How the Mechanics Lien Now Applies to Design Professionals

How the Mechanics Lien Now Applies to Design Professionals

There was recently a big change for designers: The design professional lien law was repealed effective July 1, 2012 and replaced by new payment remedy laws to create updated and favorable lien laws for design professionals. If you’re interested in looking it up, you’ll find it in Civil Code sections 8000, et seq., (more specifically, Civil Code sections 8300, et seq). Here’s a summary of the basic changes:

  • There is no longer a “design professional lien.”
  • As under the previous law, design professionals can record a mechanic’s lien. The change is that now the designer can record the lien before actual construction begins.
  • The requirements for filing a mechanic’s lien are the same as before; the design professional needs to be in contract with the owner, and a building permit or other governmental approval of the work of improvement needs to have been obtained.
  • This new law maintains the same notice and recording requirements as well:
    • Before recording a lien, the design professional needs to give at least 10 days written notice to the property owner stating that a default has occurred under the design contract, indicate the amount of the default, and make a demand for payment.
    • When recording a lien, the lien needs to include the name of the design professional, the amount of the claim, the name of the current owner of record, a legal description of the property, and must identify the building permit or other governmental approval for the planned work of improvement.
  • There are two ways for a mechanic’s lien recorded by a design professional to expire and become null and void:
    • The commencement of the work of improvement.
    • The expiration of 90 days after recording the mechanic’s lien, unless the design professional begins an action to foreclose on the lien.
  • A new addition to the law is that a design professional may convert a mechanic’s lien recorded pre-construction into what is essentially a regular mechanic’s lien within 30 days of beginning the work of improvement. To convert a pre-construction mechanic’s lien, the design professional needs to re-record the lien, which must indicate that it is a converted pre-construction lien. For the conversion, no preliminary lien notice is required.

It is important to understand exactly what new guidelines you need to follow as a design professional to make important legal claims. Omni Law Group is here to help. For more information about these new lien laws and for legal assistance, contact us today!

Photo Credit: Will Scullin

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