Mechanic’s Liens are a contractor’s means of leveraging payment from the person contracting for the work of improvement. However, what happens when a Contractor is hired by the Home Owners Association and not the individual unit owners? What property can the contractor file a mechanic’s lien against? While there is some dispute the
Civil Code §4615 provides:
“(a) In a common interest development, no labor performed or services or materials furnished with the consent of, or at the request of, an owner in the common interest development or the owners’ agent or contractor shall be the basis for the filing of a lien against any other property of another owner in the common interest development unless that other owner has expressly consented to or requested the performance of the labor or furnishing of the materials or services. However, express consent is deemed to have been given by the owner of any separate interest in the case of emergency repairs thereto.
(b) Labor performed or services or materials furnished for the common area, if duly authorized by the association, are deemed to be performed or furnished with the express consent of each separate interest owner.
The preeminent treatise on real property 9 Cal. Real Est. § 32:45 (4th ed.) Miller and Starr California Real Estate 4th November 2020 Update states:
“‘The claimant who constructs improvements in the common area of a common interest development pursuant to a request from the homeowners association may impose a mechanics lien on the entire project, including each of the units and the common area benefited by the work.’
Thus, if you are a General Contractor doing work on a condominium association via a contract with the Home Owners Association you should consider filing your lien against both the common area and the individual units in order to ensure payment. Note however, that you must apportion the lien if it is a lump sum and allow each unit owner to either bond around that apportionment or pay off the apportionment and release the lien. This could lead to a lot of legal work and cost if the project is many units because many homeowners may chose to unencumbered their unit to sell it or refinance it.