How Do I Contest a Mechanics Lien in Texas?
Full Question:
Answer:
A lien is a claim to property for the payment of a debt, typically one connected to the property. It is the right to retain the lawful possession of the property of another until the owner fulfills a legal duty to the person holding the property, such as the payment of lawful charges for work done on the property. The right of lien generally arises by operation of law, but in some cases it is created by express contract. There are two kinds of liens; particular and general. When a person claims a right to retain property, due to money or labor invested in that property, it is a particular lien.
Liens may arise by express contract; from implied contract, as from general or particular usage of trade; or by legal relation between the parties, such as created with common carriers and inn keepers. To create a valid lien, it is essential that the party claiming a lien should have the absolute property or ownership of the thing or, at least, a right to vest it; that the party claiming the lien should have an actual or constructive, possession, with the assent of the party against whom the claim is made; that the lien should arise upon an agreement, express or implied and not be for a limited or specific purpose that contradicts the express terms or the clear, intent of the contract. In certain circumstances, the lien holder may foreclose on the property if the debt is not paid in full. Liens can generally be removed by the payment of the amount owed. This payment can occur at any time up to and including the stage at which the closing documents for the sale of the property are signed.
Although the terms lien waiver and lien release seem to be interchangeable, a release demonstrates completion and payment, so as to prove any claim has been satisfied, while a waiver demonstrates a relinquishment of a known right. Waivers are typically obtained prior to commencement of any work, whereas releases are subsequently obtained. Waivers of lien must be in writing, give a sufficient description of the real estate, and be signed by the one with authority to file or claim a lien. No payment needs to be made in advance if the subcontractor agrees to release the land from the lien and rely only on the credit of the owner or general contractor for payment of the debt.
A lien waiver is not a general release of claims; it only waives lien rights. A person signing a lien waiver may still have a claim (or multiple claims) against the person with whom it contracted. Therefore, owners may want their contractor to execute a waiver and release of all claims through the date of each pay application in addition to executing a lien waiver.
You are giving up the right to later file a lien only for the amount of the payment. The lien waiver will not necessarily prevent claims for contested change orders, retention, or breach of contract damages (for example — delay damages, impeded productivity, and other consequential damages).
-Interim Lien Waiver. This is used for progress draws or a partial payment. It waives lien rights through a certain date (and not future unpaid bills) and only to the extent of the payment. Many general contractors and owners require these forms to be signed by the person receiving payment before a check is issued.
-An Unconditional Lien Waiver is used after final payment and means just that: fully and finally releases all future lien rights with no later recourse to file a mechanic's lien. It should be signed only if you are assured you have been paid and are satisfied with the amount received.
-A conditional lien waiver is one that you use when submitting a progress invoice on a project, whether it's the first progress payment or the last. It is conditioned upon receipt of payment, and therefore will typically use the words "upon receipt". An unconditional lien waiver is used when payment has been received and cleared the account. Such a lien waiver will typically state that payment has been received.
When a lien waiver takes effect, the right to file a mechanic lien is given up. However, the lien waiver doesn't prevent a contractor from other remedies, such as a claim for breach of contract, etc.
We can assist you with searching to locate forms or we can draft add forms you may need to our database. However, we cannot advise you to use one particular form over another that address the same matter. We can show you what is available. You can take a look at the forms below and see if they fit your need. If they do not, let me know and we may be able to add a form for your need. You may order a form or package by phone by calling Toll Free: 1-(877) 389-0141 - 8:30-5:00 Central Time Zone Monday – Friday.
The following are Texas statutes:
§ 53.052 PROP. Filing of Affidavit
(a) Except as provided by Subsection (b), the person claiming the lien
must file an affidavit with the county clerk of the county in which the
property is located or into which the railroad extends not later than the
15th day of the fourth calendar month after the day on which the
indebtedness accrues.
(b) A person claiming a lien arising from a residential construction
project must file an affidavit with the county clerk of the county in
which the property is located not later than the 15th day of the third
calendar month after the day on which the indebtedness accrues.
(c) The county clerk shall record the affidavit in records kept for
that purpose and shall index and cross-index the affidavit in the names
of the claimant, the original contractor, and the owner. Failure of the
county clerk to properly record or index a filed affidavit does not
invalidate the lien.
§ 53.160 PROP. Summary Motion to Remove Invalid or Unenforceable Lien
(a) In a suit brought to foreclose a lien or to declare a claim or lien
invalid or unenforceable, a party objecting to the validity or
enforceability of the claim or lien may file a motion to remove the claim
or lien. The motion must be verified and state the legal and factual
basis for objecting to the validity or enforceability of the claim or
lien. The motion may be accompanied by supporting affidavits.
(b) The grounds for objecting to the validity or enforceability of the
claim or lien for purposes of the motion are limited to the following:
(1) notice of claim was not furnished to the owner or original
contractor as required by Section 53.056, 53.057, 53.058, 53.252, or
53.253;
(2) an affidavit claiming a lien failed to comply with Section 53.054
or was not filed as required by Section 53.052;
(3) notice of the filed affidavit was not furnished to the owner or
original contractor as required by Section 53.055;
(4) the owner complied with the requirements of Section 53.101 and paid
the retainage and all other funds owed to the original contractor
before:
(A) the claimant perfected the lien claim; and
(B) the owner received a notice of the claim as required by this
chapter;
(5) all funds subject to the notice of a claim to the owner and the
perfection of a claim against the statutory retainage have been deposited
in the registry of the court and the owner has no additional liability to
the claimant;
(6) when the lien affidavit was filed on homestead property:
(A) no contract was executed or filed as required by Section 53.254;
(B) the affidavit claiming a lien failed to contain the notice as
required by Section 53.254; or
(C) the notice of the claim failed to include the statement required by
Section 53.254; and