When a person provides labor, material, or services to a residential construction project without a contract with the owner (e.g., subcontractors or suppliers), Maine’s mechanic’s lien law provides a “double payment” defense for the homeowner. Under Maine law, most residential subcontractor and supplier liens can only be enforced to the extent that there is a “balance due” for the labor, materials, and/or services covered by the lien to the person with whom the owner has a contract with (e.g., general contractor). In other words, if a homeowner has paid his or her general contractor for the work that is the basis of the lien, the lien will not be enforceable. The homeowner is protected from having to pay for the subcontractor’s or supplier’s work twice. A subcontractor or supplier lien will only be enforceable to the extent that the homeowner has not paid for the work.
This is of obvious concern for subcontractors and suppliers because on most residential projects, payments from the homeowner flow through the general contractor. Therefore, if a general contractor fails to pass through payments to its subcontractors and suppliers, this can effectively reduce or eliminate their ability to lien the project.
Thankfully, subcontractors and suppliers can protect themselves against a “double payment” defense by providing written notice to the homeowner notifying the homeowner of their work (or intent to supply work) on the project, and warning the homeowner that he or she must ensure that the subcontractor or supplier receives payment for their work. Any payments made by the homeowner to the general contractor after receipt of this notice will not be considered for purposes of the “double payment” defense and cannot be used to reduce or negate the subcontractor’s or supplier’s lien.
Under Maine’s mechanic’s lien laws, this written notice must include specific information and language in order to be effective. Therefore, subcontractors and suppliers should work with an attorney to draft and create a form document that can be used on residential projects. Doing so is a simple step to help ensure timely payment on residential projects.
Perkins Thompson regularly helps owners, contractors, subcontractors and material suppliers with mechanic’s lien issues. If you would like to speak with the firm about a mechanic’s lien issue, you can send an e-mail to Joe Talbot or call him directly at 207-774-2635.
