If getting paid is a problem, and you don't mind angering a customer, filing a mechanic's lien can be a powerful remedy.
What is a mechanic's lien?
It is, quite simply, the right to sell the land, the place where your company did its work, to receive payment for what you are owed.
What does that give you?
Three things:
- A second pot of money to target—the value of the land—even if the landowner is not your customer. The first pot would be the bank account of the company that owes you.
- Often the right to get your legal fees reimbursed, although not usually the case in American courts.
- Serious leverage. Imagine the pressure exerted by a big company landowner on your customer if your customer is not the landowner.
How do you go about filing one?
You need to be quick about it—and there are lots of technicalities that must be satisfied to get these right. For instance, to acquire lien rights in some states a "notice of commencement" must be filed at the beginning of a project. Also, there is usually only a very brief window of time for filing a lien after work has been concluded. Finally, not every state recognizes the right of companies like those of SIs to file a lien. For all of these reasons, I do not recommend that any company file a lien without consulting a lawyer (and, believe me, I don't always say that). But once recorded, they often do the trick.
Mark Voigtmann is the CSIA’s attorney and leader of the automation practice at Faegre Baker & Daniels, a law firm with offices in the US, UK and China. He can be reached at 317.237.1265 or Mark.Voigtmann@faegrebd.com. Members of the CSIA are automatically members of the CSIA Legal Plan with a number of free and discounted offerings. See www.controlsys.org/membership/member-services/legal-plan
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