Michigan Lien Recovery Fund Is A Goner
On September 24, 2010
By Scott Wolfe Jr
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Earlier this year, we wrote about pending legislation in Michigan aiming to abolish the Michigan Lien Recovery Fund (read the posts here and here). While perhaps a really good idea…the idea was bankrupt.
Well, the legislation was passed and has now become formal law in Michigan, putting an end to the Michigan Lien Recovery Fund. It will be interesting to see what happens to all the litigation that was pending before the fund ran out of money, and whether the state entertains the idea of this fund once its economy gets better.
For now, those are all future questions. Stay tuned.
Interested in reading the legislation’s full text? Download PDF here.
Related posts:
- Michigan Lien Recovery Fund Raises White Flag
- Changes to Lien Law Pending in New Jersey and Michigan Legislatures
About the Author: Scott Wolfe Jr
Scott is the founder of Zlien, a nationwide mechanics lien and preliminary notice filing service. Zlien publishes the Construction Lien Blog, and has done so since 2007. Scott has been a leading contributor and author on the blog since it's initial publication. Scott is also the founder of Wolfe Law Group, a construction law firm that practices along the West Coast and in Louisiana. He lives in New Orleans, LA, where he was born and raised.
The concept was good but was not without its abuses from all corners. Today there are no HLRF protections, and this will (or should) require suppliers to get back to the basics of issuing credit based on the contractor’s proven history and performance. From the supplier perspective, I think we will see more personal guarantees and tighter credit issuance overall especially in light of Michigan’s overall building, construction, unemployment, and other economic soberings as of late.
Hi Jeff – thanks for stopping by and for the comment. You make very good points about the Recovery Fund. We’ll see how this all turns out…