Are lost or damaged items lienable?
- The law allows a lien to attach to equipment and material incorporated into the final product
According to the lien laws, equipment and materials are meant to be installed in the project permanently. So if equipment is lost or damaged, it clearly means it has not been incorporated into the final product.
Although the lien law does allow for what is called normal wastage, lost material or damaged equipment doesn’t fall into that category. So, if you lien a project with lost or damaged material, you run the risk that someone can claim your lien is fraudulent.
A rental company rents out an excavator for an on-going project, and during the course of excavation, the bucket is broken requiring the rental company to provide a new bucket. Can the rental company lien the job for the damaged bucket? No.
And if a scaffold or shoring company delivers 1000 pieces of equipment and only 950 are returned, can the company lien for the value of the missing 50 pieces? No.
Lost and damaged equipment and materials are not lienable. Keep that in mind when you put together your lien. Know that you run the risk of having your lien found to be fraudulent if you include such items in your lien.