Colorado Mechanic’s Liens – Three Key Steps
August 26, 2024
In construction projects, non-payment issues often arise. Mechanic’s liens are filed on the property where the work was performed and are an important tool for construction professionals and material suppliers to obtain payment.
However, because the statutory requirements for mechanic’s liens are strictly enforced it is critical that the requirements are followed. Here is a summary of the steps that must be followed:
- Notice of Intent to File a Mechanic’s Lien: The first step in filing a mechanic’s lien is notifying the owner(s) of the property and the principal contractor that you intend to file a mechanic’s lien (“Notice”). The Notice must be delivered by personal service or by registered or certified mail, with return receipt requested. You must mail this notice within ten (10) days of recording the mechanic’s lien.
- Record your Lien: Ten days after you have mailed your Notice, you can record the mechanic’s lien with the office of the clerk and recorder where the property is located (the “Lien Statement”). The Lien Statement must be signed and sworn by the claimant to the best of the claimant’s knowledge, information and belief. The Lien Statement must include: (a) the name of the lien claimant; (b) the owner or reputed owner if known, if unknown a statement stating such; (c) a description of the lien claimant’s role (contractor, subcontractor, etc); (d) the name of the principal contractor, if known, if unknown a statement stating such; (e) the amount due and owing the claimant (be aware, if a Lien Statement is filed for a larger sum than is actually owed, the entire lien is invalid).
The Lien Statement must be recorded along with affidavits of service of the Notice and Lien Statement. Generally, you must record the Lien Statement within 4 months of ending your work (or delivering your materials). However, day laborers who only supplies labor to the job site have a 2-month deadline to record the Lien Statement.
- File a Lien Foreclosure Action: Your next step is filing a court action (a Complaint) to “foreclose” on the lien. A mechanic’s lien claimant must bring a foreclosure action within six months after one of three dates, whichever occurs last: (1) the date of the last work performed; (2) the date of the last materials furnished; or (3) the date of completion of the building or improvement.
“Completion of the construction project” usually means the date on which the Certificate of Occupancy was issued, or the date when all work was completed.
This is a summary of the key steps to file a mechanic’s lien in Colorado. Mechanic’s liens are however, complicated. Fairfield and Woods P.C.’s construction team has the expertise to handle the mechanic’s liens, the lawsuit, or otherwise help you get paid (from contract review to litigation). Fairfield and Woods P.C. files and defends mechanics liens, and represents construction professionals, homeowners, as well as banks (and other “interested parties”). Please reach out to Laura Martinez for additional information.