Monthly Archives: April 2012

Rental Demand Drives New Commercial Construction in Southern California

The long dry spell in Los Angeles’s commercial construction market may be comming to a close.  The Los Angeles Times recently reported that commercial real estate developers are building again, buoyed by strong demand for apartments. With unemployment still high and Americans still skittish about putting their money in a house that may still decline in value, rents have increased as that option has become more palatable.
According to the LA Times, the increase in construction in Southern CA is attributable to the “revival of projects that stopped during the recession, but many others are new from the ground up…”
As building gains economic steam, it is important for everyone in the building process to preserve their rights to get paid for the labor or materials they provided. Mechanics lien are an important part of that process.  In California, liens filed on private property are known as Mechanic’s Liens. When a California mechanics lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Click here for more information on California mechanics liens, or give a call at 888-543-6765.

Credit Manager Solutions: Part 3 of the Series: Deciding to File a Mechanics Lien

Deciding to file a mechanics lien is a often a difficult decision. It should not be.  Many companies do not want to upset their customers by filing a mechanics lien, but a mechanics lien is the only way that the law permits you to securitize the value of the labor and materials you provided to a project. Rather than upsetting a customer, companies will simply allow the mechanics lien deadline to pass, thereby waiving a valuable legal right.

However, the reality is that a mechanics lien can have an effect that results not only in your company getting paid more quickly, but also as a company that will tolerate only so much when payments are not made for work or materials provided to a project.

Here are some suggestions to help you decide to go ahead with deciding to file a mechanics lien.  Each “yes” answer is worth one point. If you reach 2 or more points, then it may be time to decide to file that mechanics lien.

*Have payments on the project been consistently late?
*Has the amount owed to you exceeded your internal limit on receivables?
*Is the deadline for filing a lien approaching?
*Have you completed your work or delivered your materials more than 30 days ago?
*Have you heard of other companies filing liens on the Project?

If you answered yes to more than one of these questions, then you may want to file a mechanics lien claim.  If you feel nervous about actually filing a construction lien before giving any notice, you can always provide the owner and anyone you have a contract with what is called a “prelien notice” or “notice to owner.”  It’s a warning shot that lets everyone know that you’re about to file a construction lien before you actually pull the trigger.

The nationwide mechanics lien filing tools provided by complete the job of collecting unpaid project money. File a lien on the property with ease through our online system. We can help with all the different documents you need for a property lien. Use all the tools at your disposal, use

Credit Manager Solutions: Part 2 of the Series: Security & Collections

Credit managers aren’t lawyers, but they do need to know the law…at least as it relates to keeping their receivables secure and preserving the company’s legal right to collect. When securing a receivable is not done, or isn’t done correctly, collecting the money owed can become more difficult.

Construction projects in general provide a special legal right to collect money: the mechanics lien or construction lien claim.  Depending on what State the project is located in, different rules can apply to filing a mechanics lien. If you are not using a construction lien filing service like, then you should make sure you know the rules to filing a property lien in that State.

To secure your collections you don’t need to play hardball with your customers. Friendly phone calls can work just as well as threatening letters, and when payment is still not received, going the legal route by filing a mechanics lien has a big effect. Having a solid compliance system can mean the difference between receiving prompt payment and wasting valuable time and effort and not getting paid.

Questions that often arise in any given situation are:

  • How many times should I call before I move this into a more aggressive mode?
  • How many days should I allow a receivable to age before I file a mechancis lien?
  • When is the last date of completion?
  • What work is lienable?
  • Can I lien for late charges, extras and the like?
  • I have a “no lien” contract. Is it valid or enforceable?
  • Do I have a lien if all project funds have already been disbursed?

Each of these questions are ones that credit managers ask themselves every day, and many of the answers vary state to state. Having a company like to assist you in answering these questions can be invaluable.

Cool Post of the Day: Auto Car Wash Makes it to Skyscrapers

An automated window washer for high rise buildings? Well that’s what Skydrowasher(TM) Window and Building Washing System does.  It’s an automated washing solution for high-rise window cleaning services and commercial building owners.

Sky Pro manufactures the systems, and claims that it cleans a high-rise building’s windows and exterior using high pressure water to “scrub” the surface from a distance up to three feet. The Dual Skydrowasher(TM) High Pressure Window and Building Washing System is ideal for “cleaning buildings with window offsets, curves, recesses, overhangs, protrusions, inset glass, asymmetrical frames or other architectural features that make traditional cleaning methods difficult, if not impossible.”

The System uses turbo nozzles mounted within a high-impact plastic shell, and it does not require electricity to operate as it runs on water pressure alone! Pretty cool.  The dual Skydrowasher can clean at an incredible rate of 18,900 square feet per hour or 315 square feet per minute. At this speed, the Dual Skydrowasher(TM) System cleans 7 to 10 faster than two men on a scaffold.

If you are an architect, building owner, window washing company, building management or maintenance company, you might want to take a look at the Sky Pro System.

For more information, visit or call Mike Dancha at 1-800-800-WASH.

Credit Manager Solutions: Part 1 of the Series: Go Behind the Scenes

In our line of business, we deal with a lot of credit managers.  From large to small companies, each one has a different way of doing things and ensuring that the company gets paid for the work or materials they provide to a construction site.  While placing a mechanics lien or a construction lien on a property is one way to secure payment, there are several other steps that credit managers should follow to keep those accounts receivables down to a manageable level

Over the next couple of posts, we’ll be looking at ways for credit managers or account managers to maximize their collections potential and become one of the most valuable people in their company.

Go Behind the Scenes or Look Behind the Curtain

Interpreting creditworthiness from the start is a main goal of a credit manager. Running a credit check on potential customers is important, but what kind of check should be run.  The normal reports from Dunn & Bradstreet provide generic, not always useful information. Here are some things that LienItNow’s Credit Check department does that you may want to use yourself.

*The length of time the company has been around.
*If the company is still filing annual reports with their State of Incorporation.
*The company’s average credit line and hight available credit line
*Average turnaround on paying bills in number of days.
*The length of time with the company’s current bank.
*How long the company has been doing business with its trade references.

Try checking into those items and you may find yourself spending less time chasing money.  Remember, the credit manager’s job is to be proactive, rather than a reactive. In the next post we’ll discuss securing your right to collect.

Real Estate Owner Research Can Be Critical to Your Lien: Make Sure you Do It.

With the economy still not back on track, every day we get more calls and emails asking about the filing of a mechanics lien or bond claim. With financing still shaky, and owners and contractors running out of money, non-payment issues abound.

At Lienitnow, we take the time to double check owner information. More often than you’d think, we find that the owner listed on the construction contract is not the same owner that holds the deed to the property. Sometimes, in homeowner cases, we will find that the owner listed on the contract does not actually own the property, his wife does, or another relative owns the property. In some cases, we’ve found that a nickname was used, rather than the legal name, on the residential construction contract.

On commercial projects, many of our clients assume that when they are building a Target or a Albertsons, that these companies are the actual owners of the properties. In fact it is rare for a large corporation to own a property on which their store is being built, and even rarer for the record name of the property owner to be the same as the parent company. 

This issue is more complicated when your work is only on a portion of a property that houses multiple street addresses. As is clear from the mechanic’s lien statutes, failure to properly name the owner of the property can be fatal to the lien. With that in mind, finding out who owns the property is key.  

Whenever you file a mechanics lien, you should make sure that you have looked into and verified the owner of the property with the local government authority that keeps track of property ownership. At, which provides mechanics lien filing services, the company performs this service for you, and verifies the owner with the county clerk.  If the owner you have is different that the one found by LienItNow, you can then make a decision as to whether you want to perform a title search to delve further into the issue.

Just be sure to double check the real estate owner information before you file your mechanics lien and you will be glad you did.

New Jersey Slams Residential Contractors: Files Suit against Several Companies & Owners

Some Northern New Jersey residential home improvement companies have been sued by the state Attorney General’s office and the State Division of Consumer Affairs.  Steming from complaints from nearly 70 consumers, including five from Monmouth County, six from Middlesex County, four from Union County, three from Somerset County and one from Morris County, the allegations are wide ranging, including:
  • Failure to honor warranties and guarantees
  • Failure to properly make required repairs to defective work
  • Failure to return customer deposits despite failing to perform the work
  • False advertising: the companies apparently indicated that they were linked to a government agency
  • Failure to obtain required permits prior to performing the work

According to the Attorney General’s office, the New Jersey Residential Construction Contractors left homeowners with dangerous and unsafe conditions, including fire hazards.  The lawsuit, which was filed by the state authorities in Bergen County, was filed against the following companies: A-1 American Construction Inc., A 1 American Chimney Limited Liability Company, Brick City Chimney Service LLC., Brick Chimney Service and Cleaning Inc., and Roofing Police or Roofing Squad. The lawsuit has also named the alleged owners and co-owners of the companies: John Kot, 41, of Garwood and Gabriel R. DaSilva, 43, of Paterson.

The State indicated that the allegations are a result of an investigation that revealed wide randing Consumer Fraud Act violations.  In at least one case, a company was hired to perform a roof repair, but refused to come back and fix a leak that resulted from the repair.

The state is seeking restitution for consumers, and has requested that the companies and the individuals be fined in order to cover the Sate’s costs for the investigation and attorney fees.

Empire State Building No Longer Tallest Building in NYC.

After 11 years of once again dominating the New York skyline, the Empire State building can no longer claim that it is the tallest building in NYC. One World Trade Center, being built at the site of the fallen twin towers, will eclipse the Empire State Building’s claim of being the tallest building in New York.

The Empire State Building, the a 102-story landmark skyscraper and American cultural icon in New York City at the intersection of Fifth Avenue and West 34th Street., is 1,454 ft (443.2 m) high. The name is derived from the nickname for New York, the Empire State. It stood as the world’s tallest building for 40 years, from its completion in 1931 until construction of the World Trade Center‘s North Tower was completed in 1972. Following the September 11 attacks in 2001, the Empire State Building was again the tallest building in New York (although it was no longer the tallest in the world). Once the new One World Trade Center is completed, the Empire State Building will once again be demoted to second tallest building in New York.
Port Authority Executive Director Patrick Foye told reporters: “Weather permitting, we expect that we could exceed the height of the Empire State Building on Monday,” When completed, One World Trade Center will stand at 1,776 feet (541 meters). The completion date is currently scheduled for 2013.
One World Trade will be even taller than the former twin towers. The north tower of the Twin Towers stood 1,727 feet (526 metres) including its antenna.

For more information on the progress of One World Trade Center’s construction, click here.

For contractors that are interested in filing a mechanics lien in New York on public or private projects, try

Lend Lease Fined $56 Million for Alleged Fraudulent Construction Practices

After a wide ranging investigation by Federal Authorities, one of the world’s largest construction firms, Lend Lease, formerly (and commonly known as) Bovis Lend Lease, was fined $56 million for fraud perpetrated on projects ranging from Federal, State, City, County and private projets.

The fine was levied after intense negotiations permitted the company to escape Federal prosecution for the fraud, which extended over a 10-year period, including over-billing and ignoring minority hiring mandates at New York landmarks, such as the Mets’ baseball stadium and the September 11 memorial site. FBI assistant director-in-charge Janice Fedarcyk said the plea concluded a three-year probe ”into a systemic pattern of audacious fraud by one of the world’s largest construction firms”.

Bovis is the construction arm of Australian based Lend Lease, and is the entity that agreed to pay the fines, which included ‘victim restitution.’  A hearing was held on April 24, 2012 in the US District Court in Brooklyn, NY, at which point the fine was levied by the court. Accused of fraudulent overbilling and manipulating minority hiring program requirements, the US Attorney Loretta Lynch indicated that the main defense given by Bovis was that “everybody does it”.  US Attorney Lynch states that “the defense of ‘everyone does it’ will not be a shield against law enforcement.”

As for corporate employees and officers, only one was charged with fraud.  James Abadie, who formerly led the company’s New York office, pleaded guilty to conspiring to commit fraud for over-billing Bovis’ clients for more than a decade. Abadie, 55, faces up to 20 years in prison.  It’s interesting that only one person was indicted for “conspiracy”: we thought it took more than one person to make a conspiracy. Bovis, on the other hand, is on a 2 year good behavior stint and may be prosecuted if it violates laws during that time period.

In a nutshell, the company admitted that, as a matter of practice, it added two hours of unworked overtime to timesheets for labour foremen and charged customers for weeks when foremen were on vacation or out sick. Court papers indicated this is a common and unsavory practice where unions have heavy influence on the number of hours worked by their members and work slowdowns can severly affect a project.

Electronic, Instantaneous Filing with No Clerk Meddling? A proposal by Iowa Legislators

Iowa is charging into the future, and not by cavalry. The State is considering making Iowa Mechanics Lien Fiing a state function, rather than a county function, and is on the verge of making the filing electronic. Now that’s some interesting news. Let’s see if it gets passed.

Iowa House Bill HF675 proposes to change the Iowa Mechanics Lien Law in a couple of ways, but the most important is that it seeks to create a statewide construction registry internet website that would be administered by Iowa’s Secretary of State. On that construction industry internet website, anyone eligible for a mechanics lien who furnished materials or labor would be able to post their mechanic’s lien electronically online.

As of now, the filing of a mechanics lien is a cumbersome, painful process. The filing is similar to that done in most states: send it to a county clerk or district court, hope they see it and file it, and hope they don’t get confused or try to interpret a statute incorrectly and reject the lien. Attempting to file a lien can be pretty nerve racking.

The new registry, however, would allow all interested parties, in fact the public at large, to view the registry and see whether any mechanics liens exist on a certain property. It would also come in handy to owners, subcontractors and suppliers because it would provide real time, up to date information on what mechanics liens are in play, keeping payment flowing to the proper parties. For banks and lenders, it would provide a more accurate way of determining whether liens exist on the property prior to closing a sale or financing.

With every bill, however, comes new requirements. Here are the couple of new requiremets the Iowa Mechanics Lien Bill proposes:

1. The general contractor or owner or developer must post to the state construction registry internet website a notice of commencement of work, and
2. Easch subcontractor must post to the registry an Iowa preliminary notice, or Iowa Notice of Furnishing, informing the owner that materials or labor are being provided. If the sub-contractor does not file the notice, they are not entitled to a lien.

Like many bills passed over the past few years, the Iowa Mechanics Lien bill was the reult of the financial crises. Over past several years numerous developers, construction companies, and homeowners have gone out of business and bankrupt. The filing of mechanics liens in the wrong counties, incorrectly, and the improper recording of the liens by clerks led to numerous litigation, and the statewide system is thought to resolve the issue.

If the bill becomes law, it could be another moment where Iowa takes the lead for other states to follow. A statewide system is aleady used for Judgments in most states…extending it to mechanics liens just makes sense.