Ask the Legal Professionals, Phoenix Business Journal, March 23, 2012

Published on in News Articles

Q. I am the owner of a commercial building and we just obtained the Certificate of Occupancy from the City.  I’m told that after receiving my final payment, the general contractor closed its doors before he paid his subcontractors and suppliers.  Can his subcontractors and material suppliers record mechanics’ and materialmen’s liens against my property?  If so, are there any limits on when those liens can be recorded? 

A. Any subcontractor or supplier that served you with a Preliminary Twenty Day Notice, that hasn’t received payment in full or otherwise executed a statutory lien waiver, may have lien rights against your property.  Under the lien statute, subcontractors and suppliers have to record their liens no later than 120 days after completion.  In this situation, completion is defined as 30 days after the date your Certificate of Occupancy was issued by the City.  You can shorten the allowable time for filing liens by recording a Notice of Completion with the County Recorder and serving the Notice by certified or registered mail on everyone from whom you’ve received a Preliminary Notice.  By recording a Notice of Completion the time period for recording liens against the property is shortened to 60 days after completion.

Ask the Legal Professionals, March 23, 2012

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