Does mechanic's lien supersede other lienholder?

Answer 1

I am an Ohio lawyer, so my answer is from the perspective of Ohio laws, however, many states have laws similar to Ohio's laws.

Generally speaking, mechanic's liens are in existence prior to the date that they are filed. In Ohio, the filing of the lien is essentially claiming the existing lien and the service of the lien on the owner after the filing is merely the perfection of the claimed lien.

The actual priority of the mechanic's lien in Ohio has 3 different possible times of priority. Ohio, as do many states, has a requirement that the project owner file a document, here called a Notice of Commencement, prior to the beginning of any work on the project. Some project owners don't file them at all and others file them late. the NOC has several functions, one of which is the setting of priority of Mechanic's Liens. If no NOC is filed, the priority of the Mechanic's Lien dates to the first visible work on the project. There is a recent Court of Appeals case here that used the delivery of rental, high lift equipment as the first visible work. That equipment was delivered prior to the date that the property was sold to the person doing the improvement, meaning that the first visible work was prior to the date of the filing of the purchase money mortgage. ALL mechanic's liens came before the mortgage because it is not the date of YOUR first visible work, but THE first visible work (there would have been a different result if the mortgage was a construction loan rather than a purchase money loan). The third possibility is that the NOC is filed late. All work performed prior to the filing of the NOC will have a priority date of the first visible work. All work after the filing of the NOC. Those lien claimants that have performed labor and/or supplied materials both before and after the date of the filing of the NOC will only have to file and serve one lien to preserve their lien rights, but the lien will have 2 different dates of priority.

Most other liens tend to have the date of priority of the date and time of the actual filing. (Ohio revised its priority law for mechanic's liens v. mortgages in April, 2007 to provide if the Mechanic's Lien and Mortgage were filed on the same day, the Mortgage will be deemed to have been filed first, unless the documents themselves provide the contrary). Similar to the mechanic's lien, UCC-1s can be filed up to 10 days after the date of the transaction giving rise to the security interest, and still have the perfection of the lien relate back to the original transaction, despite any other intervening liens.

There is also the issue of the expiration or renewal of a lien. The multitude of liens have very different lengths of time that they will either last or last, subject to renewal. In Ohio, mechanic's liens last for 6 years from the date that they were filed. They will expire. Other liens can be renewed and, if renewed prior to the expiration of the underlying lien. To move up in priority, sometimes junior lien holders just wait for another lien which may have a higher priority to expire.

I have attached links to some articles that I wrote which were published in The Builders Exchange Magazine on mechanic's liens and other construction law issues. If you have a question on lien priority in another state, please feel free to contact me at the email address in my profile. I will be happy to use my network of construction attorneys across the country to try to find a lawyer who knows the laws in your state to help you. Of course, there will be no charge to do that.

Answer 2

Liens affect property according to the order in which they are recorded. A mechanic's lien will supersede any liens recorded after it was recorded as long as you take the necessary steps to perfect it. ---- Mechanic's liens, while they vary from state to state, tend to be different than most other kinds of liens because they usually have a date of priority much earlier than the date that they were recorded. In Ohio, which is not a particularly different state, we have a procedure requiring the project owner to file a Notice of Commencement prior to the start of work. Once the NOC is filed it sets the priority date of ALL mechanic's liens filed on that project at the date and time that the NOC was filed. All mechanic's liens will then have an equal priority to each other and be ahead of all other liens filed thereafter. The two exceptions are that Ohio amended its statute in April 2007 to provide that if the NOC and the mortgage are filed on the same day, even if the NOC is filed first, unless the documents provide otherwise, the mortgage will be ahead of the NOC. This anticipates that the mortgage is a purchase money mortgage because the statute already provides that if the mortgage is security for money that was used for the construction of the project, the mortgage will prime the earlier mechanic's liens. The law of your state may be different. I have written some articles for the Builders Exchange Magazine. You may link to them here http:/ohiolienlaw.com/bx/resources.php . Here is a link that contains Ohio's mechanic's Lien Statutes http://ohiolienlaw.com/bx/resources2.php . Mechanic's liens are very technical. If you are concerned about priority issues, it sounds like you might be considering a lawsuit. If you do not already have an attorney, I will be happy to try to locate (no charge) an attorney in your state to help you. I am a past Chair of the American Subcontractors Association Attorneys' Council, so I have good contacts for this kind of work across the country. Email me (in profile) with your information and I will see what I can do to help you. Russell O'Rourke www.OhioLienLaw.com

Answer 3

It generally depends on which lien was filed first.

It generally depends on which lien was filed first.

It generally depends on which lien was filed first.

It generally depends on which lien was filed first.

Answer 4

It generally depends on which lien was filed first.