Contractor Litigation
Can I file a Mechanic’s Lien?
If you are a general contractor, you have within 4 months (not 120 days) after the last day of substantial work at the job site to file a Mechanic’s Lien.
Generally, any person (or corporation, etc.) who makes improvements to real estate, or supplies materials for the imporvement of real estate, under the following circumstances may claim a Mechanics Lien:
» Under a contract with the real estate’s owner;
» With the knowing permission of the owner;
» Under a contract with someone who has a contract with the owner (or under a contract with someone who has made improvements with the knowing permission of the owner).
About the Mechanic’s Lien
Section 1 of the Mechanics Lien Act also provides that certain professions (such as an architect) and trades (such as a well-driller) can claim a Lien for services related to real estate.
Courts have also ruled that a Mechanics Lien can be claimed for demolition work, provided that the demolition work is part of an overall plan to improve the real estate.
The statutes creating a Mechanic’s Lien usually give it a higher priority with respect to other interests in the title than the law gives most real property security interests. Among other things, priority is the attribute that determines which of several competing security claims will have the first claim to the funds of a foreclosure sale. In this context, the priority of a mechanic’s lien is determined either by the time the lien attaches to the title to the property or by the point in time to which it “relates back.” With some exceptions, the lien attaches or relates back to a time prior to the time that any notice of it appears in the public records.
In many states, this is specified as the time when the first visible construction commences on the building site. In others, it is when the contract is executed for the work to be done. In still others, each contractor or supplier’s lien attaches at the time when it commences its own work. Therefore, persons dealing with the owner of the title to the property risk having their interests unexpectedly subject to mechanic’s liens of which they had no knowledge.
A Title Search must be done
A title search is necessary because it provides a legal description of the property. In order to be valid, a Claim for Lien must identify the real estate against which the Lien is claimed by means of a legal description. Illinois courts have held that a street address is insufficient to identify the property for the purposes of a Mechanics Lien.