Legal Question in Construction Law in California
Mechanic Lien by Suppliers & fired GC
We recently fired out GC (he breached every term of the agreement). We recieved a mechanic lien notice filed by a supplier (Lumber company) by way of a notice from the supplier's attorney stating they would foreclose in 6 days if we did not pay. We NEVER recieved a notice of default payment prior to the ML. The billing office stated that their policy was to send default notice to the GC - but the GC never told us. We suspect the supplier is acting maliciously becuase a few month prior B4 GC was fired, we asked the lumber company about the excessive mold growing actively on the framing. GC was asked to look into this many months prior but did not pursue. Lumber company attorney sent notice that they were not liable. GC subs told us (see below) he is spreading rumors we will sue his subs/suppliers and that may have preempted lumber company to file a ML without giving us default notice.
Recently many subs (discovered GC used unlicensed tradesmen) came to us for unpaid balance. We got 2 more default notices from suppliers. 90% of GC work failed county inspection. We over paid GC so we asked for refund. GC stated he rather go to jail than fork up money. 7/26/07:We filed complaint w/ CA licensing board - to date nothing.
2 Answers from Attorneys
Re: Mechanic Lien by Suppliers & fired GC
Certainly sounds like litigation looms near. Interesting case, but too many essential facts are missing for a construction lawyer to give a good appraisal.
For example, did anyone send you a 20-Day Preliminary Notice? If not, this could be a defense to the ML actions. Was the lumber supplied directly to you or to your GC? If to the GC, your GC might have a duty to defend you against the ML foreclosure action. Are you sure that the GC committed a material breach, and not just a minor breach of the contract? If a court finds that the GC substantially completed the project and was just having trouble passing the inspections, your firing the GC could be the first "material" breach. Was this a work of improvement on your personal residence? If so, many consumer protections come into play, and we would need to review your contract carefully.
These issues only scratch the surface of what's needed to give a full and proper answer. If you are interested, I'm in the bay area and would be happy to chat with you more about the case.
Re: Mechanic Lien by Suppliers & fired GC
Anyone not in direct contract with you should send you a 20-day preliminary notice of lien before recording a mechanic's lien.
In addition to Mr. Meyer's advice, I would suggest looking at the records of your parcel at the County Recorder's office to see what's really been filed since the job began. Some of the threats may not be backed up by actual filed liens.
If and when anyone begins an actual foreclosure proceeding, be SURE to get a lawyer and respond before any deadline in papers served on you.
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