Filing a mechanic’s lien in any state is fairly inexpensive and easy to do. Legal Document Preparation services like Zlien, for example, perform the task for just $295.00.
While the filing of a mechanic’s lien is effective in and of itself, at times the filing of a lien alone is not enough to get your company paid. And every state’s laws require that within some period of time, your business move it or lose it. In other words, you’re required to “enforce” or “perfect” your lien.
In the construction business, cash can be tight. One option contractors, subs and suppliers might want to consider in these instances is assigning your lien rights to a third party.
Whether lien rights are assignable interests is something that varies state-by-state. However, a construction attorney in Utah – Randy Birch – just published an article on his Construction & Collections Blog about the assignability of lien rights in that state.
The verdict: You Can.
Here is a quote from his recently posted article:
Utah Code section 38-1-26 specifically makes mechanic’s lien rights assignable by stating that “All Liens under this chapter shall be assignable as other chooses in action, and the assignee may commence and prosecute actions thereon in his own name in the manner herein provided.” Utah Code Ann. § 38-1-26 (Lexis 2005); see also Elwell v. Morrow, 28 Utah 278, 78 P. 605 (1904).
The right to perfect a lien is also assignable under section 38-1-26.
Read the full article by clicking here.
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