What to do if a lien was improperly placed on your property?
Full Question:
Answer:
The following is suggested by the Californai State Contractor's License Board:
Send the lien claimant a written request by certified mail. Keep a copy of your letter and the certification as proof of your request. Include:
* Deviations you've identified from the statutory lien requirements.
* A request for the claimant to remove the lien.
* Remind the claimant that, if the lien is not removed and you have to get an attorney to remove it, the court can award you attorney fees of up to $2,000.
Send the request to the claimant's last known verified address. In some cases, a letter alone may avoid litigation. Keep all your documents and paperwork. You may need to demonstrate to a court that the lien claimant is unable or unwilling to execute a release of the lien or cannot, with reasonable diligence, be found.
If the lien claimant doesn't remove the invalid lien, and the time has expired to record the mechanic's lien and take action to foreclose, you may petition the court for a decree to release the property from the lien.
The following are California statutes:
3143.
If the owner of property, or the owner of any interest therein, sought to be charged with a claim of lien, or any original contractor or subcontractor disputes the correctness or validity of any claim of lien, he may record in the office of the county recorder in which such claim of lien was recorded, either before or after the commencement of an action to enforce such claim of lien, a bond executed by a corporation authorized to issue surety bonds in the State of California, in a penal sum equal to 11/2 times the amount of the claim or 11/2 times the amount allocated in the claim of lien to the parcel or parcels of real property sought to be released, which bond shall be conditioned for the payment of any sum which the claimant may recover on the claim together with his cost of suit in the action, if he recovers therein. Upon the recording of such bond the real property described in such bond is released from the lien and from any action brought to foreclose such lien. The principal upon such bond may be either the owner of the property or the owner of any interest therein, or any original contractor, subcontractor, or sub-subcontractor affected by such claim of lien.
3144.
(a) No lien provided for in this chapter binds any property for a longer period of time than 90 days after the recording of the claim of lien, unless within that time an action to foreclose the lien is commenced in a proper court, except that, if credit is given and notice of the fact and terms of such credit is recorded in the office of the county recorder subsequent to the recording of such claim of lien and prior to the expiration of such 90-day period, then such lien continues in force until 90 days after the expiration of such credit, but in no case longer than one year from the time of completion of the work of improvement.
(b) If the claimant fails to commence an action to foreclose the lien within the time limitation provided in this section, the lien automatically shall be null and void and of no further force and effect.
3144.5.
Any person who obtains a lien release bond which is recorded pursuant to Section 3143 shall give notice of the recording to the lienholder by mailing a copy of the bond to the lienholder at the address appearing on the lien. Service of the notice shall be by certified or registered mail, return receipt requested. Failure to give the notice provided by this section shall not affect the validity of the lien release bond, but the statute of limitations on any action on the bond shall be tolled until the notice is given. Any action on the lien release bond shall be commenced by the claimant within six months of the recording of the lien release bond.
3145.
As against any purchaser or encumbrancer for value and in good faith whose rights are acquired subsequent to the expiration of the 90-day period following the recording of the claim of lien, no giving of credit or extension of the lien or of the time to enforce the same shall be effective unless evidenced by a notice or agreement recorded in the office of the county recorder prior to the acquisition of the rights of such purchaser or encumbrancer.
3146.
After the filing of the complaint in the proper court, the plaintiff may record in the office of the county recorder of the county, or of the several counties in which the property is situated, a notice of the pendency of such proceedings, as provided in Section 409 of the Code of Civil Procedure. Only from the time of recording such notice shall a purchaser or encumbrancer of the property affected thereby be deemed to have constructive notice of the pendency of the action, and in that event only if its pendency against parties designated by their real names.
3147.
If the action to foreclose the lien is not brought to trial within two years after the commencement thereof, the court may in its discretion dismiss the same for want of prosecution.
3148.
In all cases the dismissal of an action to foreclose the lien (unless it is expressly stated that the same is without prejudice) or a judgment rendered therein that no lien exists shall be equivalent to the cancellation and removal from the record of such lien.
3149.
Any number of persons claiming liens on the same property may join in the same action to foreclose their liens and when separate actions are commenced the court may consolidate them.
3150.
In addition to any other costs allowed by law, the court in an action to foreclose a lien must also allow as costs the money paid for verifying and recording the lien, such costs to be allowed each claimant whose lien is established, whether he be plaintiff or defendant.
3151.
Whenever on the sale of the property subject to any liens provided for in this chapter, under a judgment of foreclosure of such lien, there is a deficiency of proceeds, judgment for the deficiency may be entered against any party personally liable therefor in like manner and with like effect as in an action for the foreclosure of a mortgage.
3152.
Nothing contained in this title affects the right of a claimant to maintain a personal action to recover a debt against the person liable therefor either in a separate action or in the action to foreclose the lien, nor any right the claimant may have to the issuance of a writ of attachment or execution or to enforce a judgment by other means. In an application for a writ of attachment, the claimant shall refer to this section. A lien held by the claimant under this chapter does not affect the right to procure a writ of attachment. The judgment, if any, obtained by the claimant in a personal action, or personal judgment obtained in a mechanic's lien action, does not impair or merge a lien held by the claimant under this chapter, but any money collected on the judgment shall be credited on the amount of the lien.
3153.
In all cases where a claim of lien is recorded for labor, services, equipment, or materials furnished to any contractor, he shall defend any action brought thereon at his own expense, and during the pendency of such action the owner may withhold from the original contractor the amount of money for which the claim of lien is recorded. In case of judgment in such action against the owner or his property upon the lien, the owner shall be entitled to deduct from any amount then or thereafter due from him to the original contractor the amount of such judgment and costs. If the amount of such judgment and costs exceeds the amount due from him to the original contractor, or if he has settled with the original contractor in full, he shall be entitled to recover back from the original contractor, or the sureties on any bond given by him for the faithful performance of his contract, any amount of such judgment and costs in excess of the contract price, and for which the original contractor was originally the party liable.
3154.
(a) At any time after the expiration of the time period specified by Section 3144 with regard to the period during which property is bound by a lien after recordation of a claim of lien, where no action has been brought to enforce that lien, the owner of the property or the owner of any interest therein may petition the proper court for a decree to release the property from the lien.
(b) The petition shall be verified and shall allege all of the following:
(1) The date of recordation of the claim of lien.
(2) The legal description of the property affected by the claim of lien.
(3) That no action to foreclose the lien is pending, or that no extension of credit has been recorded, and that the time period during which suit can be brought to foreclose the lien has expired.
(4) That the lien claimant is unable or unwilling to execute a release of the lien or cannot with reasonable diligence be found.
(5) That the owner of the property or interest in the property has not filed for relief under any law governing bankruptcy, and that there exists no other restraint to prevent the lien claimant from filing to foreclose the lien. A certified copy of the claim of lien shall be attached to the petition. The petition shall be deemed controverted by the lien claimant.
(c) Upon the filing of the petition, and before any further proceedings are had, the clerk shall set a date for the hearing not more than 30 days following the filing of the petition. The court may continue the hearing beyond the 30-day period, but good cause shall be shown for any continuance.
(d) A copy of the petition and the notice setting the date for the hearing shall be served upon the lien claimant at least 10 days prior to the date set for hearing, in the manner in which a summons is required to be served, or by certified or registered mail, postage prepaid, return receipt requested, addressed to the lien claimant at the claimant's address as shown in any of the following:
(1) The preliminary 20-day notice served by the claimant pursuant to Section 3097.
(2) The records of the registrar of contractors.
(3) The contract on which the lien is based.
(4) The claim of lien itself.
(e) When service is made by mail as provided in this section, service is complete on the fifth day following the day of the deposit of the mail. No decree shall issue in favor of the petitioner unless the petitioner proves that service of the petition and the order fixing the date for hearing was made in compliance with this subdivision. The issue of compliance with this subdivision shall be deemed controverted by the lien claimant.
(f) In the event judgment is rendered in favor of the petitioner, the decree shall indicate all of the following:
(1) The date the lien was recorded.
(2) The county and city, if any, in which the lien was recorded.
(3) The book and page of the place in the official records where the lien is recorded.
(4) The legal description of the property affected. Upon the recordation of a certified copy of the decree, the property described in the decree shall be released from the lien.
g) The prevailing party shall be entitled to attorneys' fees not to exceed two thousand dollars ($2,000).
(h) Nothing in this section shall be construed to bar any other cause of action or claim for relief by the owner of the property or an interest in the property, nor shall a decree canceling a claimant' s lien bar the lien claimant from bringing any other cause of action or claim for relief, other than an action foreclosing the lien. However, no other action or claim shall be joined with the claim for relief established by this section.
(i) Chapter 2.5 (commencing with Section 1141.10) of Title 3 of Part 3 of the Code of Civil Procedure does not apply to causes commenced pursuant to this section.
