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Can You File a Lien on Lease Property?

December 20, 2017

When one works on leased property, they may only they be able to lien the leasehold interest in some circumstances. The mechanic’s lien law, F.S. 713.10, allows a landlord to protect his property from liens from lessee’s construction by following a two-step process: One, having a provision in his lease which prohibits liens from attaching; and Two, recording that lease in the county where the property is located. This puts all interested parties on “notice” and protects the property from liens unless the improvement constitutes the “pith” of the lease. Thus, even though a lessor follows the steps above, his property may still be subject to a lien if the improvements are considered the “pith” of the lease. In such cases in Broward County, it is advisable to retain a Fort Lauderdale lien lawyer to fight on your behalf. When considering an attorney, always choose someone who also specializes in resolving legal matters between landlords and tenants – also known as lease disputes.

Determining Factors in Broward Courts

There is no clear definition of when the construction is the “pith” of the lease; however, there are a number of factors. If the construction is an integral part of the lease, where the lease requires the construction, then this may make it the pith of the lease. If it is obvious that the lease would not have been entered into without the improvements contemplated, this may subject the property to liens. Another factor is the character of the property. When the lease refers to improvements to be made and the property is vacant or partially improved and not suitable for its intended use, this may make it subject to liens. The lessors conduct is also important if the lessor is actively involved in the construction process, his lien prohibition in the lease may be deemed a fraud on lienors and make the owners interest liable. The fact that the lessor knows or approves of the construction is not enough by itself, even if the lessor approves construction plans. These are just several of the factors considered by the courts.

If one can not lien the owners interest, what can one lien? The answer is the leasehold interest. This is not much security, especially if the tenant defaults on the lease. The point is that one must know who all the parties are, not just whether one’s client is reputable. If one is going to work on leased property which is properly protected or seems to be, try to get a personal guarantee from one’s client or the general contractor. This is a very complex area of the law, as such it would be advisable to consult with your Broward Mechanic’s lien attorney prior to working on a big job which is leased and where the lessor is not the party who contracted for the improvements in Fort Lauderdale or Hollywood.