California Mechanics Lien & Notice FAQs
It’s easy to file California mechanics liens with zlien , the web’s leading all-in-one mechanics lien compliance manager and security platform. Plus, zlien’s platform can help you prepare and file mechanics lien cancellations, preliminary notices, and more. California is a Full Price state. To learn more about California’s mechanics lien law, read the frequently asked questions below.
Frequently Asked Questions
- California Mechanics Lien & Notice FAQs
- Frequently Asked Questions
- California Mechanics Lien Frequently Asked Questions
- Who Can File a California Mechanics Lien?
- When is the Deadline to File a California Mechanics Lien?
- Do I Need to Send Notice the Lien Was Recorded?
- Can I include Attorney's Fees, Collection Costs, or Other Amounts in the Lien Total?
- When is the Deadline to Enforce a California Mechanics Lien, or, How Long is My Lien Effective?
- Will My California Lien Have Priority Over Pre-existing Mortgages or Construction Loans?
- Must the California Lien Include a Legal Property Description?
- Must the California Lien be Notarized?
- Can I File a California Lien if I'm Unlicensed?
- Can I File a California Lien on a Condominium Project?
- Who Cancels the California Lien if/when I get Paid?
- What Are the Lien Waiver Rules?
- California Preliminary Notice FAQs
- Do I Need to Send a California Preliminary Notice?
- When do I Need to Send a California Preliminary Notice?
- What if I Send the California Preliminary Notice Late?
- How Should the California Preliminary Notice be Sent?
- Do I Have to Send the California Preliminary Notice to Someone Other than the Owner?
- Is the California Preliminary Notice Requirement met when sent or delivered?
California Mechanics Lien Frequently Asked Questions
Who Can File a California Mechanics Lien?
The following parties are entitled to mechanics lien rights in California: direct contractors, subcontractors, material suppliers, equipment lessors, laborers, design professionals, and any person providing work authorized for a site improvement. For all parties, of course, it is required that the party provided work authorized for a work of improvement.
Construction managers are a special situation in California. A controversial appeals court decision in the state suggests that Construction Managers Probably Can File a Mechanics Lien in California…Even without a license, but recent legislation was advertised as reversing that. Our review of the case, however, suggests that the case for construction manager lien rights is even stronger after that legislation.
When is the Deadline to File a California Mechanics Lien?
A direct contractor must record his Claim of Lien after completion of the direct contract, and before the earlier of either 90 days after completion of the work of improvement; or 60 days after the owner records a Notice of Completion or Cessation. A claimant other than a direct contractor must record his mechanics lien after the claimant ceases to provide work, and before the earlier of either: 90 days after completion of the work of improvement; or, 30 days after the owner records a Notice of Completion or Cessation.
Do I Need to Send Notice the Lien Was Recorded?
Yes. A copy of the Claim of Mechanics Lien (including the required Notice of Mechanics Lien wording) must be served on the owner or reputed owner of the property. Service may be accomplished by sending the lien by registered mail, certified mail, or first-class mail, evidenced by a certificate of mailing, postage prepaid, addressed to the owner or reputed owner at the owner’s or reputed owner’s residence or place of business address or at the address shown by the building permit on file with the authority issuing a building permit for the work. Service is complete at the time of mailing. Failure to comply with these service requirements will cause the lien to be unenforceable as a matter of law.
This notification to the property owner that the mechanics lien claim was recorded was the subject of substantial changes to California’s lien laws, which took effect in 2012 and 2013. We wrote about this here: New Service Requirement for California Mechanic Liens Explained.
Can I include Attorney’s Fees, Collection Costs, or Other Amounts in the Lien Total?
No. The lien is limited to the reasonable value of the work provided by the claimant, or the price agreed to by the claimant and the person who contracted for the work (less payments already received). However, if you foreclose on the lien, the court may award the prevailing party the money paid for recording the lien, and attorney’s fees, as costs. We wrote an article in May 2013 about a case that deeply explored the complexities of setting your California mechanics lien claim amount. Also, see this frequently asked question article: Can You Recover the Cost of A California Mechanics Lien?
When is the Deadline to Enforce a California Mechanics Lien, or, How Long is My Lien Effective?
California has a relatively short time in which to enforce a valid mechanics lien. In California, it is required that a mechanics lien be enforced within 90 days from the date on which the lien was recorded. If this 90-day period passes without an action being commenced to enforce the lien, the lien expires. However, in California it is possible to extend the time in which an action to enforce must be commenced if the claimant and the owner agree to extend credit pursuant to California law. In this instance, the action to enforce must be commenced within 90 days after the expiration of the credit, but in no case more than 1 year after completion of the work of improvement.
The completion date for a project can be tricky in California. In fact, we wrote a lot about this in the article “4 Gray Areas in California’s Lien Law.” It is highly unfortunate that this confusing circumstance was not repaired in the recent lien law changes. As evidence of how this can get tricky, see a 2012 California appeals court decision which “Gives Leeway to Lien Claimant Who Can’t Make Up Mind About Completion Date.”
Once an action to enforce the lien has been filed in the appropriate court, the complaint must be served on the defendant within 60 days of the filing. Further, proof of serving the summons and complaint on the defendant must be filed with the court within 60 days of the service on the defendant.
Will My California Lien Have Priority Over Pre-existing Mortgages or Construction Loans?
No. A California mechanics lien has priority over liens that attached to the property after the commencement of the work of improvement, or was unrecorded at the commencement of the work of improvement and of which the claimant had no notice. Also, a mortgage or deed of trust that would otherwise be subordinate to a mechanics lien according to the above requirements, and has priority over the mechanics lien after the recording of a valid payment bond if the bond refers to the mortgage or deed of trust, and the bond is in an amount not less that 75% of the principal amount of the mortgage or deed of trust.
Even though general rules exist to guide the parties, you never quite know when unique circumstances will change the fortunes of a lien claimant. See this recent appeals decision where a party was left of foreclosure proceedings and got special treatment: Danger of Leaving Parties Out of a Mechanics Lien Foreclosure Action.
Must the California Lien Include a Legal Property Description?
No. To be valid, a mechanic’s lien in California must only include a description of the site sufficient for identification.
Must the California Lien be Notarized?
No. A mechanics lien in California must only be verified to be valid. See also this article Must California Mechanics Lien Claim Be Notarized?
Can I File a California Lien if I’m Unlicensed?
No. California law requires contractors who are required to be licensed, to actually be licensed in order to file a valid mechanics lien. This law is pretty clear, and we explore it further in “If I’m Unlicensed, Can I File A Mechanics Lien?” The real question is whether you are required to be licensed to perform the work you did. Construction managers, for example, may not be so required: Construction Managers Probably Can File a Mechanics Lien in California…Even without a license
Can I File a California Lien on a Condominium Project?
Yes. In California, you may file a lien against both an individual condominium (for work done to benefit that unit), and against each individual condominium in the association (for work done on common elements) provided you follow the legal requirements, and had the owner’s consent to perform the work.
Who Cancels the California Lien if/when I get Paid?
If the underlying obligation is paid, or if the time for commencement of the enforcement of the lien passes, the claimant may be required to cancel the lien and have it removed form the record.
What Are the Lien Waiver Rules?
California statutorily mandates that all parties on a construction project use certain legislatively designed construction lien waiver forms. This state is one of only 11 states that requires this. If a contractor or owner asks you to use a lien waiver form that does not conform to the statutory form, the waiver will be invalid, and the contractor could get in legal trouble. See this article: The States with Statutory Lien Waiver Forms. Also, California state law prohibits contractors and suppliers from waiving their right to file a mechanics lien in contract. You can learn more about the prohibition of such “no lien clauses” at this article: Where Can You Waive Your Lien Rights Before Payment? Learn More About Lien Waivers
California Preliminary Notice FAQs
Do I Need to Send a California Preliminary Notice?
Yes. California law requires that a preliminary notice must be sent prior to recording a mechanics lien, giving stop payment notice, or asserting a claim against a payment bond as a prerequisite for validity. The failure to provide a preliminary notice to all required parties, and in compliance with the form and time requirements set forth is fatal to a lien in California. However, a laborer is not required to give preliminary notice, and a claimant with a direct contractual relationship with the owner of the property is only required to give preliminary notice to the construction lender, if any.
We have a lot of information on the Construction Payment Blog about the California Preliminary Notice Requirements. Furthermore, check out the below infographic (click on the below image to view full infographic):
When do I Need to Send a California Preliminary Notice?
The notice must be given no later than 20 days after the claimant has first furnished labor or materials to fully protect the lien claimant. A lien claimant who failed to provide a 20-day notice within 20 days of first providing labor or materials may provide the notice at a later date, but will only retain lien rights for materials and/or labor furnished within the 20 days preceding the late notice, and the labor and/or materials provided thereafter.
It’s common to wonder…what if you send notices too late, and can you send notices too early? Check out these two articles:
- California Preliminary Notice Can Never Be Sent Too Early
- Sending Preliminary Notice Late May Still Provide A Benefit
What if I Send the California Preliminary Notice Late?
If you miss the required date, all is not necessarily lost. A lien claimant who failed to provide a 20-day notice within 20 days of first providing labor or materials may provide the notice at a later date, but will only retain lien rights for materials and/or labor furnished within the 20 days preceding the late notice, and the labor and/or materials provided thereafter. A notice should be filed, even if it is late, because the failure to provide a notice at all is absolutely fatal to a mechanics lien in California.
How Should the California Preliminary Notice be Sent?
The Preliminary 20-day Notice shall be given by registered or certified mail, express mail, or overnight delivery by an express service carrier. Return receipt requested is not required. See more at How To Send Notice to Owners – Standard Certified Mail, or Certified Mail with Return Receipt Requested?
Do I Have to Send the California Preliminary Notice to Someone Other than the Owner?
Yes. In California, the preliminary notice must be given to the owner or reputed owner, the direct contractor, and the construction lender (if any).
Don’t know who the lender is? Yeah, that’s a very common issue. Check out this article: How to Find The Lender on a California Construction Project.
Is the California Preliminary Notice Requirement met when sent or delivered?
In California, the preliminary notice must be sent within the 20-day notice period, and actual delivery is not required within the period. The requirement is considered met if properly sent within the period. It’s important to keep and maintain proof that you properly mailed the California construction notice.