Full question:
The General Contractor has been paid in full for an addition to a home. A subcontractor has not been paid by the GC and has filed a mechanic's lien against the home owner. In NY State, is this legal?
- Category: Contractors
- Subcategory: Construction Liens
- Date:
- State: New York
Answer:
A subcontractor can file a mechanic's lien for unpaid work under New York law, even without a direct contract with the homeowner. However, their lien is limited to the amount still owed on the contract between the homeowner and the general contractor (GC). Since the homeowner has paid the GC in full, this payment serves as a defense against the subcontractor's lien.
The GC is required to hold payments in trust for subcontractors and material suppliers. Therefore, if the GC fails to pay the subcontractor, the subcontractor's recourse is against the GC for breach of trust, not the homeowner.
Relevant statute: N.Y. Lien Law § 4(1).
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.