What is a mechanics’ lien?
Colorado law provides a powerful tool for contractors, subcontractors, suppliers and others involved with construction or repair of improvements on real property, to collect money owed to them – a mechanics’ lien. In most circumstances, if you provided labor, materials, equipment, or services for a construction project and you haven’t been paid, you are entitled to a lien on the project and the related real property.
A mechanics’ lien is a security interest, much like a mortgage or a deed of trust, on real property (land) and any construction or improvements on the real property. Like a deed of trust, a mechanics’ lien is paid out of the proceeds of the sale of the real property against which the lien has been filed.
Although it says it is for a mechanic, it is not for use by an auto mechanic who has not been paid for work on a vehicle. Mechanics’ liens can be attached to undeveloped land, existing structures, partially or fully completed new construction projects, and commercial or residential projects.
Who can file a mechanics’ lien?
Lumberjack Lumber Company provided the decking materials for a new apartment complex but didn’t get paid by the subcontractor who ordered the materials to build the decks. The subcontractor who was hired to do all the bathroom tile work didn’t get paid by Premier Construction Management Company who is responsible for the entire project. A-1 Landscaping Company planted 20 new trees at the entrance to the local golf course, but hasn’t been paid. In each of these examples the companies or individuals who provided the materials or did the work and didn’t get paid have a right to file a mechanics’ lien to collect what they are owed.
Does it work?
If you follow precisely all the rules and requirements of the Colorado statutes, your mechanics’ lien will give you a security interest in the construction project and the real property, and will require the owner, developer or general contractor to pay the amounts you are owed. You must, however, follow the laws exactly, and you may have to file a lawsuit.
Bradford Publishing’s helpful booklet “Know Your Mechanic’s Lien Rights: A Guide to Colorado Law,” will give you an overview of the legal process, and provide guidance and instructions about basic mechanics’ lien procedures and forms.