• Consumers
• Legal Issues
• Understanding Mechanic's Liens
• Preventing

How to prevent a mechanic's liens?

This section describes a number of steps that can be taken to prevent mechanic's liens.

Carefully choose your contractor.

• Hire only licensed contractors and check the contractor's license status on CSLB's website;
• Make sure your contractor hires only licensed subcontractors, and check their licenses, too;
• Check up on your prime contractors reputation for payment and lawsuits at the local courthouse, suppliers, and subcontractors;
• Get a list of all subcontractors, laborers, and materials suppliers to be used by your prime contractor.

Make sure your written contract includes the following in detail:

• A payment schedule that states when specific aspects of the work start and end and the price for each segment;
• Identification of subcontractors for each segment;
• Identification of suppliers who are providing materials.

Keeping track of the paperwork.

Preliminary 20-Day Notice
A Preliminary 20-Day Notice is required from the subcontractor or supplier if there is a chance that they may need to file a lien. The Notice states that the subcontractor or supplier has provided or will be providing goods and services to improve your property and could file a lien claim if they are not paid. If subcontractors and suppliers don't provide you with the notice, they lose the right to file a lien.

(NOTE: This Notice is not required from laborers or your prime contractor.)

TIP Save the notices, so you can keep track of who is owed money and when they are paid. Sometimes a subcontractor or supplier will give you the Preliminary Notice before delivering supplies or starting work and up to 20 days after delivering supplies or starting work.

Joint Checks

The simplest way to prevent liens is to pay with joint checks.

• Compare the contractor's bill for materials or labor, compare it to the schedule of payments in your contract and the Preliminary 20-Day Notices
• Make sure that work was done as described
• Make out the check to both the contractor and the supplier, or subcontractor.
• Both parties will have to endorse the check, which will ensure that the subcontractors and suppliers get paid.

Lien Releases

The release system is designed to allow property owners to track when potential lien claimants have been paid.

Before making a payment, get a signed conditional release from the possible lien claimants.

Get information on lien releases from the Conditional and Unconditional Waiver and Release Forms section of this website. Either you or your contractor can download a copy of the release. The prime contractor is required to get this release for you from the potential lien claimants, if you ask for it.

After you pay, the contractor should get you an unconditional release signed by each of the claimants paid for the portion of the work being released. Make sure that the actual claimant signs the unconditional release.

By law, you may withhold the next payment until you get the unconditional releases for the previous payment.

Notice of Completion

By filing a Notice of Completion with the County Recorder's office after work is completed, you can reduce the amount of time a contractor, subcontractor or supplier has to record a claim.

This Notice reduces the amount of time a contractor has to record a mechanic's lien from 90 to 60 days, and reduces the time a subcontractor or materials supplier has to record a mechanic's lien from 90 days to 30 days.

The Notice of Completion form may be obtained through your County Recorder's office or a stationary or office supply store that stock legal forms.