Insurance & LiensQuestion 477 of 1605
A subcontractor served a proper preliminary notice but the owner never paid. Before recording a mechanics' lien, the subcontractor should make sure the lien claim states an amount that is:
a.Double the contract price, to account for interest
b.The full original contract price even though most was paid
c.No more than the reasonable value of the labor or materials actually furnished and unpaid
d.Equal to the property's market value
Explanation
A mechanics' lien may only secure the reasonable value of the work, services, equipment, or materials actually furnished and not yet paid for. Willfully overstating the lien amount can render the entire lien unenforceable.
Law Reference: Civil Code §8410Practice all 1605 questions free — no signup required.
Related questions on this topic
- A design-build contractor makes a professional design error that causes a client financial loss but no bodily injury or property damage. Which coverage is specifically intended for this kind of claim?
- Which of the following parties is generally NOT entitled to record a mechanics' lien on a private construction project?
- On a private project where NO Notice of Completion or Cessation is recorded, what deadline applies to ALL claimants for recording a mechanics' lien?
- On a private project, an owner who wants to shorten the time claimants have to record liens should:
- A contractor recorded a valid mechanics' lien but, 100 days later, has neither been paid nor filed a foreclosure lawsuit. What is the status of the lien?
- A subcontractor signs a lien waiver in exchange for a progress payment that has not yet actually cleared. Which type of waiver is appropriate so the waiver only takes effect once payment is received?
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)