By Scott Wolfe Jr
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TrackbacksPreviously on the Louisiana Construction Law Blog , and over at the Construction Lien Blog operated by our friends at Express Lien, it’s been mentioned that the lien statutes require attention to details. In Louisiana, like elsewhere in the country, lien filings must meet strict statutory requirements.
A case decided just last week in the Louisiana 3rd Circuit Court of Appeals repeats this principal, and illustrates the dangers of improper lien filings.
In Tee It Up Golf, Inc. v. Bayou State Construction, LLC, the court affirmed a trial court decision finding a Louisiana lien improperly recorded because:
- It didn’t have a legal property description
- It didn’t itemize the unpaid work or materials
- The general contractor didn’t record the notice of contract
The penalty for recording the lien improperly? The contractor was charged $3,000.00 for attorneys fees for losing at the trial level, and another $3,000.00 in attorneys fees for losing the appeal.
Property Descriptions
In this 3rd Circuit case, the contractor filed a lien listing the municipal address for the property, which was considered insufficient. The court pointed to La R.S. 9:4813(C) of the Private Works Act requiring:
Each filing….shall contain a description of the property sufficient to clearly and permanently identify the property. A description which includes the lot and/or square and/or subdivision or township and range shall meet the requirements of this Subsection. Naming the street or mailing address without more shall not be sufficient…
While a full “legal property description” may not always be required, the court here made clear – again – that the municpal address, without more, is insufficient.
Itemizing Work Performed and Materials Delivered
Next, the court held that the lien did not “reasonably itemize the elements” of the work and materials that gave rise to the filing.
How much itemization is required exactly? The 3rd Circuit didn’t answer that question (and to my knowledge, Louisiana courts have never made this abundantly clear). However, the 3rd circuit told us what wasn’t enough:
On [the lien]…the $180,762.59 figure is listed under the category “Materials Supplied.” There is no attempt whatsoever to itemize the elements comprising this amount as required by statute. Thus, the Statements of Claim filed by Bayou State were improper and the trial court did not err in ordering their cancellation.
Failure To File the Notice of Contract
General Contractors (those who contract with the owner) on projects with a contract price in excess of $25,000.00 must always record a notice of contract before the work begins. If this is not recorded, the general contractor forfeits its right to file a mechanics lien in Louisiana.
That’s a rule provided in the Private Works Act in §9:4811(D), which states:
[a] general contractor shall not enjoy the privilege granted by R.S. 9:4801 if the price of the work stipulated or reasonably estimated in his contract exceeds twenty-five thousand dollars unless a notice of contract is timely [before any work began] filedBayou Construction didn’t file the notice, and therefore, the lien was improper.
The court did make note of an exception to this rule argued by Bayou Construction, which allows a general contractor who did not file a notice of contract to file a laborer’s lien as a “non-general or ordinary contractor”. This was allowed in Burdette v. Drushell, 837 So.2d 54 (La App 1 Cir 2002).
In Burdette, the court explained as follows:
Even though plaintiff acted as ‘general contractor,’ he also occupied the status of an ordinary ‘contractor’ under La R.S. 9:4807(A) for his carpentry services and related labor and material costs. Thus, as such, he is entitled to the privilege….for ‘the price of his work.’ … The trial curt correctly concluded the plaintiff is entitled to claim a privilege for his own labor and that of his employees.
Bayou’s lien, however, wasn’t filed to simply recover the costs of its and its employee’s labor. It sought payment for the labor and materials provided by subcontractors, which meant the lien sought to claim a privilege for the work of the “general contractor,” and without a notice of contract it was not allowed. This, of course, in addition to the other lien defects.
This article was originally posted on Wolfe Law Group’s topic-specific Louisiana Construction Law Blog.
