Once a Mechanic’s Lien is filed, there are several ways to remove the lien, as follows:
Payment of Lien
This is the simplest method and is self explanatory. Of course it is not the preferred method, especially if there is a valid objection to payment of lien amount. If you choose this option, you should still retain an attorney to make sure a proper release of mechanic’s lien is signed and filed. We charge $500 to draft and file a mechanic’s lien release.
Bond
This method requires the owner to post a bond. A bond is an insurance policy that covers the payment in case the lien holder is able to enforce the mechanic’s lien. A bond, like any insurance, costs money and may be difficult to obtain in some circumstances. If you choose this option, we can assist in filing the bond and getting a release of lien for $500.
Discharge by Deposit
This method requires the owner to deposit the amount of the lien (plus interest) into court. The lien is then removed from the real estate and placed on the funds deposited into court. The owner still has the same defenses he or she would have had, except the real estate is free of the lien. The drawbacks are obvious in that full payment (plus interest) has to be paid to the court and is frozen until resolution of the mechanic’s lien.
If the mechanic’s lien expires and is not renewed, the owner will have to file a motion with the court to return the deposited funds.
The Levin Law Group can assist with Depositing the Funds into court and eventually (if applicable) filing a motion to return the funds. We charge $500 to deposit the funds into court and $1,500 plus filing fees to file a motion to release the funds.
Failure to Prosecute
Before a mechanic’s lien expires, the owner may serve a notice upon the lienholder demanding that the lienholder file an action to foreclosure on the lien within 30 days. This creates a 30 day deadline from the date of service to enforce the lien. Failure by the mechanic’s lien holder to bring an action to foreclose within 30 days, the owner can file a motion to vacate the lien for failure to prosecute.
The Levin law Group can assist with sending the 30 day notice and eventually (if applicable) filing the motion to vacate the lien. We charge $500 to send the notice and $1,500 plus filing fees to file a motion to vacate the lien.
Facial Defect
If a Mechanic’s Lien has a defect in the language of the lien, it can be dismissed through a special proceeding under Section 19 of the Lien Law in New York. Facial defects include:
- Wrong name of party,
- Wrong property address,
- Using a PO Box for the lienholder’s business address,
- Out of state lienholder not using a NY Address or a NY Attorney’s address,
- Not including all information required by the lien law, or
- Other defects.
The Levin Law Group charges a Flat Fee of $2,500 + Filing Fees for a Section 19 Proceeding to dismiss a Mechanic’s Lien based on a facial defect.
Litigation on the Merits
The last method to dismiss a mechanic’s lien involves litigation. The owner can challenge the lien if for example the amount claimed has been paid and is not due to the contractor or the amount of the lien has been intentionally exaggerated. An owner can also raise any other defenses, such as a contractor’s breach of contract or negligence in the work performed. Since this involves actual litigation and potentially a trial, the Levin Law Group requires a $5,000 retainer for mechanic’s lien litigation.