REAL ESTATE LAW
Illinois General Contractor Mechanic's Lien Attorneys.
In Illinois, general contractors who provide labor or supply materials to the improvement of real property are entitled to lien rights under the Illinois Mechanic’s Lien Act. General contractors include almost every party who contracts directly with the owner of the property, including but not limited to, architects, engineers, construction managers, laborers, etc.
In order for a general contractor to enjoy the rights afforded under the Illinois Mechanic’s Lien Act, the general contractor must record its claim for lien with the Recorder of Deeds in the county where the property is located within the time period specified. The mechanic’s lien does not need to include a legal property description, but Illinois law requires a “sufficiently correct description of the lot, lots or tracts of land to identify the same.” The mechanic’s lien also must be notarized to be valid.
Once the claim for lien is recorded properly, then the general contractor’s right to payment is superior to all other liens filed thereafter, with some exceptions. However, absent a mechanic's lien, a general contractor is limited to a breach of contract action or unjust enrichment claim against the property owner.
General Contractor Deadlines for Recording & Enforcing Mechanic’s Liens in Illinois
General contractors are not required to serve the owner or the owner’s lender with notice prior to filing a claim for lien. However, in order for the mechanic’s lien to be valid, a general contractor must record its claim for lien within four months of the last day of providing labor or materials for the property. A general contractor who performed work or supplied materials to an owner-occupied single-family residence must give the owner written notice within 10 days of recording a lien on the property.
If the general contractor fails to record its claim for lien within the four-month period, it may still enforce its lien claim against the property owner, but with less protection than if the lien was recorded timely. As a result, the lien claim would not take priority over other parties with an interest in the property, such as lenders and other lien claimants.
In addition, the general contractor must file a lawsuit suit to enforce the mechanic’s lien within two years of the last day of supplying labor or materials to the property or else the lien is deemed null and void.
Process for General Contractor to Enforce Mechanic’s Liens
The process for general contractors who provide labor or supply materials to the improvement of real property to collect money owed varies based upon the situation. However, generally, it is a good idea to record the claim of lien to preserve the general contractor’s rights under the Illinois Mechanic’s Lien Act.
Then the general contractor could either send a demand letter or file suit (after serving the 10 day notice). One reason why a general contractor would choose to demand payment prior to filing a lawsuit is to save the fees associated with filing suit. Of course, if the claim for lien is filed properly, then the general contractor could also choose to file a lawsuit and request the court to award the costs and attorneys’ fees associated with bringing the action in court.
It is important to note a lien claimant who has received payment must file a cancellation of the lien within 10 days after receipt of a written demand from the owner or any person with an interest in the property.
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