ILLINOIS MECHANICS LIENS / COVID-19

Mechanics Liens

UPDATE: On 3/20/20, the Cook County Recorder of Deeds closed due to COVID-19. Its Press Release states: “Recording operations will cease until the Office re-opens…” but e-Filers “…can still submit e-recordings AND THOSE RECORDINGS WILL BE PLACED IN THE RECORDING QUEUE IN THE ORDER IN WHICH THEY ARE RECEIVED.” E-filed mechanics liens are thus being queued for eventual recording, but might not be “officially recorded” until some unknown date after e-filing.

Using Mechanics Liens to Get Paid: A Primer for Architects in the COVID-19 Era

The Illinois Mechanics Lien Act is a powerful tool that helps people get paid for design and construction. However, lien law is extraordinarily complex. If the content of a lien claim is not precisely accurate, the lien can have little value. Experienced attorneys can use minor typos to defeat lien claims. Jeremy prepares and records Mechanics Lien claims with great caution. He has successfully protected property owner and developer clients from dozens of liens with minor technical defects.

To make a lien claim, click here.
To defeat a lien claim, click here.

What is a Mechanics Lien?

A lien claim is an interest in property which can “attach” to the land and buildings were the project is located. Like mortgages, mechanics liens can be “foreclosed” through lawsuits. Often, it is unnecessary for lien claimants to file suit to get paid. This is because property owners, developers, and lenders all know that lien claimants who prevail on lien foreclosure lawsuits can force a “judicial sale” of the property. Proceeds from the judicial sale are used to pay off claims against the property. The act of recording a lien “secures” the claim for payment by attaching it to valuable property.

Why is the Illinois Mechanics Lien Act so Pro-Claimant?

Lien claimants who satisfy the Act’s requirements can “leapfrog” ahead of other claims against the property. Liens recorded later-in-time can often get “priority” in the sale proceeds over claims recorded earlier-in-time, like mortgages. Lenders make loans assuming the value of the property secures their loan. They dislike mechanics liens. No lender wants architects, engineers, or contractors to have the power to force a sale of the property. That imperils the value of their mortgages. Lenders often bring pressure on property owners and developers to settle, or bond over, lien claims.

Why Are Mechanics Liens So Complicated?

The Illinois Mechanics Lien Act imposes short deadlines. They must be timely met, and with exacting precision. The Lien Act is over a century old. Its archaic language can confuse even experienced judges and attorneys. The Act does not identify all the content which must be included in mechanics lien claims. To know the required content, drafters of valid mechanics lien claims must be steeped in decades of caselaw. Also, each project, property, and claimant are different. To draft a lien claim, attorneys must almost always hire a Title Company to prepare a “Tract Search” as a first step. They can take weeks, robbing lien claimants of time needed to record their liens. Drafting lien claims requires judgment and strategy – and should be done by lawyers who can anticipate likely defenses based on the unique characteristics of the project and property.

The Illinois Mechanics Lien Act Imposes Short Deadlines. COVID-19, and the closure of many Recorder of Deeds' Offices, makes it critical to act quickly to secure your lien rights.

The Illinois Mechanics Lien Act always imposes short deadlines. With COVID-19, and the closure of many Recorder of Deeds’ Offices, it is critical to act quickly to secure your lien rights.