- Mechanics’ Liens - Parties’ Intent Controls Whether Materials and Services are Lienable
- April 3, 2014 | Author: Meredith Eilers
- Law Firm: Bernstein Shur - Portland Office
Before beginning work, construction professionals may want to know more about an owner’s intended use for the materials and services provided.
A recent Maine Law Court decision, Thayer Corp. v. Maine School Administrative District 61, 2012 ME 37, 38 A.3d 1263, affirmed the longstanding principle that materials and labor are lienable only if the parties intended the product of that material and labor to become a permanent part of the real estate upon which the lien is asserted. In Thayer Corp., a subcontractor recorded a lien against a school based on materials and work performed to assemble and install a boiler on the school property. However, the subcontractor had been hired by an energy company whose agreement with the school provided that the energy company—and not the school—would own and operate the boiler and that the energy company would remove the equipment and restore the premises to its former condition when the agreement terminated. Based on the agreement, the Law Court concluded that the parties had not intended the boiler to become a permanent part of the real estate, and therefore the subcontractor’s materials and work related to the boiler were not lienable.
To adequately assess and manage the risk of nonpayment, it is important to know if the mechanics’ lien remedy is available.