Construction Law News Blog

Showing 8 posts in Mechanics’ Liens.

Mechanic's Liens Take Priority Over A Mortgage

Recently, the Hamilton County Court of Appeals found that mechanics’ liens filed by the prime contractor and subcontractor on a project took priority over a mortgage in Bank of America v. Omega Design/Build Group, LLC, et al. (Apr. 6, 2011), 2011-Ohio-1650, 2011 WL 1261301. In Bank of America, the owner contracted with a prime contractor and the subcontractors on a project for a multistory condominium complex. Bank of America was the lender for the project. Bank of America sought to foreclose upon the condominium complex and for priority over mechanics’ liens filed by the prime contractor and subcontractors. 

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Contractors' Reliance on Erroneous Information From County Auditor Does Not Save Defective Mechanic's Lien

The Indiana Court of Appeals recently rendered a decision that should give all Indiana contractors pause before recording a mechanic’s lien. In Capital Drywall Supply, Inc. et al. v. Jai Jagdish, Inc. and Ranjan Amin, 934 N.E.2d 1193 (Ind. Ct. App. 2010), the court affirmed summary judgment in the owner’s favor where the mechanic’s lien claimants identified the improper owner on their Mechanic’s Liens even though the improper identification was based upon erroneous information received from the County Auditor. Read More ›

Bond Form Makes a Difference in Ability of Owner to Obtain Benefits of Bond

The recent case of St. Paul Fire & Marine Ins. Co. v. VDE Corporation, 603 F.3d 119 (1st Cir. 2010) points to the importance of selecting an appropriate bond form and adhering to the terms of the bond. Read More ›

Mortgagees in Indiana Have Priority Over Mechanic's Lien Holders Improving Land for a Residential Subdivision

Prior to the economic downturn, there was no shortage of residential subdivisions being developed and built in Indiana. One issue which emerged from such construction was the relative priorities afforded to those who funded the development and those who made the improvements to the development prior to the construction of any residences where the owner failed to pay. On August 10, 2009, the Indiana Court of Appeals resolved this issue in Lincoln Bank v. Conwell Construction, et al. The Court of Appeals held that the mortgagee had priority over the lien claimants. The property was platted and developed as a residential subdivision. The general contractor agreed to construct improvements, infrastructure, and storm, sanitary and water utility structures. In furtherance of its obligations, the general contractor entered into multiple subcontracts for the construction of concrete curbs and gutters, subsurface curb drains, and asphalt paving. The mortgagee funded the development and recorded its mortgage in 2006. The four lien claimants later filed mechanic’s liens in 2007. Read More ›

A Desk Reference to Ten Mechanic's Lien Common Mistakes

Being a creature of statute, the mechanic’s lien process contains many pitfalls for the unwary. While there are a number of ways a claimant can run into problems during the mechanic’s lien process, the following presents ten common mistakes encountered. Read More ›

Search Twice, Foreclose Once

The old adage of "measure twice, cut once" can be appropriately adapted to lien foreclosure actions. Failing to identify all lienholders, including those considered to be junior lienholders, and naming them as parties to a foreclosure action can be costly. A bank recently learned this valuable lesson. In Deutsche Bank National Trust Co. v. Mark Dill Plumbing Co., 903 N.E.2d 166 (Ind.Ct.App. 2009), the bank foreclosed on its mortgage without adding three junior judgment lienholders to the foreclosure action. After the bank purchased the property at a Sheriff’s sale, it learned of the junior lienholders. In order to quiet title on the property, the bank filed an action to remove the judgment liens belonging to the junior lienholders. The junior lienholders requested that the bank's equity of redemption be foreclosed and another Sheriff's sale be held to satisfy the amounts owed to them. Read More ›

Commencing Construction Projects in Kentucky Without Obtaining Stormwater Permits can be a Costly Proposition for Property Owners, Developers and Contractors

The 2009 stimulus package is expected to provide funds for a several large public and semi-public construction projects in Kentucky. For developers and contractors involved in those or other construction projects in the Commonwealth this year, however, the most significant “stimulus” they feel may be the “pain” in their pocketbooks if they commence their projects without first obtaining the necessary stormwater permits, or if they ignore their permit obligations during the construction of the project. Read More ›

Honesty is Best Policy in Judgment-Debtor Exam

Given the current economic times, greater emphasis will be placed on collecting debts that are owed. Once a debt is reduced to a judgment, various collection options are available. One of the most common steps for debt collection is a judgment-debtor examination. In many respects, these are routine efforts used to identify the location of assets which could be used to satisfy the judgment. The recent case cited as Ohio Department of Taxation v. Kunkle, 179 Ohio App. 3d 747, 2008-Ohio-6393 is an example of potential strategies and also risks that can be encountered if the testimony provided at a judgment-debtor exam is less than truthful. Read More ›

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C. Michael Shull, III focuses his practice on construction law and litigation. Michael's client representations range from casinos and ENR Top 400 contractors to design firms and subcontractors.

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