If you’re involved in building or renovating commercial property, understanding commercial construction liens in New Jersey is essential. These liens act as a powerful tool for contractors, subcontractors, and vendors who have not been paid for the work or materials they provided. Navigating the rules around these liens can be tricky, so let’s break down the basics in a clear and straightforward way.
What Is a Commercial Construction Lien?
A construction lien gives those who performed work or supplied materials on a commercial property a legal interest in that property. If a contractor hasn’t been paid, they can file a lien to ensure they get compensated—often by allowing payment from the property’s sale proceeds. This means property owners can’t easily sell or refinance the property without addressing any outstanding liens.
Who Can File a Lien?
In New Jersey, a variety of trades can file liens—including plumbers, electricians, masons, roofers, HVAC specialists, and landscapers—so long as they’ve performed work or supplied goods under a written contract. Even change orders must be documented in writing to support a valid lien.
Important Rules and Deadlines
One critical rule is timing: a construction lien on commercial property must be filed within 90 days of the last day work was done or materials supplied. Unlike residential projects, filing a Notice of Unpaid Balance with the county is not required for commercial liens. However, if you want to enforce the lien, you must file a lawsuit within one year of that date—the property owner can even demand you file suit within 30 days after notice.
Limits and Protections
The lien amount can’t exceed the amount the property owner owes the general contractor, known as the “lien fund.” For example, if a subcontractor isn’t fully paid by the general contractor, the construction lien can only cover amounts unpaid by the owner, not the full subcontractor’s claim. This protects owners from inflated or improper lien claims but still helps ensure contractors get paid fairly.
Understanding commercial construction liens in New Jersey can save you stress and money down the road. Whether you’re a contractor, subcontractor, or property owner with questions about the lien process, consulting a knowledgeable attorney can help you navigate these complex rules and protect your rights.
If you need help with a commercial construction lien issue, contact Redemption, LLC to get the guidance you deserve.