Mechanic’s Lien–Amending After Nonpayment
We are all familiar with the primary process of recording a mechanics lien after nonpayment of construction services. You go to the time and effort of recording same, negotiate with either the owner or the general contractor, and hopefully come to some kind of good faith settlement. In almost all cases, this is a substantial reduction in the overall amount due.
But you basically take it as a cost of doing business and accept the reduction. But the other side requests that you record a release of mechanic’s lien first and in an ultimate measure of good faith, you release the lien. But then you wait for payment.
Nothing happens. Demand after demand is made, but still the payment is not made. Adding insult to injury, you have detrimentally relied in releasing the mechanics lien and have taken much less than should have been paid in the first place.
But it’s too late to re-record a mechanic’s lien. What can you do?
The best idea is to get legal advice or can call National Lien Law. But there is a possible alternative. You could claim the release of the mechanic’s lien is of no force and effect because it was done under false pretenses and fraudulently because of the misrepresentation of payment. You might be able to record an amended mechanics lien.
You would write a demand letter to the other side indicating that if payment is not made by cashier’s check within 10 days of receipt of the letter, for the amount of the original settlement, you will then bring a lawsuit to foreclose and ask for the entire amount owed. Hopefully that will jar them loose.