As many contractors and lawyers know, filing a proper mechanic’s lien in Virginia is quite difficult. Virginia law provides that a mechanic’s lien must strictly comply with all of the provisions of the code. Because the lien recovery can circumvent typical limitations and allow parties to sue outside the contract chain, any technical failure in the lien filing can result in the entire lien being thrown out in court.
Over the last two sessions of the General Assembly, legislators in Richmond have tried to make an already difficult lien process even tougher. During the 2012 session, the General Assembly considered a bill that would have required contractors on all residential projects to transmit a written notice of intent to claim a lien 30 days before filing the lien memorandum in land records. Supposedly, a legislator upset about a lien filed on his own house project proposed the bill. While the bill initially passed the House by a 90-7 margin, it stalled in the Senate in 2012 and was continued to the 2013 session. Happily, the bill again stalled during the 2013 session, but it does demonstrate legislative aggressiveness against lien claims.
Unlike the first bill, another mechanic’s lien bill was actually enacted by the General Assembly. Effective July 1, 2013, a lien claimant must now include the claimant’s license number on a recorded memorandum of lien. Further, the bill included language expressly barring lien claims for work that is performed without a legal license where one is required.
The change in the law is clearly an effort to bar unlicensed contractors from not only filing suit, but also from asserting lien claims. Unfortunately, the change in the legal requirements and forms will catch a host of unsuspecting victims.
Contractors drafting their own liens, watch out. You need to update your forms and many will fail to do so. This will translate to a lot of avoidable failed lien claims. In the same vein, lawyers who fail to update their forms run the risk of having their clients’ lien claims blown out purely on a technical failure. This area of law is already one that is highly complex, and it just got a little bit harder.