Enforcement Of Lien - Mechanics Lien - CA Civil Law

Section § 8460

This law outlines the timeframe in which someone must take legal action to enforce a lien after it's been recorded. Generally, you have 90 days to start this process. If you miss this deadline, the lien becomes invalid unless there's an agreement with the property owner to delay the payment. This agreement must also be recorded and the enforcement action must start within a specific, extended time, but no more than a year after the project is done. Missing this extended deadline also makes the lien unenforceable.

(a) The claimant shall commence an action to enforce a lien within 90 days after recordation of the claim of lien. If the claimant does not commence an action to enforce the lien within that time, the claim of lien expires and is unenforceable.

(b) Subdivision (a) does not apply if the claimant and owner agree to extend credit, and notice of the fact and terms of the extension of credit is recorded (1) within 90 days after recordation of the claim of lien or (2) more than 90 days after recordation of the claim of lien but before a purchaser or encumbrancer for value and in good faith acquires rights in the property. In that event the claimant shall commence an action to enforce the lien within 90 days after the expiration of the credit, but in no case later than one year after completion of the work of improvement. If the claimant does not commence an action to enforce the lien within that time, the claim of lien expires and is unenforceable.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Section § 8461

When someone files a lawsuit to enforce a lien on a property, they must file a notice called a 'notice of pendency' with the county recorder's office where the property is located, within 20 days. This notice lets anyone interested in buying or lending money on the property know about the pending legal action. This notice only informs them about the lawsuit against people identified by their actual names in the notice.

After commencement of an action to enforce a lien, the plaintiff shall 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 the action, as provided in Title 4.5 (commencing with Section 405) of Part 2 of the Code of Civil Procedure, on or before 20 days after the commencement of the action. Only from the time of recording that 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 of its pendency against parties designated by their real names.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Section § 8462

If you start a legal case to enforce a lien and it hasn't gone to trial within two years, the court can choose to dismiss it because of a lack of progress.

Notwithstanding Section 583.420 of the Code of Civil Procedure, if an action to enforce a lien is not brought to trial within two years after commencement of the action, the court may in its discretion dismiss the action for want of prosecution.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Section § 8464

If you're taking legal action to enforce a lien and successfully prove your claim, the court will let you recover the costs you spent to officially file and verify your lien, regardless of whether you're the one suing or just defending yourself in the case.

In addition to any other costs allowed by law, the court in an action to enforce a lien shall allow as costs to each claimant whose lien is established the amount paid to verify and record the claim of lien, whether the claimant is a plaintiff or defendant.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Section § 8466

If a property sale doesn't bring in enough money to cover the debt from a lien, the court can order the person who owes the money to pay the remaining amount, just like with a mortgage foreclosure.

If there is a deficiency of proceeds from the sale of property on a judgment for enforcement of a lien, a deficiency judgment may be entered against a party personally liable for the deficiency in the same manner and with the same effect as in an action to foreclose a mortgage.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Section § 8468

This law clarifies that even when someone files a claim to secure payment of a debt, it doesn't take away certain rights of the person claiming the debt. First, they can still file a lawsuit directly against the person who owes them money, either separately or as part of a lien process. Second, they can seek a court order to seize the debtor's assets before the judgment is decided, called a writ of attachment. Third, they still have the right to enforce a court's decision (judgment) to collect the debt. Additionally, if they do get a court judgment, it doesn't erase their claim to a lien, but any money collected through the judgment reduces the amount owed on the lien.

(a) This chapter does not affect any of the following rights of a claimant:

(1) The right to maintain a personal action to recover a debt against the person liable, either in a separate action or in an action to enforce a lien.

(2) The right to a writ of attachment. In an application for a writ of attachment, the claimant shall refer to this section. The claimant’s recording of a claim of lien does not affect the right to a writ of attachment.

(3) The right to enforce a judgment.

(b) A judgment obtained by the claimant in a personal action described in subdivision (a) does not impair or merge the claim of lien, but any amount collected on the judgment shall be credited on the amount of the lien.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Section § 8470

This law deals with what happens when a lien is filed because a contractor hasn't paid for work. The contractor has to handle the lawsuit themselves and can't make the property owner pay for their defense. While the lawsuit is ongoing, the owner can hold back the amount of the lien from the contractor. If the court sides with the lien claimant and the owner has to pay, the owner can deduct that amount from what they owe the contractor. If there's more money owed than what was deducted, the owner can get the rest of the money back from the contractor or their insurance.

In an action to enforce a lien for work provided to a contractor:

(a) The contractor shall defend the action at the contractor’s own expense. During the pendency of the action the owner may withhold from the direct contractor the amount of the lien claim.

(b) If the judgment in the action is against the owner or the owner’s property, the owner may deduct the amount of the judgment and costs from any amount owed to the direct contractor. If the amount of the judgment and costs exceeds the amount owed to the direct contractor, or if the owner has settled with the direct contractor in full, the owner may recover from the direct contractor, or the sureties on a bond given by the direct contractor for faithful performance of the direct contract, the amount of the judgment and costs that exceed the contract price and for which the direct contractor was originally liable.

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(Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)