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Understanding an Ohio Mechanic’s Lien

If you are reading this site, you probably found out that you have a mechanic’s lien filed against your property. If you are like most other property owners, you have lots of questions and concerns. This is normal. It would be troubling if you didn’t have any concerns or cares about the lien. Attorneys Dan Myers and Samantha Vajskop wanted to help by providing some general and helpful information about Ohio mechanic’s lien law.

At Myers Law, LLC, it’s our goal to provide general information that may help you manage the stress and uncertainty you are experiencing over a recently-filed or recently-served mechanic’s lien. This website provides information to help you understand what mechanic’s liens are, how they impact you, what options you have in dealing with them, and what rights you have that might protect you or help you in your imminent court battle with your contractor.

If you have questions about Ohio mechanic’s liens, this website is for you. While most of the information available is for homeowners or consumers, we provide information to commercial property owners, as well. If you decide that you need legal advice or representation, our qualified attorneys are available to assist you.

This website does not provide legal advice, and our attorneys do not represent you merely because you have reviewed this website or contacted us. However, once you have a written attorney-client agreement with the attorneys at Myers Law, LLC, our experienced attorneys can review with you your legal options and decide what approach is best for your situation.

Mechanic’s Liens Cause Serious Issues

pexels-photo.jpgThere is no sugarcoating it–mechanic’s liens are serious, they are not to be taken lightly, and they require immediate legal attention and advice. Liens not only lead to litigation, stress, and legal costs, but they also endanger your property, your credit, and your livelihood.

Liens can lead to you losing your home or other property. Like a mortgage, mechanic’s liens can land you in foreclosure, with the real risk of losing your home or property to your contractor. If you currently have a mortgage or other lending on your property, it is likely that a lien will automatically put you in default on your mortgage or loan, and it is possible for your mortgage lender to foreclose on their mortgage, as well.

Liens can ruin your credit and force you to put your life on hold. If you are looking to sell your home, liens often prevent the sale from closing. If you are trying to get financing, refinance, or get lending, your financing applications may be denied if you have a lien on your property.

Liens are costly and stressful. Even invalid liens can cost thousands of dollars to remove from your land. Sometimes a contractor will foreclose on its lien, file other claims in court, or let the lien hang over your head for up to six years. These liens can hurt your ability to get other contractors to work for you and to enjoy your home or run your business the way you intended.

With these risks in mind, let’s learn more about what these mechanic’s liens are, what rules contractors and materials suppliers have to follow, and what could invalidate a lien and potentially allow you to avoid these risks.

Ohio Mechanic’s Lien Basics

books-education-school-literature-51342.jpegIn Ohio, mechanic’s liens are basically involuntary mortgages on your property. Ohio law gives contractors, subcontractors, and material suppliers the right to file an Affidavit of Mechanic’s Lien on any property where they had performed labor or delivered materials for a construction project. The lien is supposed to protect the contractor’s or material supplier’s right to payment from a general contractor or the property owner.

In Ohio, mechanic’s liens are specifically permitted and authorized by the Ohio Constitution, Article II, section 33, as well as Ohio Revised Code, R.C. 1311.01 et seq.

Like a mortgage, a mechanic’s lien acts as “security” of the money that a contractor or material supplier claims to be owed. If the contractor is never paid for the work or materials provided, or only partially paid, they may file a lien with the County Recorder’s office for the county where the specific property is located.

Liens can only be filed on the property where the contractor, subcontractor, or material supplier performed labor or provided materials. If you own multiple properties, but only one property had work performed on it, a lien can only be filed on the one property where work was performed–not on the other, unrelated properties.

The lien is really an affidavit that is sworn to by a company’s officer, employees, or attorney, claiming that the company is owed money from either another contractor on the project or from the property owner directly.

If the lien is valid, is filed properly, is served properly, and the property owner is found liable for payment under the lien at court, the contractor or material supplier can foreclose on the property just like a bank could if a property owner defaulted on a mortgage. Because liens often lead to foreclosure proceedings, it is critical to get an attorney involved as soon as possible.

Information That Must Be Included in an Ohio Mechanic’s Lien

pexels-photo-239886.jpegIn order to have a valid lien, the contractor signing or filing the mechanic’s lien must include a lot of specific information required by Ohio lien law. Failure to include this information could make a lien invalid. But remember that including all of this information does not mean the lien is always valid–other issues and problems may exist.

The mechanic’s lien, at a minimum, needs to include the following information, sworn to as true by the person signing the lien:

  • the amount the contractor or material supplier claims to be owed;
  • a legal description of the property on which the lien is being filed;
  • the name and address of the person for whom the contractor or material supplier provided labor or materials (sometimes the owner; sometimes another contractor);
  • the name of the owner, part owner, or lessee, if known by the contractor;
  • the name and address of the lien claimant; and,
  • the first and last dates that the lien claimant performed any work or provided any materials to the property improvement leading to the lien.

This information must not only be included in the lien, but it must be correct and accurate. The contractor or material supplier claiming the lien must sign the lien in front of a notary public, meaning the information in the affidavit for mechanic’s lien must be sworn to under oath. Lying would not only be illegal, but it might invalidate the lien and give the person who owns the property (consumer or business) the right to sue over the fraudulent lien or slander to the property’s title.

Ohio Mechanic’s Lien Law Has Strict Filing and Service Requirements

pexels-photo-862731.jpegContractors and material suppliers who hope to file a mechanic’s lien have to jump through many legal hoops. First, they have to sign and file a lien with all of the required information discussed previously. Second, they have to make sure that information is 100% accurate. On top of those and other requirements, lien claimants must also comply with time limitations, service requirements, and other legal requirements found in the difficult-to-read Ohio’s mechanic’s lien law, R.C. 1311.01 et seq.

If a contractor fails to meet any of the strict filing or service requirements for the lien, that mistake can invalidate the entire lien. It is important to speak with an attorney about whether the lien you are dealing with suffers from any of these defects.

Time Limits for Filing a Mechanic’s Lien in Ohio

There are strict time limits in which contractors have to file a lien against a property, and the time limit depends on the type of property or type of project. It depends on whether the lien is being filed in relation to residential work, commercial work, or other work.

pexels-photo-209282.jpegFor residential projects (one-family or two-family homes and residential condominium units), the law requires that all liens be filed no later than sixty (60) days after the last date work was performed, or materials were delivered by the lien claimant. That means if the lien claimant is the general contractor, the lien must be filed within 60 days of the last date it or any of its subcontractors or material suppliers performed any work or delivered any materials to the project. If the lien claimant is a subcontractor or material supplier, the lien must be filed within 60 days of the last day that subcontractor or material supplier performed any work or delivered any materials. If the work was being done on your home, whether your home is a condo unit, a single family home, or a duplex, the important time limit is 60 days.

For commercial projects like malls, business locations, and stores, the lien must be filed no later than seventy-five (75) days after the last date work was performed, or materials were delivered by the lien claimant. Often, if the property owner, lender, or general contractor filed a “Notice of Commencement” for the project, which identifies the owner, the general contractor, and other project information, then subcontractors and material suppliers need to provide something called a “Notice of Furnishing” so that the project owner knows who the subcontractors and materials suppliers are. This is not required for the residential projects previously discussed.

There are other time limitations for other types of projects (like publicly-funded projects involving schools), but home construction, home improvement, and commercial construction projects lead to the vast majority of mechanic’s liens being filed.

If the lien is filed even one day late, it is invalid.  

The usual sticking point in these cases is how to calculate the last day of work or material delivery. Generally, if the contractor is still performing original contract work (meaning work that it was supposed to do but has not yet completed), that work will extend the last date of work. However, a contractor coming back to perform repair, warranty, or punch-list work (where they are fixing previously defective or improper work) usually does not extend the last date worked. The rules and interpretations vary in each court, and it is critical to discuss the specific situation you are facing with an attorney. There is no general rule that is true across the state on these issues yet.

Mechanic’s Liens Must be Served on Property Owners

pexels-photo-209641.jpegAfter the lien is filed, the lien claimant (contractor, subcontractor, or material supplier) must provide a copy of it to the property owner, and must do so within a set amount of time. In general, contractors and material suppliers have thirty (30) days to serve the lien (provide a copy of the lien) to the property owner.

While a lien will normally be served via certified mail, there are different ways the claimant can serve the lien according to the Ohio Revised Code, R.C. 1311.19. For residential work, these different methods include:

  • having the sheriff, of the county in which the property owner resides, serve the lien using the methods in the Ohio Rules of Civil Procedure;

  • using certified or registered mail, overnight delivery service, hand delivery, or any other method which includes a written evidence of receipt;
  • any other method so long as the property owner acknowledges receipt of the lien, or the lien claimant can prove that more likely than not the property owner actually received the lien.

If the property owner is a company, the lien can be served in the same way (except instead of the county of residence, the county is the one where the principle place of business is located), and also by serving the statutory agent of the company.

If the contractor or material supplier cannot serve the lien these ways within the 30 day service window, they are given an extra ten (10) days in which to post a copy of the lien in some conspicuous place on the premises of the improved property.

Failing to serve the lien or serve it timely makes the lien invalid.

For more information, check out the other pages on this website, contact us, read our blog posts, or our other websites at www.ShieldConsumers.com or www.OhioHomeownerLaw.com

 

The information on all pages of this website is intended as general information, not as legal advice. It should not be relied on as legal advice, and unless you have a signed attorney-client agreement with Myers Law, LLC, Myers Law, LLC does not represent you as your attorney.