Can the contractor put a lien on my home if work has finished but I have not paid?

Full Question:

My contractor finished work on my house in Gilbert 6/30/08. She did not send me a final bill until 11/08. She has not justified the bill and I call into question the amount. There was not a contract. I have paid her $18,000. Can she still file a lien against my house?
04/03/2009   |   Category: Contractors ยป Construction...   |   State: Texas   |   #15868

Answer:

A lien 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. Liens that arise in construction situations include construction liens, contractor liens, mechanic liens, attorney liens, architect liens and other liens applicable in your state. By virtue of express statutes in most states, mechanics and material men or persons who furnish materials for the erection of houses or other buildings, are entitled to a lien or preference in the payment of debts out of the houses and buildings so erected and to the land, to a greater or lessor extent, on which they are erected. In some states, a claim must be filed in the office of the clerk of the court or a suit brought within a limited time. In some states no lien is created unless the work done or the goods furnished amount to a certain specified sum, while in others there is no limit to the amount.

Liens can be discharged after a certain length of time. If the lien is not renewed, the cloud on the title will no longer exist.

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


(7) the claimant executed a valid and enforceable waiver or release of
the claim or lien claimed in the affidavit.

(c) The claimant is not required to file a response. The claimant and
any other party that has appeared in the proceeding must be notified by
at least 21 days before the date of the hearing on the motion. A motion
may not be heard before the 21st day after the date the claimant answers
or appears in the proceeding.

(d) At the hearing on the motion, the burden is on:

(1) the claimant to prove that the notice of claim and affidavit of
lien were furnished to the owner and original contractor as required by
this chapter; and

(2) the movant to establish that the lien should be removed for any
other ground authorized by this section.

(e) The court shall promptly determine a motion to remove a claim or
lien under this section. If the court determines that the movant is not
entitled to remove the lien, the court shall enter an order denying the
motion. If the court determines that the movant is entitled to remove the
lien, the court shall enter an order removing the lien claimed in the
lien affidavit. A party to the proceeding may not file an interlocutory
appeal from the court's order.

(f) Any admissible evidence offered at the hearing may be admitted in
the trial of the case. The court's order under Subsection (e) is not
admissible as evidence in determining the validity and enforceability of
the claim or lien.

§ 53.251 PROP. Procedures for Residential Construction Projects

(a) This subchapter applies only to residential construction projects.

(b) A person must comply with this subchapter in addition to the other
applicable provisions of this chapter to perfect a lien that arises from a
claim resulting from a residential construction project.

§ 53.254 PROP. Homestead

(a) To fix a lien on a homestead, the person who is to furnish material
or perform labor and the owner must execute a written contract setting
forth the terms of the agreement.

(b) The contract must be executed before the material is furnished or
the labor is performed.

(c) If the owner is married, the contract must be signed by both
spouses.

(d) If the contract is made by an original contractor, the contract
inures to the benefit of all persons who labor or furnish material for
the original contractor.

(e) The contract must be filed with the county clerk of the county in
which the homestead is located. The county clerk shall record the
contract in records kept for that purpose.

(f) An affidavit for lien filed under this subchapter that relates to a
homestead must contain the following notice conspicuously printed,
stamped, or typed in a size equal to at least 10-point boldface or the
computer equivalent, at the top of the page:

"NOTICE: THIS IS NOT A LIEN. THIS IS ONLY AN AFFIDAVIT CLAIMING A
LIEN."

(g) For the lien on a homestead to be valid, the notice required to be
given to the owner under Section 53.252 must include or have attached the
following statement:

"If a subcontractor or supplier who furnishes materials or performs
labor for construction of improvements on your property is not paid, your
property may be subject to a lien for the unpaid amount if:

(1) after receiving notice of the unpaid claim from the claimant, you
fail to withhold payment to your contractor that is sufficient to cover
the unpaid claim until the dispute is resolved; or

(2) during construction and for 30 days after completion of
construction, you fail to retain 10 percent of the contract price or 10
percent of the value of the work performed by your contractor.

"If you have complied with the law regarding the 10 percent retainage
and you have withheld payment to the contractor sufficient to cover any
written notice of claim and have paid that amount, if any, to the
claimant, any lien claim filed on your property by a subcontractor or
supplier, other than a person who contracted directly with you, will not
be a valid lien on your property. In addition, except for the required 10
percent retainage, you are not liable to a subcontractor or supplier for
any amount paid to your contractor before you received written notice of
the claim."

We apologize for sending you information relating to Texas as it was initially unclear based on your previous question that the property is located in Arizona. Unfortunately, we are unable to provide specific legal advice pertaining to the particular facts of your situation and only offer general legal information regarding the subject matter in the answers we provide such as the information we provided regarding lien laws.

The following are Arizona statutes:

33-981. Lien for labor; professional services or materials used in
construction, alteration or repair of structures; preliminary twenty day
notice; exceptions

A. Except as provided in sections 33-1002 and 33-1003, every person who
labors or furnishes professional services, materials, machinery, fixtures
or tools in the construction, alteration or repair of any building, or
other structure or improvement, shall have a lien on such building,
structure or improvement for the work or labor done or professional
services, materials, machinery, fixtures or tools furnished, whether the
work was done or the articles were furnished at the instance of the owner
of the building, structure or improvement, or his agent.

B. Every contractor, subcontractor, architect, builder or other person
having charge or control of the construction, alteration or repair, either
wholly or in part, of any building, structure or improvement is the agent
of the owner for the purposes of this article, and the owner shall be
liable for the reasonable value of labor or materials furnished to his
agent.

C. A person who is required to be licensed as a contractor but who does
not hold a valid license as such contractor issued pursuant to title 32,
chapter 10 shall not have the lien rights provided for in this section.

D. A person required to give preliminary twenty day notice pursuant to
section 33-992.01 is entitled to enforce the lien rights provided for in
this section only if he has given such notice and has made proof of service
pursuant to section 33-992.02.

E. A person who furnishes professional services but who does not hold a
valid certificate of registration issued pursuant to title 32, chapter 1
shall not have the lien rights provided for in this section.

F. A person who furnishes professional services is entitled to enforce
the lien rights provided for in this section only if such person has an
agreement with the owner of the property or with an architect, an engineer
or a contractor who has an agreement with the owner of the property.

33-998. Limitation of action to foreclose lien; attorney fees

A. A lien granted under the provisions of this article shall not
continue for a longer period than six months after it is recorded, unless
action is brought within that period to enforce the lien and a notice of
pendency of action is recorded pursuant to section 12-1191 in the office of
the county recorder in the county where the property is located. If a lien
claimant is made a party defendant to an action brought by another lien
claimant, the filing within such period of six months of an answer or
cross-claim asserting the lien shall be deemed the commencement of an
action within the meaning of this section.

B. In any action to enforce a lien granted under this article, the court
may award the successful party reasonable attorney fees.

33-1002. Definitions; inapplicability of certain liens to owner-occupied
dwelling; waiver void

A. In this section:

1. "Dwelling" means real property upon which there has been constructed
or is to be constructed any building, structure or improvement which is
designed for either single one-family or single two-family residential
purposes or activities related thereto, including an apartment in a
horizontal property regime or other condominium.

2. "Owner-occupant" means a natural person who:

(a) Prior to commencement of the construction, alteration, repair or
improvement holds legal or equitable title to the dwelling by a deed or
contract for the conveyance of real property recorded with the county
recorder of the county in which the dwelling is located, and

(b) Resides or intends to reside in the dwelling at least thirty days
during the twelve-month period immediately following completion of the
construction, alteration, repair or improvement and does not intend to sell
or lease the dwelling to others. Residence in the dwelling or intent to
reside in the dwelling may be evidenced by the following or other physical
acts:

(i) The placing of his or her personal belongings and furniture in the
dwelling, and

(ii) Occupancy either by the person or members of his or her family. A
single act shall not establish a person as an owner-occupant if such person
permits exclusive occupancy by other than members of his or her family for
other than temporary purposes thereby negating his or her intent to reside
in the dwelling primarily for use as his or her home.

B. No lien provided for in this article shall be allowed or recorded by
the person claiming a lien against the dwelling of a person who became an
owner-occupant prior to the construction, alteration, repair or
improvement, except by a person having executed in writing a contract
directly with the owner-occupant.

C. Any provision of an agreement made or entered into by an
owner-occupant which waives the provisions of this section is void.

33-1004. Discharge of mechanic's liens; bond; limitations of actions;
discharge of surety; judgment

A. After perfection of a lien pursuant to this article, an owner,
including any person who has a legal or equitable interest in the land
which is subject to the lien, a contractor, subcontractor, mortgagee or
other lien creditor, may, either before or after the commencement of an
action to foreclose such lien, cause to be recorded in the office of the
county recorder, in the county in which the land is located, a surety bond
in the form described in subsection B of this section, together with a
power of attorney disclosing the authority of the person executing the same
on behalf of the surety. Upon the recordation of such bond, the property
shall be discharged of such lien whether or not a copy of the bond is
served upon the claimant or he perfects his rights against the bond.

B. A surety bond to discharge a lien perfected under this section shall
be executed by the person seeking to discharge such lien, as principal, and
by a surety company or companies holding a certificate of authority to
transact surety business in this state, issued by the director of the
department of insurance pursuant to title 20, chapter 2, article 1. The
bond shall be for the sole protection of the claimant who perfected such
lien. Notwithstanding any other statute, the surety bond shall not be
executed by individual surety or sureties, even if the requirements of
section 7-101 are satisfied. The bond shall be in an amount equal to one
hundred fifty per cent of the demand set forth in and secured by the notice
and claim of lien and shall be conditioned for the payment of the judgment
which would have been rendered against the property for the enforcement of
the lien. The legal description of the property and the docket and page of
the lien sought to be discharged shall be set forth in the bond.

C. The principal on such bond, upon recordation thereof with the county
recorder, shall cause a copy of the bond to be served within a reasonable
time upon the lien claimant, and if a suit is then pending to foreclose the
lien the claimant, within ninety days after receipt thereof shall cause
proceedings to be instituted to add the surety and the principal as parties
to the lien foreclosure suit. In addition, on recording and service of the
surety bond, any monies withheld in response to a stop notice or bonded
stop notice that is served by the lien claimant pursuant to article 9 of
this chapter with respect to the same labor and material described in the
notice and claim of lien shall be released promptly.

D. The bond shall be discharged and the principal and sureties released
upon any of the following:

1. The failure of the lien claimant to commence a suit within the time
allowed pursuant to section 33-998.

2. Failure of the lien claimant to name the principal and sureties as
parties to the action seeking foreclosure of the lien if a copy of the bond
has been served upon claimant. If the bond is served upon the claimant
within less than ninety days from the date claimant would be required to
commence his action pursuant to section 33-998, the claimant shall have
ninety days from the date he receives a copy of such bond to add the
principal and the sureties as parties to the lien foreclosure suit.

3. The dismissal of the foreclosure suit with prejudice as to the
claimant or the entry of judgment in such suit against claimant.

E. In an action to foreclose a lien under this article, where a bond has
been filed and served as provided herein, a judgment for the claimant on
the bond shall be against the principal and his sureties for the reasonable
value of the labor and material furnished and shall not be against the
property. A judgment for the claimant on the bond, including any recovery
for interest, expenses, costs and attorney fees awarded by the court, shall
not exceed the penal sum of the bond. If the amount the claimant recovers
exceeds the penal sum of the bond, the claimant shall also be entitled to
judgment against the principal for the excess amount.

F. In the event a copy of the bond is not served upon the claimant as
provided in subsection C of this section, the claimant shall have six
months after the discovery of such bond to commence an action thereon,
except that no action may be commenced on such bond after two years from
the date it was recorded as provided in this section.

G. The county recorder of the county in which the bond and contract are
recorded shall index the bond and contract under the index classification
in which mechanics' and materialmen's liens are recorded.

33-1006. Release of mechanic's and materialman's liens; liability

A. When any lien established by the provisions of this article has been
satisfied, the lienholder shall, within twenty days after satisfaction,
issue a release of the lien.

B. When any lien prohibited to be filed against the dwelling of an
owner-occupant as defined in section 33-1002 has been recorded, the person
claiming the lien shall, within twenty days of the written request of the
owner-occupant, issue a release of the lien.

C. The release issued pursuant to this section shall be in document form
as specified in section 11-480. Failure to grant such a release shall
subject the lienholder or person to liability in the amount of one thousand
dollars and also to liability for actual damages.

Please see Title 33, Chapter 7, Article 6 of the Arizona statutes for more information at the following link:

http://www.azleg.state.az.us/ArizonaRevisedStatutes.asp?Title=33

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