Lein on home by contractor??

[dlsapp]

I live in Michigan. I hired a small (husband and wife, occasional helper) landscape company to do some inground sprinkler upgrades. It was a verbal agreement. The job was supposed to take about 3 days. After about 30 days they requested some money even though the job was not yet completed and the work was very very poor in some areas (leaking heads, shoddy work, etc). I had previously dealt with them on other projects and was happy with the price and work, so I advanced them $1100 with the understanding that they would complete the job and resolve all remaining issues starting the next morning. They did not show up, nor would they return many calls in the next few days to both home and cell phone voice mail messages. After several days, I became concerned and was able to stop payment on the check prior to them cashing it. Eventually (when the stopped check was returned in about 1 week), they called. I gave them the option of completing the work but they declined claiming that they would put a lein on my home instead. I have since received an estimate from another company that indicated the poor workmanship, poor planning, My understanding is that I must be served and be allowed to state my side of the story before any sort of lein can be placed. Am I correct?

 

[[email protected]]

Every state is different so it is difficult to know but in New Jersey contractors can lien the work before they start the job-- it would not be unusual for a contractor to be able to file a lien against you so you must contact a lawyer in your state to get the right answer. Dont you feel like you owe them something for all the work they did? Your stopping of the check may create a problem for you although i dont want you to loose sleep over it. They did some work and you paid them for that-- you didnt say how much the total job was and how much work they did and when you were supposed to pay so much etc. That info would be very helpful to a meaningful answer.

 

[HomeGuru]

<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:</font><HR>Originally posted by dlsapp:
I live in Michigan. I hired a small (husband and wife, occasional helper) landscape company to do some inground sprinkler upgrades. It was a verbal agreement. The job was supposed to take about 3 days. After about 30 days they requested some money even though the job was not yet completed and the work was very very poor in some areas (leaking heads, shoddy work, etc). I had previously dealt with them on other projects and was happy with the price and work, so I advanced them $1100 with the understanding that they would complete the job and resolve all remaining issues starting the next morning. They did not show up, nor would they return many calls in the next few days to both home and cell phone voice mail messages. After several days, I became concerned and was able to stop payment on the check prior to them cashing it. Eventually (when the stopped check was returned in about 1 week), they called. I gave them the option of completing the work but they declined claiming that they would put a lein on my home instead. I have since received an estimate from another company that indicated the poor workmanship, poor planning, My understanding is that I must be served and be allowed to state my side of the story before any sort of lein can be placed. Am I correct?<HR></BLOCKQUOTE>

In general in order for them to have lien rights, they must qualify to have these rights ie. licensed as a contractor, architect, engineer etc. Otherwise it is not automatic. Believe it or not, those qualified have rights to file a lien without your approval, without you telling your side of the story and can even file a lien on property that they did no work on. Ex. if I was a licensed contractor in your State, I could easily file a lien on your property without even meeting you or doing any work for you. A lien can be filed but there is a show cause hearing to determine whether the lien will attach to the property. Even if there is a dispute over the amount of payment and quality of work done, the judge normally allows the lien to attach.
In your particular case, you need to check to see if this contractor is licensed and if they have lien rights. Even if they do, you have several options such as disputing the lien, bonding over it etc. Even if the lien where to attach, in trial you would prevail and the judge would order it lifted.

 

[Tracey]

The Michigan lien act is in Chapter 570, secs. 1101-1305. I believe it is printed in Title 26, of the Mich. Statutes Annotated, section 316. You can read them at your library or law library, or here: http://michiganlegislature.org/law/GetObject.asp?objName=Act-497-of-1980

In Michigan, a contractor may record a lien ONLY if it is based on a written contract. [570.1114] Since your agreement was verbal, C can't record a lien, though they may still try. However, since the lien is invalid, they can't foreclose it. Any lien expires after 1 year.


Here's basic lien law:
Any person who provides an improvement to real property has the right to assert a lien. [570.1107 or M.S.A. 26.316(107)] Subcontractors & suppliers can also file liens on your house. Make sure you get copies of waivers from all subs/suppliers before you pay a contractor off in full. You can demand a sworn statement from the contractors that lists all laborers, suppliers, subcontractors, etc who might have a lien claim. [570.1110] You are entitled to withhold anough $$ from the contractor to pay off all subcontractors/laborere/suppliers listed in the statement. [570.1110]

A contractor must record a notice of lien within 90 days of the last day s/he provides services to the homeowner. [570.1111] The contractor has 1 year from the date of recording to commence a lawsuit to foreclose the lien. [570.1117] If O cancels the contract before it's completed, C gets to record a lien for the amount of work s/he's done. [570.1120] There is no requirement that C provide O with any notice prior to recording a lien. Subcontractors/suppliers/laborers must provide O with notice within 15 days of recording a lien.


So, tell the bozos that they can't record a lien at all because the contract was verbal. If they do, you'll sue them for filing a false lien. Send the letter certified, return receipt. They will have to sue you in small claims court to get any payment. If they sue, make sure you send them a proper demand (before trial) for a statement of all suppliers/subcontractors/etc who may have a claim of lien against the property. No matter how much they win at trial, you get to withhold enough $$ to cover the supplier/subc claims. My guess is that they owe their suppliers, and you don't want to settle with them & then have to pay off a supplier lien too!

You should probably just sue C in small cliams & get it over with before they can file a lien. Have the work completed by a different contractor who can testify that their work was shoddy & their materials & design substandard. You get to sue C1 for the amount you have to pay C2 that is in excess of C1's bid for the work. This includes any $$ you have to pay to rip out or fix C1's work. Take lots of pictures (35mm) or videotape & have C2 make sure you got the right shots.

Go forth & sue.



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This is not legal advice and you are not my client. Double check everything with your own attorney and your state's laws.

 

[dlsapp]

Thank you for your replies. They were very informative and confirm most of what I originally believed.

To: [email protected] ... FYI

No. I do not feel that I should pay them for the work they did. The original quote was for $1500. I paid for $350 of the parts myself. I have had to put in 4 yards of fill dirt and lots of grass seed trying to cover the damage. They destroyed my beautiful landscaped yard to the extent that it will take a year or more for it to recover. The trenches were not even filled in. There were many areas where you could see the pipe laing in or above the ground. The new contractor tells me that they did the entire job wrong, using the wrong materials. They did shoddy workmanship. The 3-day job started on May 18th. My yard has been torn up through 2 holiday weekends now and I have had to water 1.5 acres by hand for 7 weeks. The system was working fine before they started. It just needed more coverage. Now it is totally inoperable. The new pump to replace the one they ruined by running it dry (trying to prime it) will be here Thursday ($650). The total on the second contractor will exceed $1800. I have many pictures and witnesses to substantiate my claim. Pay them for their work?? I Think NOT.

Have a nice holiday weekend everyone.

Regards, Dave

 

[Tracey]

Clearly you are very angry. You have a very good small claims case against them. You can sue them for $300 (difference in contract price) + $350 ($$ paid for no work accomplished) + $650 (new pump) + some $$ to cover them tearing up your lawn beyond what was necessary for the job + some money for having to water by hand (but not for 7 weeks as you should have mitigated your damages after 3 weeks or so by finding a new contractor). Sue for $1,500 & take in lots of proof, including the old pump! You can find a book on preparing for SC court from Nolo Press at your library or www.nolo.com

Go get 'em!

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This is not legal advice and you are not my client. Double check everything with your own attorney and your state's laws.