Defending Homeowners Against Construction Liens (also known as Mechanics Liens)
Our law firm has experienced, results-oriented construction attorneys. We represent people on a wide range of construction law matters, including fighting for them when construction liens have been filed against their property.
Construction liens used to be called “mechanics liens,” and some people still call construction liens by that name. Regardless of what they are called, however, these liens are potent tools for contractors, subcontractors and suppliers to get paid, because they impose significant consequences on homeowners. When a construction lien has been filed, it will become difficult for a homeowner to obtain financing. In the worst case, the contractor may even be able to foreclose on the construction lien.
Homeowners may find themselves in this predicament in several situations, the most obvious being the contractor is owed money and didn’t get paid. However, there are many scenarios where innocent homeowners can find a construction lien filed on their property when they did absolutely nothing wrong. For example, a contractor may not have completed the work so the contractor withheld final payment. In another example, the work is done and the contractor is paid, but the contractor never pays the subcontractor, so the subcontractor files a construction lien on the property. In both of these examples, the homeowners did nothing wrong yet find themselves with liens on their homes.
Defenses to Construction Liens
New Jersey’s Construction Lien Law, however, provides significant defenses for homeowners, and our construction lien attorneys are aggressive in utilizing them.
· Written Contract. The New Jersey Construction Lien Law requires that a construction lien can only be filed when there was a written contract. In fact, if there was no written contract, or if the written contract failed to contain required information like start and completion dates, right of rescission, etc., it may be a violation of New Jersey’s Consumer Fraud Act, allowing the homeowners to sue the contractor for triple damages and their attorneys fees.
· Notice of Unpaid Balance and Right to File Lien Claim. New Jersey’s Construction Lien Law requires that before any lien on residential property can be filed, a contractor must file a Notice of Unpaid Balance and Right to File Lien Claim (also known as a “NUB”) with the clerk of the county where the property is located.
· Lien Arbitration. The parties must then engage in construction lien arbitration. The construction lien arbitration does not make a final determination on what is (or is not) owed, but merely the amount for which the construction lien may be filed. It is not used in the rest of the case.
· Time Limitations. The NUB must be filed within 60 days after the last work was performed. The lien must be filed within 10 days after the contractor the arbitrator’s decision is received, and in no event later than 120 days after the last work is performed. A lawsuit must be filed within 1 year from the date of the last work, or within 30 days of the homeowner’s written demand.
Contact McLaughlin & Nardi’s Construction Attorneys
Our New Jersey construction lien Lawyers have considerable experience and have achieved significant success in all areas of construction law, including success in disputes involving construction liens. Call us at (973) 890-0004 or e-mail us if you have an construction lien or other construction law issues. We can help.