As any condominium association that has had to deal with one knows, the mechanic’s lien is a powerful hammer to force payment to a contractor. Once it is filed in the land records, a lien often makes it impossible for condominium unit owners to sell or refinance, costs the condominium association time and money (in legal fees) to defend, and generally embroils the condominium association in much unwanted litigation.

The good news is that removing a mechanic’s lien can be easier than you might think. Filing a lien, especially on a large condominium association, is not an easy task. The contractor has to conduct a title search and bring down for each condominium unit. And the Virginia mechanic’s lien statute is full of traps for the unwary. Because the Virginia courts view mechanic’s liens as "purely a creature of statute" and "in derogation of the common law," the mechanic’s lien statute is strictly construed. That is, it must be followed meticulously, or the lien will be invalid. Thus, painstaking analysis is required to ensure that the lien complies with Title 43 of the Virginia Code.

As a result, mechanic’s lien claims can be very defensible. Aside from the critical timing issues, which affect all mechanic’s liens (they must be filed within 90 days, and may only include work done within 150 days, of completion of the work), there are certain property identity and allocation issues that are specific to condominiums.

Here are some important points to remember:

    *The lien must name the owners of the property sought to be charged.
    This is trickier than it seems. For a condominium, "owner" means the individual unit owners, not the association. So, a lien for work on common elements must be recorded against all of the individual condominium units, not against the association itself. Failing to name the unit owners invalidates the lien.

    *Unit owners must be given notice.
    The contractor must file a certification of mailing of the memorandum of lien on the property owner. Again, where a lien is filed only against the condominium association, the individual unit owners receive no formal notice. This can be fatal to perfection of the lien.

    *There must be notice to the world.
    Mechanic’s liens are filed in the land records to protect innocent third-party purchasers and lenders. If the property owner is not correctly identified, the lien cannot be properly indexed in the land records. This too can invalidate the lien, because it is not in the unit owner’s chain of title, and no one searching title could discover the lien.

    *The claim must be "apportioned" among the units.
    A lien for work on common elements must show the proportionate amount of the indebtedness attributable to each individual unit. Virginia Code § 55-79.83(D) provides that the percentage liability for common expenses is the units’ respective undivided interests in the common elements, if the condominium instruments so specify. Many condominium associations’ governing documents contain a "Common Element Interest Table" or the like, recorded in the land records. A "blanket lien" filed against a condominium, without apportionment in accordance with the percentages set forth in the common element interest table, is invalid. Likewise, a lien for work done on individual units must be apportioned, since the work adds disproportionate value to individual units. A blanket lien "overburdens" the other units if it is not apportioned.

    *The unit owners must be made parties to a suit to enforce the lien.
    Clearly, the unit owners have property interests that could be defeated or diminished by enforcement of the lien – their units can be foreclosed to satisfy the lien. Trustees and beneficiaries of deeds of trust also have property rights entitling them to due process (notice and an opportunity to challenge the lien). They are all necessary parties to a suit to enforce a mechanic’s lien against a condominium. The failure to name them as defendants in the suit to enforce (apart from the lien itself) can be fatal to the lien’s enforcement.

Because they interfere with the condominium associations’ and the unit owners’ property rights, mechanic’s liens must be dealt with seriously and removed from the land records. Obviously, negotiating a resolution with the contractor is probably the quickest and cheapest way of removing the lien. But if that can’t be accomplished, remember that there are many technical defenses available due to the stringent requirements of the Virginia mechanic’s lien statute.