Issues with construction projects often lead to disputes in civil court. Construction litigation frequently begins due to a client’s frustrations or their non-payment.
Clients can take legal action over contract breaches and defects by filing lawsuits against those who worked on their property. Construction businesses and professionals may initiate legal action to demand payment for the services or materials they provided.
Occasionally, outside parties are the reason for construction litigation. Many construction companies hire independent contractors or other self-employed professionals to perform certain construction tasks. Those outside parties could create legal complications if they request a mechanic’s lien to secure their right to payment.
Is a direct arrangement necessary for a lien?
People often misunderstand the rules governing mechanic’s liens. One common misconception is that only the party that signed a contract with the homeowner has the option of pursuing a mechanic’s lien. However, any party that they hire to perform work or provide materials could potentially seek one.
If the construction company does not pay the subcontractor or outside professional, possibly due to complaints about their job performance, a lien request could follow. Such situations are likely to cause conflict, as homeowners may feel frustrated about a lien request when they have paid a construction professional or firm in full.
Appropriate contract inclusions and proactive communication can diminish the likelihood of an outside professional pursuing a mechanic’s lien. Being ready to respond to construction litigation is critical for those working in the construction sector, where a lawsuit can disrupt operations and cause significant reputation damage. Having experienced legal guidance can help.