If you are a contractor, subcontractor, or supplier and you have performed work on a property and met the standard that was set forth in your contract, you deserve to be compensated by the owner. Unfortunately, this isn’t always the case on construction projects when owners run out of funds or refuse to pay after the project is completed. There is a solution to this problem — a Houston construction attorney can assist you with perfecting a lien against the property.
In this two-part article, the attorneys at Cotney Law will discuss lien laws in Texas. In this section, we will focus on the topic of lien priority. In the second section, we will discuss the various deadlines that construction professionals must meet to perfect a lien after they finish working on a project.
Hierarchy of Perfecting a Lien
If you are a construction professional and interested in perfecting a lien, the first thing you need to know is that there is a hierarchy system in place to successfully complete this process. In other words, there are several tiers to successfully perfecting a lien and depending on your position on the project, the notice requirements can differ greatly.
Here is a basic outline of the chain of command when perfecting a lien:
General Contractor: The general contractor that directly agreed to a contract with the owner is the top-tier professional in the chain of command to perfect a lien. Because the contractor entered a contract with the owner, they do not need to file a notice.
Subcontractors and Suppliers: Directly contracted by the general contractor, subcontractors, and suppliers that provided work on the project are included in the next tier of perfecting a lien. Subcontractors and suppliers must comply with lien notice requirements in order to file a lien.
Other Construction Professionals: Sub-subcontractors that are hired by a subcontractor to perform work on the project are in the lower tier along with the suppliers they hired to provide materials for the project. If these professionals want to perfect a lien, they must provide notices to both the owner and the general contractor.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.