I did not file a mechanic lien, when I should have. It's been more then a year, then I came across the invoices that were not paid. What can I do at this late date?
1 reply
Nov 1, 2019
Mechanics liens are a powerful tool for recovering construction payments, but they're hardly the only tool available. Let's look at some options that may still be on the table.
Other options for recovering payment when a mechanics lien isn't available
There are a variety of options that might be on the table - some more formal than others.
Invoice reminders and demand letters
On the less-formal end of the spectrum, simply issuing invoice reminders may be enough to get paid or to at least get the payment talks moving in the right direction. Sometimes, a little push is all it takes. So, sending a reminder that invoices remain outstanding could be a good first step.
In a situation where a friendly reminder might not be enough, escalating things a bit with a demand letter may do the trick. A demand letter informs recipients that you're serious about getting paid and that you will do whatever it takes to get what you're owed. And, including specific legal threats that may be on the table can help make a demand letter more effective. More on that here: Demand Letters for Contractors – How To Write One That Gets You Paid.
Legal recovery options are likely available
On the more formal end of the spectrum, there are likely a few different causes of action that might be on the table.
Any time payment isn't made, as required, there's a strong chance a breach of the contract has occurred. So, pursuing a breach of contract action could lead to payment of outstanding invoices - and the deadline for making contract claims is generally far beyond the timeframe for making lien claims.
Further, Maryland is one of many states which has prompt payment laws on the books. These laws require that payment be made within specific timeframes - usually about a week within the timeframe your customer gets paid. And, progress payments must be made to prime contractors within 7 days of the expected payment timeframe unless they contain disputed amounts. When a Maryland contractor seeks payment under the state's prompt payment laws, the customer who failed to make payment will generally have to pay interest, too - which should provide a little extra incentive to resolve the matter outside of the courts.
If legal action is necessary, small claims court can help streamline recovery
When a claim is $5,000 or less, a Maryland claimant can typically bring their claim in small claims court. Compared to traditional litigation, small claims court allows a claimant to proceed with fewer costs and a streamlined process. And, a claimant can often proceed with their claim without the help of an attorney. More on Maryland small claims court here: Maryland Small Claims Court.