Contractors, materialmen, and suppliers should be mindful that California law requires that a “Notice of Lis Pendens” be recorded by the claimant within 20 days after the filing of a mechanics lien foreclosure action. Failure of a claimant to record a lis pendens pursuant may result in additional defenses available to subsequent purchasers or encumbrancers. Unsophisticated contractors, materialmen, and suppliers could fall into the trap of not following the proper procedures which could lead to delays in payment and possible non-payment.
In California a lien claimant must prepare and record a “Notice of Lis Pendens” within 20 days after the filing of a mechanics lien foreclosure action. This is not the standard practice for a lot of contractors, materialmen, and suppliers.
Failure of a claimant to record a lis pendens pursuant to this law may result in additional defenses available to subsequent purchasers or encumbrancers and provide numerous hurdles for claimants.
This is another procedure for contractors, materialmen, suppliers and property owners to understand. Although it is a common practice for attorneys to record a lis pendens simultaneously with a summons and complaint, many contractors, materialmen, and suppliers simply neglect it as most don’t understand the ramifications and importance of a lis pendens.
Many contractors, materialmen, and suppliers who are not savvy or do not have the administrative resources that larger companies have are likely to run afoul of this requirement. The consequence of failing to file a lis pendens will result in possible loss of priority and possible non-payment of the recorded lien. This once again illustrates the importance of hiring competent counsel when protecting your interests.
For relevant portions of the statutory scheme see California Civil Code section 3146.
The Bottom Line
Make sure if you are a contractor, materialmen, or supplier and have a valid claim of lien against a piece of real property that you timely prepare and serve a 20-day preliminary lien notice, that you timely record your mechanic’s lien if appears that your compensation or payment is not forthcoming, that you timely record a Mechanic’s Lien Notice, that you timely file a summons and complaint, and timely record a Notice of Lis Pendens. For help with any of the above contact a competent licensed attorney in your area familiar with these procedures.
David S. Roberson, Esq. is an associate at the law firm of Rossi, Hamerslough, Reischl & Chuck, 1960 The Alameda, Suite 200, San Jose, CA 95126, http://www.rhrc.net, daver@rhrc.net, 408-261-4252.
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