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Can we release escrowed funds tied to an invalid lien from an unlicensed contractor?

Can we release escrowed funds tied to an invalid lien from an unlicensed contractor?

Q: Can someone put a lien on my house without a contract?

Generally, a lien cannot be placed on your house without a legal basis, such as a contract or a court judgment. However, certain types of liens, like tax liens, can be imposed without a contract. If you believe a lien has been improperly placed on your property, you may need to challenge it in court.

Q: Can a lien be placed on a house in trust?

Yes, a lien can be placed on a house that is in a trust. The property is still considered an asset that can be subject to claims if the trust's beneficiary has outstanding debts or obligations. Legal advice may be necessary to navigate the implications of liens on trust property.

Q: What would happen if you bought a house and later found out that there were unpaid liens against the property?

If you discover unpaid liens after purchasing a house, those liens may still attach to the property, potentially affecting your ownership. You might be responsible for settling these liens to clear the title. It's advisable to consult with a real estate attorney to understand your options and obligations.

Q: What must occur to enforce a lien in Utah?

To enforce a lien in Utah, the lien claimant must typically file a lawsuit to foreclose the lien. This involves providing evidence of the debt and the lien's validity. If the court finds in favor of the claimant, it may order the property to be sold to satisfy the debt. Legal guidance is recommended to navigate this process.

Full question:

A contractor who is not licensed, filed a lien on property we (a trust) received back after we had sold the property on a land contract. The property was sold again, but the title co. to get the lien off put money in escrow. Now the money is tied up and this contractor who was hired by the owner of the land contract wants money. Is there an easy way to release this money being held, since the original lien was not valid? Do we have to file a lawsuit in order to release this money? I think this contractor is very shady. He is not licensed in Michigan, plus he says he wants to meet with us to talk, tells us we owe him $10,000 but fails to give us an invoice (the former owner says he was paid for the work he did) but continues to have secret meetings with this contractor. It appears they may be trying to work against us. I feel there must be a way to get this settled quickly. Please Advise.

Category: Contractors
Subcategory: Construction Liens
Date: 04/07/2025
State: Michigan

Answer:

In Michigan, a lien remains on property until it is properly released. If a lien claimant has been paid, they must prepare and deliver a release of the lien upon demand. If they fail to do so, the property owner can file a lawsuit to compel the release. The court may award costs and attorney fees if it finds the delay unjustified.

If you believe the lien is invalid, you can file a motion in court to challenge it. This motion should state your reasons for believing the lien is frivolous and should be supported by an affidavit. The court will schedule a hearing, and if the lien claimant fails to appear, the lien may be released with prejudice, and they could be ordered to pay your costs, including attorney fees.

In summary, you may need to file a lawsuit to release the escrowed funds if the lien is found to be invalid. Additionally, you can pursue a frivolous claim action if you believe the lien was filed without reasonable cause. (MCL 570.1101 et seq.)

This content is for informational purposes only and is not legal advice. Legal statutes mentioned reflect the law at the time the content was written and may no longer be current. Always verify the latest version of the law before relying on it.

FAQs

Can a lien be put on a house that is in a trust?

Yes, a lien can be placed on a house that is held in a trust. The property within the trust is still subject to liens if the trust owner owes a debt or has not fulfilled a contractual obligation. However, the process may vary depending on the specific terms of the trust and state laws. It's important to consult with a legal professional to understand the implications and procedures involved.

Can someone put a lien on my house without a contract?

Can a lien be placed on a house in trust?

What would happen if you bought a house and later found out that there were unpaid liens against the property?

What must occur to enforce a lien in Utah?

What are the disadvantages of putting your house in a trust?

Some disadvantages of putting your house in a trust include potential loss of control over the property, ongoing administrative costs, and complexity in managing the trust. Additionally, if the trust is not set up correctly, it may not protect the property from creditors or liens. Consulting with a legal professional can help clarify these issues.