More Mechanic’s Lien Traps
Virginia mechanic’s lien laws allow general contractors, subcontractors, material suppliers, architects, engineers, laborers, surveyors and some equipment lessors to file liens for labor and materials, but not if the labor and materials were furnished “more than 150 days prior to the last day on which labor was performed or material furnished to the job preceding the filing of such memorandum.” In addition, the lien memorandum must be filed “not later than ninety days from the last day of the month in which [the claimant] last performs labor or furnishes material, and in no event later than ninety days from the time [the building] is completed, or the work thereon otherwise terminated.” The Virginia courts strictly enforce this 90/150 day window, as illustrated by a case just decided.
On February 27, 2009, the Virginia Supreme Court decided SmithMountainBuilding Supply, LLC v. Windstar Properties, LLC, in which a supplier had filed two memoranda of mechanic’s lien. Both of the memoranda included materials provided outside the 150 day limitation. The owner moved to dismiss the supplier’s lien enforcement suits on the grounds that both liens were invalid and unenforceable because they included sums for materials supplied outside the 150 day limitation period. The Supreme Court agreed. In doing so, the Court rejected the supplier’s argument that the inclusion of sums due for materials furnished outside the 150 day limitation period was merely an “inaccuracy” that should not invalidate the liens. Thus, the supplier lost the benefit of both liens, even though each of them also included materials that were supplied within the 150 day period and therefore properly lienable.
The moral of the story: if you include both old and new materials or labor in your memorandum the court will throw the good out with the bad. When in doubt, file separate lien memoranda for the old and the new materials or labor.