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1 / 60
What is the main effect of recording the notice of pendency (lis pendens) with the foreclosure suit?
Section 8461 provides that only from the time the notice of pendency is recorded is a purchaser or encumbrancer deemed to have constructive notice of the pending foreclosure action.
Source: CA Civil Code §8461
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The amount of a California design professional's lien is limited to:
Civil Code §8302 sets the lien at the design professional's contract fee or the reasonable value of the services, whichever is less, reduced by the amount of any deposit or prior payment under the contract.
Source: Civil Code §8302
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If a genuine good-faith dispute exists over a private-works progress payment, how much may the owner withhold from the direct contractor without triggering the prompt-payment penalty?
Civil Code 8800(b): if there is a good faith dispute over a progress payment, the owner may withhold an amount not in excess of 150 percent of the disputed amount. The rest must still be paid on time.
Source: Civil Code §8800
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A claimant who WILLFULLY includes in the lien claim labor or materials that were never actually furnished to the property:
Civil Code 8422(c): any person who willfully includes in a claim of lien labor, services, equipment, or materials not furnished for the property described shall thereby forfeit the person's lien. Honest errors are treated differently under 8422(a).
Source: CA Civil Code §8422
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Under Civil Code 8180, when no notice of cessation is recorded and the owner has not occupied the project, completion of a work of improvement occurs upon cessation of labor for a continuous period of:
Civil Code 8180 says completion of a work of improvement occurs upon, among other events, cessation of labor for a continuous period of 60 days, or recordation of a notice of cessation after cessation of labor for a continuous period of 30 days.
Source: CIV 8180
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If no foreclosure lawsuit is filed within that period, the lien:
Without a timely foreclosure action, the lien expires and becomes unenforceable.
Source: CA Civil Code §8460
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The 20-day period for serving a preliminary notice is measured from the date the claimant:
Civil Code 8204(a) runs the 20-day clock from when the claimant first furnishes work on the work of improvement, not from contract signing or completion.
Source: Civil Code 8204(a)
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A supplier has already received and cleared a progress payment, and the general contractor asks for a release covering that amount. The correct statutory form is the:
When a progress payment has already been received and cleared (and it is not the final payment), the matching form is the §8134 unconditional waiver and release on progress payment.
Source: Civil Code §8134
9 / 60
To free property from a recorded mechanics lien, the owner may record a lien release bond of ___ of the claim:
Civil Code 8424: the property can be released from a claim of lien by recording a lien release bond in an amount equal to 125 percent of the claim of lien, or 125 percent of the amount allocated to the property being released.
Source: Civil Code §8424
10 / 60
Besides the price estimate and work description, a preliminary notice must identify the jobsite by:
Civil Code 8102(a)(4), incorporated into the preliminary notice by 8202(a), requires a description of the site sufficient for identification, including the street address of the site, if any.
Source: Civil Code 8102(a)(4)
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For priority purposes, the mechanics lien is said to 'relate back' to which date?
Civil Code 8450(a): a mechanics lien has priority over any lien, mortgage, deed of trust, or other encumbrance that attaches after commencement of the work of improvement, so priority is measured from commencement, not from when the lien is recorded.
Source: CA Civil Code §8450
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A recorded construction deed of trust is generally SUBORDINATE to (junior to) mechanics liens if the deed of trust attached after which event?
Under §8450(a), a mechanics lien has priority over any encumbrance that attaches after commencement of the work of improvement (or was unrecorded at commencement and of which the claimant had no notice).
Source: CA Civil Code §8450
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A 'Notice of Cessation' may be recorded after work has stopped continuously for:
A Notice of Cessation may be recorded after labor has continuously ceased for at least 30 days.
Source: Civil Code §8188
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The surety bond accompanying a bonded stop payment notice is conditioned so that, if the claimant does not prevail, it will pay the costs and damages awarded to:
Section 8532 requires the 125% bond to be conditioned that, if the defendant recovers judgment, the claimant will pay costs and, up to the bond amount, damages to the owner, direct contractor, or construction lender.
Source: Civil Code §8532
15 / 60
An electrical subcontractor serves its preliminary notice and also files a copy with the county recorder. Under Civil Code 8214, the benefit of filing is that the county recorder will:
Civil Code 8214 says that upon accepting a notice of completion or notice of cessation for recording, the county recorder shall mail notification to those persons who have filed a preliminary notice that such a notice has been recorded on the property.
Source: CIV 8214
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The penalty for wrongfully withholding a construction payment under California's contractor prompt-payment statutes (B&P §7108.5 and Public Contract Code §7107) is:
BPC 7108.5(b): a violation subjects the licensee to a penalty, payable to the subcontractor, of 2 percent of the amount due per month for every month that payment is not made.
Source: B&P §7108.5 / Public Contract Code §7107
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If a claimant records a mechanics lien but never files a lawsuit to foreclose it within the required time, the property owner may:
Section 8480 lets an owner petition the court for an order releasing the property from the lien if the claimant has not commenced an enforcement action within the time provided in §8460.
Source: CA Civil Code §8480
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A construction lender that receives an UNBONDED stop payment notice from a claimant:
Civil Code 8536(b)(1): the construction lender may, at its option, elect not to withhold funds when the stop payment notice is unbonded.
Source: Civil Code §8536
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In an action to recover a wrongfully withheld payment, the prevailing party may recover:
In an action for wrongfully withheld payment, the prevailing party may recover attorney's fees and costs.
Source: B&P §7108.5 / Public Contract Code §7107
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To preserve a payment bond claim, a claimant who was required to give it must still serve:
Civil Code 9560(a): to enforce a claim against a payment bond, a claimant shall give the preliminary notice provided in Chapter 3 (commencing with Section 9300), unless the claimant is exempt, such as a laborer.
Source: Civil Code §9560
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An 'unconditional' waiver and release becomes effective:
Civil Code 8134, required notice on the unconditional form: this document is enforceable against you if you sign it, even if you have not been paid. If you have not been paid, use a conditional waiver and release form.
Source: Civil Code §8134 / §8138
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A public works payment bond must be in an amount of at least:
Civil Code 9554(a): a payment bond shall be in an amount not less than 100 percent of the total amount payable pursuant to the public works contract.
Source: Civil Code §9554
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The California design professional's lien (Civil Code 8300 et seq.) is available to which of the following, provided there is a written contract with the landowner?
Civil Code §8300 limits the design professional's lien to a 'design professional' as defined in §8014 — a licensed architect, landscape architect, registered professional engineer, or licensed land surveyor — who contracted in writing with the landowner.
Source: Civil Code §8300 (defining 'design professional' via §8014)
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A BONDED stop payment notice (to force a construction lender to withhold) requires a surety bond equal to:
Civil Code 8532: a claimant may give a construction lender a stop payment notice accompanied by a bond in an amount equal to 125 percent of the amount of the claim.
Source: Civil Code §8532
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A general contractor who holds a direct contract with the owner is required to give a preliminary notice to whom?
Civil Code 8200(e)(2) provides that a claimant in a direct contractual relationship with the owner need give preliminary notice only to the construction lender, if any.
Source: Civil Code 8200(e)(2)
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After filing the lawsuit to foreclose a mechanics lien, the claimant must record a notice of pendency of action (lis pendens) within:
Section 8461 requires the plaintiff to record a notice of pendency of the action on or before 20 days after commencement of the enforcement action.
Source: CA Civil Code §8461
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Under the "Exceptions" heading of the Civil Code 8132 conditional waiver and release on progress payment, the form leaves untouched the claimant's rights to:
Civil Code 8132 form, Exceptions: the document does not affect retentions, extras for which the claimant has not received payment, or earlier progress payments covered by a conditional waiver but not yet paid.
Source: Civil Code §8132
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When an owner wrongfully withholds a private-works progress payment from the direct contractor, the statutory penalty (in place of ordinary interest) is:
Civil Code 8800(c): an owner that violates the section is liable to the direct contractor for a penalty of 2 percent per month on the amount wrongfully withheld, in place of any interest otherwise due, and the prevailing party in a collection action is entitled to costs and a reasonable attorney's fee.
Source: Civil Code §8800
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A claimant who serves a stop payment notice on the construction lender (rather than the owner) attaches a surety bond mainly because:
Civil Code 8536(b)(1) lets a construction lender elect not to withhold funds when the stop payment notice is unbonded, and 8532 sets the bond at 125 percent of the claim. The bond is what takes away the lender's option not to withhold.
Source: Civil Code §8532 / §8536
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After recording a mechanics lien, the claimant must file a lawsuit to FORECLOSE it within:
A foreclosure action must be filed within 90 days after recording the claim of lien.
Source: CA Civil Code §8460
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When there is a good-faith dispute over payment, the payer may withhold up to:
BPC 7108.5(a): if there is a good faith dispute over the amount due on a progress payment, the prime contractor or subcontractor may withhold no more than 150 percent of the disputed amount.
Source: B&P §7108.5 / Public Contract Code §7107
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Which item must a preliminary notice contain?
Civil Code 8202(a)(2) requires the notice to include an estimate of the total price of the work provided and to be provided (in addition to the general description of the work).
Source: Civil Code 8202(a)(2)
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On public works, the prime contractor must pay a subcontractor within ___ of receiving payment:
BPC 7108.5(a): a prime contractor or subcontractor shall pay any subcontractor not later than seven days after receipt of each progress payment, unless otherwise agreed in writing.
Source: B&P §7108.5
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On public works, retention must generally be released within ___ after completion:
The public entity generally must release retention within 60 days after completion.
Source: Public Contract Code §7107(c)
35 / 60
A 'mechanics lien' is:
A mechanics lien is a legal claim against the improved real property to secure payment for labor/materials.
Source: CA mechanics lien law (Civil Code §8000+)
36 / 60
Before a design professional may record a design professional's lien on the site, what must have been obtained in connection with the design services?
Civil Code §8302 bars recording a design professional's lien unless a building permit or other governmental approval in furtherance of the work of improvement has been obtained; the lien attaches even though construction has not commenced.
Source: Civil Code §8302
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For all the work a supplier furnishes to a single work of improvement under one contract, how many preliminary notices must it give to each required recipient?
Civil Code 8206(a) provides that a claimant need give only one preliminary notice to each required person covering all work provided for the improvement.
Source: Civil Code 8206(a)
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You are requesting a progress payment that you have yet to receive. The statutory waiver form to sign is the:
Civil Code 8132: when a claimant must sign a waiver to induce a progress payment and has not in fact been paid, the form to use is the conditional waiver and release on progress payment, which is effective on receipt of payment.
Source: Civil Code §8132
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You should sign an UNCONDITIONAL waiver:
Civil Code 8134, required notice on the unconditional form: it is enforceable against you if you sign it, even if you have not been paid. If you have not been paid, use a conditional waiver and release form.
Source: Civil Code §8134 / §8138
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A recorded mechanics lien must state:
A recorded lien claim must state the amount due after deducting all just credits and offsets.
Source: Civil Code §8416
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The preliminary notice must be served on:
Civil Code § 8200(a) requires the preliminary notice to go to three parties: the owner or reputed owner, the direct (prime) contractor, and the construction lender, if there is one. Miss a required recipient and the lien claim fails on a technicality before anyone reaches the merits of who owes what. One carve-out worth knowing: under § 8200(e), a claimant who holds a direct contract with the owner — the prime contractor — only has to serve the construction lender, since the owner already knows exactly who is on the job.
Source: CA Civil Code §8200
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Under Civil Code 8132, a required waiver and release on an unpaid progress payment that departs from the statutory form is:
Civil Code 8132: if a claimant must sign a waiver and release to induce a progress payment and is not in fact paid, the waiver and release is null, void, and unenforceable unless it is in substantially the statutory conditional form.
Source: Civil Code §8130 et seq.
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If the owner records a Notice of Completion, a DIRECT (prime) contractor must record within:
Civil Code 8412: a direct contractor must record a claim of lien before the earlier of ninety days after completion, or sixty days after the owner records a notice of completion or cessation.
Source: CA Civil Code §8412
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A 'conditional' waiver and release becomes effective:
Civil Code 8132, required notice on the conditional form: this document waives the claimant's lien, stop payment notice, and payment bond rights effective on receipt of payment.
Source: Civil Code §8132 / §8136
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A subcontractor is handed the final payment check at closing, but it has not yet cleared the bank. Before releasing its rights, the sub should sign a:
Because this is the last payment and the check has not cleared, the correct statutory form is the §8136 conditional waiver and release on final payment, which becomes effective only on actual receipt of payment.
Source: Civil Code §8136
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A stop payment notice is a claim against:
Civil Code 8500 governs rights with respect to any fund for payment of construction costs, and under 8522 an owner who receives a stop payment notice withholds from the direct contractor a sufficient amount to pay the claim. A mechanics lien, by contrast, attaches to the real property.
Source: Civil Code §8500 et seq.
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A material supplier who sells to a subcontractor (not directly to the owner):
Civil Code 8400 gives a material supplier a lien right, and Civil Code 8200 requires a claimant to give preliminary notice to the owner, the direct contractor, and any construction lender before recording a lien claim.
Source: Civil Code §8200 / §8400
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For a claimant required to give it, compliance with the preliminary-notice requirement is:
Civil Code 8200(c) states that compliance with the section is a necessary prerequisite to the validity of a lien claim or stop payment notice.
Source: Civil Code 8200(c)
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To serve a stop payment notice, a claimant who was required to give it must generally have first served:
A claimant required to give preliminary notice must do so before a valid stop payment notice (same as for lien rights).
Source: Civil Code §8200 / §8508
50 / 60
In a lawsuit to collect a private-works payment that was wrongfully withheld, what may the prevailing party recover in addition to the amount owed?
Civil Code 8800(c): in an action for collection of the amount wrongfully withheld, the prevailing party is entitled to costs and a reasonable attorney's fee, on top of the 2 percent per month penalty on the amount wrongfully withheld.
Source: Civil Code §8800
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On a private project, once a direct contractor receives a progress payment, within how many days must it pay a subcontractor the portion due for that subcontractor's completed work?
BPC 7108.5(a): a prime contractor or subcontractor shall pay any subcontractor not later than seven days after receipt of each progress payment, unless otherwise agreed in writing.
Source: Business & Professions Code §7108.5
52 / 60
An honest, innocent error in the amount or details stated in a recorded lien claim:
Section 8422(a) provides that erroneous information in a claim of lien does not invalidate it unless the court finds the claim was made with intent to defraud (or an innocent bona fide purchaser was misled).
Source: CA Civil Code §8422
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To preserve lien rights, a subcontractor or supplier must serve a 'preliminary notice' within ___ of first furnishing labor or materials:
Civil Code § 8204(a) sets the clock: a preliminary notice must be given no later than 20 days after the claimant first furnishes labor, materials, services, or equipment to the job. Blowing that window does not destroy your lien rights — you can still serve late — but § 8204(a) then limits you to work performed in the 20 days before you served the notice, plus everything you furnish after that. Anything earlier is unsecured, and on a long job that can be most of your money. Note the split: § 8200 tells you who must receive the notice; § 8204 is the deadline.
Source: CA Civil Code §8200
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An unpaid architect or engineer who provided design services under a written contract with the landowner may record a claim of lien as a:
Civil Code 8300 and 8302: a design professional provides design, engineering, or planning services under a written contract with a landowner, and from recording a claim of lien has a lien on the site even if the planned work has not begun.
Source: Civil Code §8300–§8302
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On a private job, a subcontractor's preliminary notice must be served on which parties?
Civil Code 8200(a) requires the claimant to serve the owner or reputed owner, the direct contractor, and the construction lender or reputed construction lender, if any.
Source: Civil Code 8200(a)
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If the owner records a Notice of Completion, a SUBCONTRACTOR must record its lien within:
Civil Code 8414: a claimant other than a direct contractor must record a claim of lien before the earlier of ninety days after completion, or thirty days after the owner records a notice of completion or cessation.
Source: CA Civil Code §8414
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The four statutory waiver forms are conditional and unconditional, each for:
The four forms are conditional/unconditional waivers for progress payments and for final payments.
Source: Civil Code §8132–§8138
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Under Civil Code 8200(e), which party on a private work of improvement is exempt from giving a preliminary notice?
Civil Code 8200(e)(1): a laborer is not required to give preliminary notice. Material suppliers, lower-tier subcontractors, and equipment lessors are not exempt.
Source: Civil Code 8200(e)(1)
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A mechanics lien attaches to:
Civil Code 8440: a lien attaches to the work of improvement and to the real property on which it is situated, including as much space about it as is required for its convenient use and occupation. That is why a lien clouds the title.
Source: Civil Code §8400
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On a private work of improvement, an owner who has held back retention must release it to the direct contractor within how long after completion of the work?
Civil Code §8812(a) requires the owner to pay withheld retention to the direct contractor within 45 days after completion of the work of improvement.