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I've been threatened with a lien after my C of O


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By Mat in Rome, NY on 6/19/2008


To be as brief as I can, (in my opinion) my electrical contractor did not do everything they were supposed to. Near the end of my project, I made it clear to them that I had a specific date that I needed to get my CofO by (for the bank). They had jerked me around on numerous occasions by not coming out when they were supposed to, not pulling full days even with material present, etc. Naturally, they were going to miss my deadline, so I had my good subcontractor install many finish electrical items to meet my bank deadline. I was also told by the electrical contractor's worker that they would be back out to my house to finish wiring the basement once I got the CofO. Naturally, this never happened. 

I was presented a final bill based on the estimate provided at the beginning of their work. I wrote them a letter explaining that I had to pay someone else to do their work because they were delinquent and my basement is one-third wired and that we needed to come to an agreement on the final bill because I didn't get everything they were supposed to do. The returned a letter with a treat to lien my property. 

Questions: I live in NY state, and I already have had my final electrical inspection verified with my city to grant my CofO. The contractor said they have the final certificate and are going to hold it and file the lien unless I pay. Can they still do this if I have my CofO? What options do I have at this point? I believe I have read before it's best to make the payment, get the lien release, and then sue them. Any help I would GREATLY appreciate.


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By George in Wharton, TX on 6/19/2008


I'm a long way from NY, but I know enough to say don't try to O-B your legal defense or as we say "if you represent yourself, you have a fool for a client." I think it's very important you visit an attorney who has experience in construction contract litigation before this goes any further. Even your lawyer will have to review your contract and listen to the facts carefully before he can advise you. Any advice you get from this site as to how to defend yourself would be suspect based on the limited facts you have given. Go find a lawyer you trust, and good luck.

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By Jeff in Provo, UT on 6/19/2008


As George said, you should probably talk to a good real estate lawyer.

That said, in most states, subs that you've had work on your property or suppliers that have delivered things to your property (even if it was a sub that ordered the supplies) can lien you at any time. I may be a little cynical, but I think it is one of the few things in this country where you are guilty until proven innocent. A lien could stop you from closing your mortgage or selling the home in the future.

Since they have just threatened to file the lien, I would prepare for it. Get the sub that you had finish their work give you a bill that only includes the electrical work that he did; get proof that you paid him in full; also get any proof that you can that they failed to meet their end of the deal. Ideally you'd have a contract with penalties for being late and a clause that you can replace them at any time, but we might be a little late for that. Then, I would make copies of all of the evidence that you have, mail them the copies with a letter stating that you are more than happy to put he full amount in escrow and fight the lien, but here is a small portion of the evidence that you will be presenting against them.

When we built our first house, we had liens placed on the house twice, I think. One got resolved with a phone call, a supplier that a sub used had not been paid, but we had paid the sub. The other we had to dispute, so we put the full amount in escrow with the title company - we didn't pay the bill. Then we gathered evidence and presented it. The sub came back with a reasonable resolution, they got paid a reasonable portion, and we got to keep the rest.

Good luck!

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By Mat in Rome, NY on 6/19/2008


Stupidly on my part (or maybe not now that I think about it), we were working off a proposal for work and not a signed contract. They billed me in increments and I paid them since I was witness to the work being done. Naturally, I am disputing the final bill because the work was not completed for the finish electrical. My other sub (who did the work) was witness to their lack of attention, their sub's sleeping on the job, not showing up, etc. as he was there every day.

I know it's a necessary evil regarding lawyers, but I've never had any luck in the past. When I closed on my land purchase, the property was part of another tax parcel that was subdivided. The guy who bought the first parcel (before I bought mine) never settled the issue of dividing the tax burden between the two parcels (it was actually his fault and the seller's). It took me WEEKS to get my attorney to understand my part of the tax burden was 40% and the other guy's was 60% based on the size of the parcels. 

I know, arguing about lawyers is pointless.

I am in contact with my city codes office, they have actually been incredibly helpful with everything during the process and have bent over backwards to help me out. I don't know what they can do, but they can at least help to advise me. I think I may go ahead and pay the bill, organize my information and then sue the subcontractor. 

Then again, they may just be trying to scare me. I have thought of that too.


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By Mike & Carolyn in Smithville, MO on 7/26/2008


We are in Missouri, and the rule here is that the vendor has 6 months from completion of the work (which is typically tagged with the invoice date) to file a lien on the property that the work was done at. So it would not matter if you have the C/O and/or closed on the loan so long as it's in the time line. Different states probably have different time periods that the liens have to be filed in, so you'll have to check.
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By Kenneth in Lees Summit, MO on 8/5/2008


Actually in Missouri it is more complex than this. IIRC a subcontractor cannot issue a mechanic's lien against the property if they are working directly for the owner, unless in the contract they specifically address the right to lien the house for certain conditions. As most of my subs thought I was the GC (and not necessarily the owner), I only had one sub do this properly. The only sub that did this correctly was my fence installer, and thinking about it, a fence installer would work directly for the property owner a majority of the time. Most construction subcontractors do not work directly for the owner, and a handshake agreement (typical of residential construction) isn't going to cut it either.
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