Determining Validity Of Contractor Claim Of Lien

Understanding engagement relationships and responsibilities regarding subcontractors is crucial for construction company owners. A recent decision ruled that a lien was valid, even though the property owners were unaware of the subcontractor's existence. The Court highlighted the concept of "engagement" and stated that subcontractors can register a lien if the owner requested or was aware of the work being done. The burden of payment for work done rests with the property owner. Parties to construction contracts should be sure to accurately name all parties in contracts and seek legal advice to understand lien eligibility and obligations.

Registering a lien can appear straightforward. Typically, it involves completing simple template forms. But if the identities of certain parties in the contract chain are unknown or in flux, it can cause problems.