You completed a project by furnishing labor or materials to a construction site. In the past you’ve been paid on time, but not this time.
If you are a contractor or a supplier, an architect, surveyor, an engineer, or certified interior designer, and have not been paid, you can file a mechanic’s lien to secure payment.
A subcontractor generally does not have a contract with an owner, and the mechanic’s lien will allow him to be paid. This is the only way to protect your rights.
Maryland law specifies how you must file a lien. Understand that you have strong consumer protection rights in Maryland if you follow the correct procedure for filing a mechanic’s lien.
How to File a Mechanic’s Lien
First, you must file the action in the court of the county where the property is located. You must file it within 180 days from the last time you furnished goods or services to the property.
The lien should include a notarized affidavit by the claimant, setting forth the facts of the case that explain why you are due the lien amount.
You should file on behalf of your corporation, which must be registered with the state of Maryland.
One additional thing – if the property is being repaired rather than new construction, the lien is only allowed if the property is being improved by at least 15% of its value.
If you are a subcontractor, preliminary notice is required, but not so for a general contractor. The subcontractor must not be in direct contact with the property owner, and the preliminary notice must be sent out within 120 days from the last delivery of supplies or last working day.
The Maryland mechanic’s lien should include a description of
the land, where it is located, address, zip code, parcel number, and
photographs of the property may be attached.
A copy of the deed with the full legal description will be sufficient to
attach to the lien.
What the Mechanic’s Lien Should Include
Only some things can be covered by the lien, they include: unpaid supplies and labor, and any equipment which was part of the project. You may be able to include interest if that was specified in the contract.
Generally, collection fees and attorney’s fees cannot be included in a Maryland mechanic’s lien, however a court may decide to award the legal fees to a claimant.
Once the lien is filed, the court will ask the petitioner to supplement the complaint, if necessary. If the court is satisfied, it will enter an order that the other side will reply to in a subsequent hearing. If the owner does not appear at that hearing, the plaintiff’s claim will be determined to stand.
Enforcing a Maryland Mechanic’s Lien
Under Maryland law, you may initiate enforcement or payment of the lien within one year from the filing of the mechanic’s lien by filing a Petition to Enforce.
If a lien is not satisfied, a contractor or subcontractor can sell the property to recover the outstanding amount owed.
You basically have to stand in line behind any pre-existing mortgage obligations or construction loans. If several mechanic’s liens are competing, they may have to ultimately share existing funds. Otherwise, the liens will be satisfied upon any foreclosure sale of the property.
The good news is that the mechanic’s lien will have priority over other liens filed after the mechanic’s lien.
Once the lien is settled, the contractor will give the owner a
signed release of the lien. This is supplied to all parties involved. The court
will record the determination of the lien outcome upon payment.
Maryland Mechanic’s Lien Attorney
You may only get one chance to file a mechanic’s lien, and it must be done according to Maryland law.
The Law Office of Matthew S. Evans represents those in the construction trade involved in an unsettled account. The filing of a mechanic’s lien can be a complicated process that can be made simpler with an experienced construction and mechanic’s lien law firm. You do not want to miss an opportunity to collect what is owed you.
Contact our office in Annapolis at (410) 431-2599 to consult with our experienced mechanic’s lien attorney.