A Simple Guide to Get or Fight a Pennsylvania Mechanics Lien

A Simple Guide to Get or Fight a Pennsylvania Mechanics Lien – From A Top Construction Lawyer

October 25, 2023
9:16 pm

What is a Mechanic’s Lien?

A mechanic's lien guarantees payment to builders, contractors, or construction companies that build or repair structures in any given construction project in case of the liquidation or bankruptcy of the project. If you are a contractor, developer, or property owner in Pennsylvania dealing with mechanics liens on your construction project, you know how frustrating and stressful it can be to either not get paid or not be able to pay. Getting hit with a lien can grind your project to a halt and put your budget and schedule at risk. On the other side, if you are a contractor or supplier who hasn't been paid, filing a mechanics lien may feel like your only recourse to get the money you are owed.

Handling mechanics liens in Pennsylvania can be complex, with strict deadlines and procedural requirements. Having an experienced Pennsylvania construction lawyer on your side is key to properly filing or defending against a mechanics lien. This guide will overview the basics of how mechanics liens work in PA, and provide advice both for filing a valid lien as a contractor, and defending against a suspect lien as a property owner

Our team of Philadelphia construction attorneys has 35+ years of experience in construction and lien law, and has advised clients in handling construction contracts & negotiations, liens, and codes. Call Davis Bucco & Makara today at 610-238-0880 for more information.

How Mechanics Liens Work in Pennsylvania

Mechanics liens allow contractors, subcontractors, suppliers, and design professionals to place a lien against the property to secure unpaid bills for work or materials provided for the project. Some key characteristics of PA mechanics liens:

Liens can be filed on private property.
Liens must be filed within 6 months of finishing work on the project.
Liens have priority above all other claims except purchase money mortgages.
Property owners can be forced to pay twice if they pay the general contractor, who then doesn't pay subs and suppliers.

Steps to File a Valid Pennsylvania Mechanics Lien

If you are a contractor, subcontractor, or supplier who hasn't been fully paid for work on a Pennsylvania construction project, here are the key steps to file a valid mechanics lien:

1. Send Preliminary Notice Within 30 Days

In Pennsylvania, subcontractors or suppliers must send preliminary notice to the owner within 30 days of starting work on the project. This puts the owner on notice that you are providing labor or materials and may file a lien if not paid.

2. Send Pre-Lien Notice at Least 30 Days Before Filing

You must send pre-lien notice to the owner at least 30 days before filing the lien claim. This gives the owner a chance to resolve payment issues before a lien is filed.

3. File Your Lien Claim at Prothonotary's Office

The mechanics lien must be filed at the Prothonotary's Office in the county where the property is located, within 6 months of finishing work. The claim should state the nature and amount of your claim.

4. Serve Notice of Filing on the Owner

Within one month of filing, you must serve notice of the filing on the owner. This is usually done by sheriff or process server. Make sure you comply with the rules on service to avoid technical defects.

5. Start Suit to Enforce Lien Within Two Years

To enforce your lien, you must file a lawsuit against the owner within two years of filing. If you don't enforce the lien in court, it will become void after two years.

Having an experienced Philadelphia mechanics lien attorney guide you through the process is highly recommended, to avoid missing deadlines or technical defects that could invalidate your lien.

How to Defend Against a Pennsylvania Mechanics Lien

If you are a property owner or developer who has had a mechanics lien filed on your Pennsylvania property, here are some potential defenses and strategies to beat the lien:

File a Lien Bond to Remove the Lien

Filing a lien bond for 150% of the lien amount will remove the lien from your property title. This restores your ability to sell or finance the property while the lien is being disputed.

Challenge Service or Notice Defects

Look for defects in service of notices or documents. If the lien claimant missed a notice deadline or did not properly serve the lien, it may be invalidated.

Assert Payment Defenses

If you have evidence you paid the contractor who failed to pay the lien claimant, assert this defense. Or if work was improper or unfinished, file a counterclaim.

Seek to Reduce Amount of Lien

Argue that the lien is excessive and seek to reduce the amount through court. You can also try to negotiate a lower settlement of the lien.

Claim Lien Was Filed After Deadline

One of the most common defenses is that the lien was filed after the 6 month deadline from last furnishing labor or materials.

Attack Technical Lien Defects

Liens can be invalidated if they lack key details about the property, parties involved, or nature/amounts of the claim.

Having a Pennsylvania lawyer experienced in mechanics liens review the claim and build potential defenses is highly recommended for owners.

Key Reasons to Contact a Pennsylvania Construction Lawyer

Strict deadlines - Missing a lien deadline by even 1 day can destroy your rights. A lawyer will make sure deadlines are met.
Complex notices and process service - Improper service of notices or lien claim can invalidate a lien. A lawyer handles service properly.
Lien amount determination- Calculating the accurate lien amount is complex. A lawyer will ensure the amount is supported and stands up in court.
Payment priority issues - An attorney can help get your lien paid first from sale or financing proceeds.
Negotiations and settlement - An experienced construction lawyer can negotiate fair lien reductions or settlements, often resolving liens out of court.
Avoiding liability - Property owners can end up paying twice if they don't manage payments correctly. A lawyer helps avoid double liability.
Enforcement expertise - The process to enforce a lien is complex and requires litigation experience. Lawyers have the expertise to enforce or defend liens in court.

Resolving Mechanics Liens Without Immediately Resorting to Attorneys

While the technical complexities often require legal counsel, some initial options to explore resolving a lien dispute without jumping into litigation include:

Open negotiations - Have an open conversation with the lien claimant to better understand their position and see if a compromise can be reached. Sometimes liens stem from poor communication rather than actual payment disputes.
Alternative dispute resolution - Mediation or arbitration through the American Arbitration Association can resolve lien disputes faster and cheaper than litigation. Both parties must agree to participate.
Surety bond claim - If a payment bond was required on the project, contractors and suppliers may have bond rights against the surety company instead of needing to lien. The surety may resolve claim faster than going to court.
Contact insurer - For defense against invalid liens, notify your title insurer or property insurer, as you may have coverage that helps defend against or remove invalid liens.

Key Takeaways and Next Steps

Mechanics liens are serious and can harm your property rights and budget, but ARE defendable with help from an experienced construction law attorney.
Contractors and suppliers should consult a lawyer early on before commencing lien filing process to avoid critical mistakes.
Property owners should retain counsel as soon as a lien is received to maximize defense strategy options.
While expensive, litigation may ultimately be needed to enforce or defend against a lien if cheaper resolution is not reached first.

What is your next step? Will you keep trying to negotiate on your own with mounting stress and uncertainty? Or is it time to consult an experienced Pennsylvania mechanics lien attorney for expert guidance and confidence that your rights are protected?

Frequently Asked Questions (FAQs) About Mechanics’ Liens

Here are some common questions about Pennsylvania mechanics liens and construction law:

Q: How much does it cost to have a lawyer help with a mechanics lien?

A: Attorneys typically charge an hourly rate, which for construction lawyers varies based on the case, and the attorney’s experience. Simple lien guidance may only take a few hours, but if litigation, then fees can be higher

Q: What happens if I don't pay a mechanics lien?

A: The lien claimant can force a sale of your property through foreclosure to satisfy the lien. Unpaid liens also damage your credit and make it difficult to sell or finance the property.

Q: Can I get damages if a lien is found to be frivolous?

A: If you successfully defend against a mechanics lien and prove it was frivolously filed, you may be able to recover damages for losses caused by the lien.

Q: What is the time limit to enforce a mechanics lien in Pennsylvania?

A: Lien claimants must file suit to enforce the lien within 2 years of filing the claim at the Prothonotary. After 2 years the lien expires and is no longer enforceable.

Q: Do I need a lawyer to file a mechanics lien?

A: No, but it is strongly advised. The deadlines, notices, and procedures for valid liens are complex. Mistakes can invalidate lien rights, so legal expertise pays off.