Type: Law Bulletins
Date: 01/17/2018

Mechanics Liens: Don't Throw in the Kitchen Sink - Alternative Facts Won't Get the Job Done.

Contractors frustrated by an owner’s failure to pay in full are sometimes tempted to build a margin into a mechanics lien claim to mitigate costs of enforcement. The well informed contractor will resist this inclination or risk invalidating the claim altogether.

Illinois, Indiana and Ohio courts are consistent in holding that a mechanics lien claim may be rendered void where is it found to be materially false or misleading as to the amount due, or in other respects. The manner in which this is determined varies slightly from state to state, but generally speaking, innocent mistakes will be excused, while knowing misstatements will defeat the claim.[1]

The policy behind this rule is to protect honest lien claimants who make mistakes but not claimants who knowingly make false statements. When a contractor asserts a claim containing false statements, such as to the amount owed or the property that is subject to the lien, it will not be enforced because the effect of the claim is to give the appearance of a greater encumbrance on the property than that to which the claimant is entitled.

Examples of false statements that may invalidate claims for lien include simple exaggeration of the amount due; inclusion of non-lienable charges, such as damages for delay, administrative expenses or costs of financing; blanket liens on multiple parcels of land for sums due only on parcels where improvements were made; or recording multiple liens on the same parcel for contractor’s performance of the same work.

Illinois courts determine whether a false statement was knowingly (or intentionally) made by considering the content of lien claim itself and at least some other facts, such as contradictory documents or admissions. [2] Indiana courts put the burden on the contractor to show that no fraud was intended and the misstatement did not prevent the owner from asserting a valid defense.[3] Ohio courts appear to place the burden on the owner to demonstrate actual fraud on the part of the contractor, which includes not only that the claimant knowingly made false statements but made them with intent to mislead, and that the owner was injured as a result.[4]

Contractors preparing to enforce claims for mechanics liens must use caution to be accurate in their calculation of sums due for the work, taking care to account for and apply all payments and credits, avoiding inclusion of non-lienable charges and recording the lien only against property on which improvements have been constructed but for which the owner has not fully paid.

For questions or specific advice, please contact a member of Taft’s Construction practice.


[1] The Illinois Mechanics Lien Act specifically states that no lien shall be defeated as to the proper amount because of an error or overcharging on the part of the claimant unless it is shown that the error or overcharge is made with intent to defraud. 770 ILCS 60/7 (2010). See also Father & Sons Home Improvement II, Inc. v. Stuart, 2016 IL App (1st) 143666 (2016). In Indiana see Abbey Villas Development Corp. v. Site Contractors, Inc., 716 N.E.2d 91 (Ind. App. 1999), citing Drake Lumber Co. v. Paget Mortgage Co., 203 Or. 66 (1954). In Ohio see McClure v. Fischer, 145 Ohio Misc. 2d 38 (2007).  

[2] Father & Sons Home Improvement II, Inc. v. Stuart, 2016 IL App (1st) 143666 (2016).

[3] Abbey Villas Development Corp. v. Site Contractors, Inc., 716 N.E.2d 91 (Ind. App. 1999).

[4] McClure v. Fischer, 145 Ohio Misc. 2d 38 (2007).

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