You did your part on a construction project, but the bill
has not been paid. You want to file a lien on the property to make sure you get
what is due. But who exactly can file a lien?
This is where the Michigan Construction Lien Act comes
in. This piece of legislation helps construction companies file a lien and
receive the payments due to them according to the law.
The Act is very specific as to who is allowed to file a
lien. Ultimately, the law is broad enough that a variety of people and
companies working on a job site are eligible to file a lien if they have not
been paid according to their contract with the property owner.
Each and every contractor, subcontractor, supplier or laborer
who provides an improvement to real property may seek out a lien on that
project.
The definitions of these jobs are fairly broad as well. A
contractor is considered any person who provides an improvement to a real
property – as long as there is a contract in place with the owner or lessee of
that same property. The contractor typically is anyone who has direct contract
with the property’s owner.
A subcontractor means a person who has a contract between
themselves and the main contractor to provide any part of an improvement to the
property. The subcontractor would not have a contract between themselves and
the owner or lessee. This person has no direct contract with the owner.
A supplier is someone who provides materials for a
project. A supplier does not provide any labor on a project. And a supplier
does not have a direct contract with the property’s owner.
A laborer refers to a person who provides an improvement
to a real property through his or her personal work. This, too, requires a
contract to be in place for this person to have legal rights in terms of filing
a lien on a project.
A key part of these definitions is that there needs to be
a contract between the property owner or lessee and the person or company doing
the improvements. Having this document protects everyone, especially the
construction company doing the work.
Who does not qualify? The Act does not cover those
companies that are providing services such as surveying, engineering,
construction management, architectural planning, clearing, demolishing,
excavating, filling or adding fixtures or material. And, in those rare cases
where this happens, suppliers of suppliers also do not qualify as being able to
file a lien.
A contract outlines in legal form what improvements the
owner or lessee wants completed on the project. This contract must be in
writing for residential projects; don’t leave it as a conversation or scribbles
on a napkin. Your friend or business associate may feel like that’s enough, but
the law does not. What’s a residential project? The law defines a residential
project as one with no more than two residential units. This also includes
additional structures, like a parking garage.Get it in writing, and make it
binding. This is your business you’re protecting.
You provide real work; you deserve to be paid the value
of that work. Having a contract as well as the ability to put a lien in place
is protected under this law. It reduces the risks of running a construction
business, and it maintains your ability to do the work you love for years to
come.
If you want to make use of the Michigan Construction Lien
Act, contact the experienced attorneys at The Lien Company to file the appropriate
lien and related papers. Placing a lien improperly or untimely can cost you
thousands of dollars. We will make it
easy to put a lien in motion and follow through on it to make sure you are paid
for the work you have done.
www.LienCompany.com
www.LienCompany.com
