Question

In: Operations Management

What is the primary function of a mechanics’ lien? A It is a claim against the...

What is the primary function of a mechanics’ lien?

A It is a claim against the owner

B It is a claim against a contractor

C It is security for a claim on a construction project

D It is security for the loan that finances the project

Solutions

Expert Solution

The primary function of a mechanics' lien is- it is security for a claim on a construction project.

As a mechanic's lien is a method used by those employed for the purpose of improving property to ensure that property owners will pay them for services and materials. If the property owner does not pay for the services or materials, the worker can initiate a court proceeding to force a sale of the property to pay for the services and materials.

Typically, the person employed to improve the property attaches a financial claim to the property they were hired to improve. The lien is like a "hold" on the property. Generally, the property owner will be served with a notice of a lien. The lien will be recorded at the county or city recorder's office so that it becomes attached to the title of the property. If the property owner does not pay, then the court will hold proceedings to sell the property for payment of the services.

A "mechanic" is commonly defined as someone who provides certain services, such as-

- Plumbing

- Painting

- Construction

- Carpentry

- Automotive Repair

- General contractor

- Subcontractor


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