Mechanic’s Liens in Arizona – Part 1
Thank you for visiting Elley Law PLC’s website. Here is Part One of an overview of Mechanic’s Liens in Arizona
On most non-residential (where a resident does not live in the home) construction projects, most anyone that provides services or materials may file a mechanic’s lien for the amount owed. There are set steps that need to be strictly followed or the right is lost.
Arizona law requires that every person (except for a person performing actual labor for wages) who furnishes labor, professional services, materials, machinery, fixtures or tools to a construction project, within 20 days of commencing work, provide written notice, called a preliminary twenty-day notice, of their statutory lien rights to the home owner, constructions lender, original contractor, and the person with whom the claimant has contracted.
The amount of time a claimant has to record the actual mechanic’s lien depends on whether the owner files a notice of completion of the project. Filing a notice of completion is optional for the owner of the property, but if it is filed, the period of time for which the claimant has to file a lien is 60 days from the recording of the notice of completion; otherwise, it is 120 days from the completion to file the lien.
Completion is defined, if a governmental permit final inspection is required, as the earliest of the following events: 1) 30 days after final inspection and written final acceptance by the governmental body that issued the permit, or 2) cessation of labor for 60 days. In the event no building permit is issued or if the governmental body that issued the permit does not issue a final inspection and acceptance, then the completion is the last day on which labor, materials, fixtures, or tools were furnished to the property.
Once a lien is recorded, the lienholder must judicially foreclose on the lien within 6 months of recording or it will no longer exist. An owner may discharge the lien by posting a bond 1.5 times the amount claimed and the lien holder then must proceed against the bond and obtain a judgment.