Liens and other remedies

California's mechanics lien law is in Civil Code §§8000–9566. It protects people who improve property, but only if they follow each step on time. Miss one deadline and the right is usually gone.

Key words

• Work of improvement: the whole construction project, including building, alteration, repair, demolition, grading, and landscaping (Civil Code §8050).
• Direct contractor: a contractor with a contract directly with the owner. Laws that say “prime contractor” mean the same thing (Civil Code §8018).
• Laborer: a person who works on the project as an employee (Civil Code §8024).

Who can record a mechanics lien

A mechanics lien (gravamen de constructor) is a claim against the real property that was improved. Anyone who provides authorized work has lien rights, including a direct contractor, subcontractor, material supplier, equipment lessor, laborer, and design professional (Civil Code §8400). Work is authorized if the owner requested or agreed to it, or if a contractor, sub, architect, project manager, or other person in charge of the work authorized it (Civil Code §8404).

The lien is for the lesser of the reasonable value of the work or the agreed price (Civil Code §8430). An unlicensed contractor cannot sue to collect for work that requires a license, and a security interest it takes for that payment is unenforceable (B&P §7031). On public works, there is no mechanics lien remedy in the statute; unpaid claimants use a stop payment notice or a payment bond claim instead (Civil Code §9100).

Step 1: The 20-day preliminary notice

A preliminary notice (notificación preliminar) tells the owner, the direct contractor, and any construction lender that you are working on the project and could claim a lien if not paid. It is a required step before recording a lien, giving a stop payment notice, or making a payment bond claim (Civil Code §8200). It is not a lien.

• Deadline: no later than 20 days after the claimant first furnishes work (Civil Code §8204).
• Late notice is still allowed, but rights cover only work performed within 20 days before the notice was served, and after.
• Laborers do not have to give preliminary notice. A direct contractor gives it only to the construction lender, if there is one.
• Give it by personal delivery, or by registered, certified, or express mail, or overnight delivery by an express carrier (Civil Code §§8106, 8110).
• It must include a work description, a price estimate, and the boldface “NOTICE TO PROPERTY OWNER” statement (Civil Code §8202).
• A licensed subcontractor with a contract over $400 who fails to give the notice can be disciplined by CSLB (Civil Code §8216).

Step 2: Completion, notice of completion, and notice of cessation

Lien deadlines count from “completion.” Under Civil Code §8180, completion happens at the first of: actual completion; the owner occupying or using the project plus a stop in labor; labor stopping for 60 days in a row; or recording a notice of cessation after labor has stopped for 30 days in a row. On a public entity project, completion is acceptance by the entity.

The owner may record a notice of completion (notificación de finalización) with the county recorder on or within 15 days after completion; it must be signed and verified (Civil Code §8182). The owner may record a notice of cessation after labor has stopped for at least 30 days in a row (Civil Code §8188). Recording either notice shortens the time to record liens. The owner must send a copy to the direct contractor and everyone who gave preliminary notice within 10 days of recording. If the owner does not, the shorter deadline does not apply to that person. A homeowner living in a dwelling with four or fewer units is exempt from sending copies (Civil Code §8190).

Step 3: Record the claim of lien on time