Colorado mechanics lien law – leased land or building
Our Colorado mechanics lien lawyers occasionally encounter a situation such as this.
C. DeVille hires general contractor Top Quality Construction to build a puppy day spa. DeVille does not own the land where the facility is to be located, but leases the land. The landowner is Swampland, LLC. May Top Quality lien Swampland’s land if C. DeVille does not pay for her fine new dog spa?
Answer, yes. It does not matter whether C. DeVille’s lease authorized her to build on the land. Top Quality improved the land, and is entitled to a lien on the land.
However, Colorado landlords are provided a procedure for the protection of their property interests against mechanic’s liens resulting from work done at the request of their tenants. This may be accomplished by Swampland giving written notice of non-liability. Swampland must post this notice within 5 days after learning that construction has commenced. Swampland may in the alternative serve the notice on all parties participating in construction. The notice must be posted in a conspicuous place, and remain posted throughout construction. It is Swampland’s burden to prove that it put Top Quality and its subs on notice. Some landowners take photos of their posted notices periodically during construction, to prove they were up.
Top Quality is not not denied all protection under these provisions. It does have the right to lien C. DeVille’s interest in the property, that is, her lease rights. Top Quality Construction might find itself opening a sister company, Top Quality Puppy Spa, where C. DeVille used to be.
What should Top Quality Construction do when its job gets posted by the owner? How can Top Quality Construction avoid taking on a job that will get posted by the owner? There are things you can do as preventative measures, and after posting. But each case is different. This is where mechanics lien lawyers are worth consulting.