- Location
- Placerville, CA, USA
- Occupation
- Retired PV System Designer
Making the most of his zero interest loan. :happyyes:
Liens and legal issues
- Thread starter goldstar
- Start date
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electrofelon
Senior Member
- Location
- Cherry Valley NY, Seattle, WA
Yup
One thing that sticks out.
You have to file a notice with the owner. The lessee is not the owner. The tire company has no liability to this claim.
The owner needs the notice so he can protect himself from liens that were not caused by him. All States have different rules but this is one that is pretty common throughout.
Florida has a 45 day from the beginning the day you step on the project to file your notice. And, 90 days after you leave. And don't try to fudge because you ran out of the ninety and try to go back to do remedial work to start the clock over. That trick has been tried too many times and they look for it.
We did mostly bonded work so only the ninety on the back end applies. And, if you're on a public project, make sure they are bonded. Get the bond number. The general has to supply it so you can get it to your material guys. A notice to owner is worthless. You can't sue the King, which is the public property.
You have to file a notice with the owner. The lessee is not the owner. The tire company has no liability to this claim.
The owner needs the notice so he can protect himself from liens that were not caused by him. All States have different rules but this is one that is pretty common throughout.
Florida has a 45 day from the beginning the day you step on the project to file your notice. And, 90 days after you leave. And don't try to fudge because you ran out of the ninety and try to go back to do remedial work to start the clock over. That trick has been tried too many times and they look for it.
We did mostly bonded work so only the ninety on the back end applies. And, if you're on a public project, make sure they are bonded. Get the bond number. The general has to supply it so you can get it to your material guys. A notice to owner is worthless. You can't sue the King, which is the public property.
goldstar
Senior Member
- Location
- New Jersey
- Occupation
- Electrical Contractor
What you're saying sounds like it should be correct so I'm not challenging you here. However, how does a tradesman protect himself if he cannot file the lien on the property irrespective of whether the tire company owns the property or not ? The entity that owns the building leased that building to the tire company. The tire company made improvements to that building, which now, for all intents and purposes, become appurtenances to that building. That means that if the tire company decides to move out they can only take portable things (like tools, etc.) with them. The car lifts, air compressor, lighting, switching, receptacles and electric service stay put. In all fairness, how can the property owner now claim that they are absolved from all liens caused by the tire company ?
- Location
- Placerville, CA, USA
- Occupation
- Retired PV System Designer
What Gary is saying, fairness aside, is that to protect himself the tradesman must file the lien on the property against the owner, not the company that hired him. The owner of the property, if he is aware of the tenant improvements , can take some action before the start of construction to disclaim responsibility for the work and protect himself from a lien, leaving the responsibility to the tenant and possibly leaving the tradesman with no (or reduced) recourse.
kwired
Electron manager
- Location
- NE Nebraska
- Occupation
- EC
Some of those items you mentioned stay put, I don't agree that all of them do. Car lifts - maybe depends on the style, air compressor can likely go with the tenant if they leave, if they supplied it. Does owner claim the air compressor as their property or does the tenant claim it when it comes to tax purposes? If extensive enough audit were done they can't both (fully) claim it.
gadfly56
Senior Member
- Location
- New Jersey
- Occupation
- Professional Engineer, Fire & Life Safety
Who owns what is a matter of the lease agreement. I had an acquaintance who discovered this to his cost. He paid the cost of a new HVAC unit for his business and found that because it was a leasehold improvement, the depreciation went to the landlord, not him. I'm pretty sure he read the next lease agreement more carefully.
kwired
Electron manager
- Location
- NE Nebraska
- Occupation
- EC
HVAC is often part of the premises. The landlord should be paying for it in most cases. Deadbeat landlords sometimes don't though, person leasing sometimes does what they have to do. Legalities of taking tax breaks from such things I agree can get more complex when it doesn't go the way you think it should. If that happens too often tenant is probably looking for a new place to lease, unless he thinks he is getting a steal in the first place - then he just puts in the new HVAC anyway.
Yes, you are protecting yourself by giving notice to the correct entity. The owner of the property is the one that will end up having his/her building with a lien on it so you have to give the notice to the owner because they have rights too. The notice is, in fact, to protect the owner from what could happen here. He has no knowledge that a transaction has occurred and now has a lien on his property. The tradesmen have a responsibility to give notice if that is the law.
I know, it doesn't seem fair. I'm pointing this out to tradesmen so they can protect their rights because there is a clock ticking when you start the job. At least in Florida, you have 45 days to give notice to the owner. This is how it works and most States have a similar way of doing it. In Texas, we all get screwed!
If the tradesmen didn't give notice to the owner in this instant and thought he/she would go after the tire company directly then they would end up with no rights to recover by putting a lien on the building. You would have no recourse in that regard. They may have other legal ways to recover the money, but not to the extent to lien the property.
Now, if you did a proper lien, it would now be between the owner and the tire company. If the owner did his/her due diligence upfront in regards to the contract lease, he/she may have legal recourse to seize the tire companies property or whatever it takes to make the owner whole because of this lien. But that is a completely separate issue to the original notice.
What is so lousy here is; What if the tire company paid the general and he/she ran off with the money? And now the tire company and the owner are footing the bill. If I'm the owner of the building there's no way I should be responsible for that. And, he/she has a point.
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