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The question often arises whether there is right to a register a
construction lien against a landlord/owner's interest in
property with respect to a contract with a tenant to provide
improvements to its leased premises. In these situations, the
construction lien is usually only against the tenant's
leasehold interest in the property. The construction lien can be
enforced by selling the lease to satisfy the lien.
In order for a construction lien to also attach to the ownership
interest in the property (i.e. the landlord/owner's interest in
the property), the contractor must have provided the landlord/owner
with written notice of the improvement to be made. In order to
avoid liability and a successful lien claim against the ownership
of the property, the landlord/owner has 15 days after receiving
this notice from the contractor to give the contractor written
notice that the landlord/owner assumes no responsibility for the
improvement to be made to the property. If the landlord/owner
provides the written response that it is assuming no responsibility
for the improvement, the construction lien will only attach to the
tenant's leasehold interest in the property.
The only other situation in which a landlord/owner may be found
liable and a lien can be registered against the ownership of the
land is if the owner specifically requested that the lien claimant
do the work that is the subject of the construction lien.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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