:

NOTICE OF MECHANICS LIEN

ATTENTION!

Upon the recording of the enclosed MECHANICS LIEN with the county recorder’s office of the county where the property is located, your property is subject to the filing of a legal action seeking a court-ordered foreclosure sale of the real property on which the lien has been recorded. That legal action must be filed with the court no later than 90 days after the date the mechanics lien is recorded.

The party identified in the mechanics lien may have provided labor or materials for improvements to your property and may not have been paid for these items. You are receiving this notice because it is a required step in filing a mechanics lien foreclosure action against your property. The foreclosure action will seek a sale of your property in order to pay for unpaid labor, materials, or improvements provided to your property. This may affect your ability to borrow against, refinance, or sell the property until the mechanics lien is released.

BECAUSE THE LIEN AFFECTS YOUR PROPERTY, YOU MAY WISH TO SPEAK WITH YOUR CONTRACTOR IMMEDIATELY, OR CONTACT AN ATTORNEY, OR FOR MORE INFORMATION ON MECHANICS LIENS GO TO THE CONTRACTORS’ STATE LICENSE BOARD WEB SITE ATwww.cslb.ca.gov.

Civ. Code, § 3084.

The other change is that the lien claimant must record a Lis Pendens within twenty (20) days of filing the lawsuit to foreclose on the mechanic’s lien.  This requirement is set forth in Civil Code § 3146.

Major changes are also set to start on July 1, 2012.  That will be the subject of a future post.

If you have any further questions about Mechanic’s Lien Law changes and how they may affect a contract you are considering to sign contact Brewer Offord & Pedersen LLP at (650) 327-2900, or visit us on the web at www.BrewerFirm.com.

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