Project Completion Determines Mechanics Lien Recording Deadline

The California Mechanics Lien is one of the most valuable collection devices available to contractors, subcontractors and suppliers who are unpaid for work performed and materials supplied in relation to a California Private Works project. The mechanics lien allows the claimant to sell the property where the work was performed in order to obtain payment. The process starts with the recording of a mechanics lien in the office of the County Recorder where the property in question is located. As noted below, certain deadlines must be met.

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Penalty for Failure to Release Expired Liens

I was recently contacted by a commercial building owner in the process of trying to sell the building. Two years prior to this, a subcontractor had recorded a mechanics’ lien with the local County Recorder’s office in relation to the owner’s property. The subcontractor recorded the mechanics lien after the subcontractor was not paid by a prime contractor for work the subcontractor had performed on the property. Unfortunately for the subcontractor, the subcontractor then failed to file a lawsuit to foreclose on the lien within the requisite ninety (90) day time period for filing a lawsuit to foreclose on the mechanics’ lien. Since the subcontractor missed this 90 day deadline to file the mechanics lien foreclosure lawsuit, the mechanics lien expired.

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Corporate Transparency Act Who Must File, When to File, How to File

The Corporate Transparency Act (“CTA”) came into effect on January 1, 2024, impacting numerous small businesses throughout the United States. The claimed objective of the CTA is to address the covert nature of corporate ownership, a facet exploited for various illicit activities such as money laundering, terrorism financing, and other financial wrongdoings. Under the newly enacted legislation, businesses meeting specific but common criteria are obligated to submit a Beneficial Ownership Information (“BOI”) Report to the U.S. Department of Treasury’s Financial Crimes Enforcement Network (“FinCEN”).

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Can I be required to mediate, arbitrate or litigate a california construction dispute in some other state?

It is not uncommon in the construction industry for an out-of-state general contractor to include a provision in a subcontract requiring a California subcontractor to resolve disputes outside the state of California even though the work is to be performed within California. Fortunately, most California subcontractors are immune from this tactic. California law generally prohibits clauses requiring subcontractors to travel outside California to resolve construction disputes.

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