How liens work

[Spinal tap]

What is the name of your state? CA

While I was doing some research on a subject on the Ca. State License Board I came across "Mechanics Liens".

How do these work?

I understand that a contractor can put a lien on a customer's property if they don't pay what is owed to the contractor, but what process does the contractor have to follow to make a lien effective? Does he have to present an acknowledgement letter for signature?

For example: If I ask a contractor to do $20 of work for me and I don't pay him, can he then put a lien on my house? Even if it was a verbal agreement and no contract, let alone a "mechanics lien" was signed.

Conversely, can I as a consumer put a lien on a contractor's assets if they don't fulfill their part of the contract? I thought I remember reading somewhere that Arnold Schwarzenegger (sp?) put a lien on his contractor even after the contractor died.

 

[dcatz]

Mechanics' liens are creatures of statute. This is a complex area of law that can differ from state to state and can have very precise requirements that must be met. If you have the time, you can inform yourself of your state's requirements. They begin at Calif. Civil Code sect. 3109 et seq., and you can find that here.
http://www.leginfo.ca.gov/calaw.html

On the other hand, you can do more than "put a lien on a contractor's assets", and that's not as complex. Your state defines a lien as:
"A lien is a charge imposed in some mode other than by a
transfer in trust upon specific property by which it is made security
for the performance of an act."

Your hypothetical presupposes that you get a civil judgment. A judgment lien is created simply by entry of the judgment. In Calif., if you have a civil judgment (even one taken in Small Claims court) against a contractor, it's the basis for suspending the license until the judgment is paid. It's done pursuant to Bus. & Prof. Code sect. 7090.1, and you can read it in the same place.