In Utah, to lien, you must do more than clean. Restoration contractors often do more than clean up when disaster strikes a home or business. When a restoration contractor physically improves the structure, there may be a basis for a lien against the property.
In the Utah Court of Appeals’ decision in All Clean, Inc. v. Timberline Properties, the court ruled that a flood mitigation company’s work on a specific project did not qualify as the basis for a mechanic’s lien where the company’s work was limited to “extracting the water, padding the furniture to prevent additional damage, drying the premises, cleaning and deodorizing the carpers, and applying a microbial agent to prevent mold.” 2011 UT App 370, ¶ 2, 264 P.3d 244. The court identified “physical annexation and physical alteration of relative substance and durability as the central characteristics of lienable work[.]” Id. at ¶ 15.
Accordingly, while most aspects of the mitigation component of restoration work are not lienable, much of the rebuild component could be lienable. Extracting standing water is not lienable but replacing the pipe that caused the leak would be because plumbing is physically attached to the structure and is intended to stay in place for an extended period of time. Similarly, cleaning and drying carpet would not be lienable but installing new flooring could be lienable. Other lienable work may include installing new base boards, electrical work, framing new entryways or walls, reinforcing walls, or installing shelving.
Determining what work may be lienable is not always easy especially when the law included in All Clean has not been developed by Utah courts. If you are a restoration contractor considering whether to record a mechanic’s lien against a property, it is best to consult with an attorney to provide advice on what portions of your invoice are lienable and to ensure that you have met the statutory prerequisites before moving forward.
Our office would be happy to provide legal counsel on these issues and any other issues you may be experiencing in your business.