Legal Question in Business Law in California

Re: mechanic's lien

Based on the facts as presented, you don't have the right to file a mechanic's lien. You need to file a lawsuit and obtain a judgment before you can start going after the assets of the company.

A mechanic's lien is something filed by a contractor or other construction industry related creditor when payment is not received for labor, services or materials.

Re: mechanic's lien

This doesn't sound like a mechanic's lien situation. You may be a mechanic, and you may be owed a debt, but that is not what mechanic's liens are about. A mechanic's lien is a pre-judgment right possessed by someone who has performed labor or furnished equipment or materials for a work of improvement on real property.

Lenders are not entitled to mechanic's liens.

If you are talking about foreclosing on the equipment, which stands in the ownership of the out-of-business company, or perhaps has been transferred to the owners of the out-of-business company, you can't do that unless you have a security interest in the equipment, i.e., the specific equipment was pledged as collateral for your loan.

Failing that, you are going to have to sue and get a judgment. There is an additional possibility worth mentioning - maybe you can get a pre-judgment writ of attachment after filing suit but before getting a judgment. Your lawyer can advise you if this is likely and how to apply.

The stockholders, directors, officers, partners or whatever of companies that go out of business without paying the business bills can often be reached for personal liability under one or another of several legal theories. So, even if the company has been bled dry, you may have recourse against the individuals involved.

The company's not having filed bankruptcy is perhaps better for you. However, you aren't (it seems) in a position to take advantage of the mechanic's lien laws.