Home / Mechanics Liens and Lien Releases on a Painting Job

Protecting Your Home From Liens When You Pay a Painter

A painting job looks simple from the homeowner's side. You hire a contractor, the contractor paints, you pay the contractor. Behind that simple picture there may be other parties: the paint store that sold the materials on account, an equipment rental company that supplied scaffolding, a subcontractor who handled the cabinets. In California, those parties can have lien rights against your property if they are not paid, even when you have paid your contractor in full.

That sounds alarming, and on most jobs nothing goes wrong. Still, understanding how liens work and how to use lien releases is a practical way to make sure your payments actually clear the debt on the job.

What a mechanics lien is

A mechanics lien is a claim against real property, recorded by someone who provided labor, services, equipment or materials to improve that property and was not paid. California's constitution and statutes give these rights to contractors, subcontractors, laborers and suppliers. If a valid lien is recorded and not resolved, it can cloud the title and complicate a sale or refinance, and in some cases it can lead to a court action to enforce it.

For a painting job, the parties most likely to have lien rights besides your contractor are the paint supplier, any subcontractor, and any equipment rental company.

The preliminary notice

Parties who do not contract directly with you, such as suppliers and subcontractors, generally must send you a preliminary notice to preserve their lien rights. You may receive one early in the job. It is often called a 20-day notice.

Receiving a preliminary notice does not mean anything is wrong. Many suppliers send them routinely on every job. It does tell you something useful: this party is supplying your job and may have lien rights. Keep every notice you receive with your contract. These notices tell you from whom to request lien releases.

Subcontractors on painting jobs

Many painting contractors run their own crews, but some bring in subcontractors for particular parts of a job, such as cabinet refinishing, specialty finishes, drywall repair, or carpentry to replace damaged trim. A larger company may subcontract entire jobs to smaller crews. Each subcontractor who does not get paid by your contractor may have lien rights of their own. That is one more reason to ask at the estimate visit who will actually do the work. If subcontractors are involved, ask for their names and license numbers so you can check them, and expect that you may receive preliminary notices from them. Treat those notices the same way as a supplier's: keep them, and plan to collect releases from each sender as the job is paid.

Lien releases: the four statutory forms

California uses standard statutory forms for waiving and releasing lien rights. There are four types:

Conditional waiver and release on progress payment. Releases lien rights for a progress payment, but only once that payment actually clears.
Unconditional waiver and release on progress payment. Releases lien rights for a progress payment immediately and without conditions. It should only be signed once payment has been received.
Conditional waiver and release on final payment. Releases all lien rights for the job, conditioned on the final payment clearing.
Unconditional waiver and release on final payment. Releases all lien rights for the job unconditionally, after final payment has been received.

The conditional forms protect the party signing them, since the release only takes effect if they are actually paid. The unconditional forms protect you, since they confirm payment has been received and rights are released.

A practical sequence for homeowners

At signing, ask the contractor whether they plan to use subcontractors and which supplier they buy paint from.
Keep any preliminary notices you receive and add the senders to a simple list.
With each progress payment, ask the contractor for a conditional release in exchange for payment, then an unconditional release once the payment has cleared.
For parties who sent a preliminary notice, ask the contractor to provide their releases as well, or ask the contractor to show that those parties have been paid.
At the final payment, collect a conditional final release from the contractor and, once payment clears, an unconditional final release. Collect the same from any party who sent a notice.

Many small painting jobs will not involve preliminary notices from other parties, and on those the process mainly involves the contractor's own releases.

Joint checks

If a supplier has sent a preliminary notice and you want extra protection, one option is to pay with a joint check made out to both the contractor and the supplier for the amount of materials. Both must endorse it, which gives the supplier assurance of payment. Discuss this with the contractor in advance. Some contractors are comfortable with it and some find it cumbersome, but it is a recognized practice.

What to watch for

A release that does not follow the statutory form, or one with changes to the wording, may not be valid. Stick to the standard forms.
Do not accept an unconditional release before the payment has been received and cleared by the person signing it, since signing one early would harm them, and a careful contractor will refuse.
Check that the name on each release matches the party that sent the preliminary notice.
Keep every release with the contract, change orders and payment receipts.

If a lien is recorded

If a lien is recorded against your property, do not ignore it. Contact the contractor first, since the underlying problem is usually an unpaid bill between the contractor and the supplier or subcontractor. Keep a record of what you paid and when. Depending on the situation, you may need legal advice on options for removing the lien. Having your lien releases, payment records and preliminary notices organized will make that process much easier.

Keeping it proportionate

For most painting projects, a licensed contractor with established supplier accounts pays their bills and no lien ever appears. Lien releases are simply a routine way of confirming that, like getting a receipt. A contractor who handles them without fuss is showing you a well-run business. A contractor who reacts badly to a request for a release is telling you something worth knowing before you pay the rest of the contract price.