{"id":903643,"date":"2024-11-27T14:07:13","date_gmt":"2024-11-27T21:07:13","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=903643"},"modified":"2024-11-27T14:07:16","modified_gmt":"2024-11-27T21:07:16","slug":"mechanics-lien-rights-uncommon-issues-for-condominium","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/mechanics-lien-rights-uncommon-issues-for-condominium\/","title":{"rendered":"Who Owns it Anyway? The Uncommon Issues Unique to Mechanic\u2019s Liens For Common Elements of a Condominium"},"content":{"rendered":"\n<p>Ciaran Kelly | <a href=\"https:\/\/www.frantzward.com\/news-blog\/november-2024\/who-owns-it-anyway-the-uncommon-issues-unique-to\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Frantz Ward<\/a><\/p>\n\n\n\n<p>Contractors, subcontractors, laborers, and material suppliers who perform work or labor upon or furnish materials in furtherance of any improvement undertaken by virtue of a contract with an owner, part owner, or lessee have <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/mechanics-lien-law-complex-landscape\/\">mechanic\u2019s lien rights<\/a> to secure payment in full for their completed work.<sup>[1]<\/sup>\u00a0Ohio\u2019s lien law provides that a given owner\u2019s, part owner\u2019s, or lessee\u2019s interests include all ownership interests, either legal or equitable, which such person may have in the real estate upon which the improvements are made.<sup>[2]<\/sup>\u00a0Ohio\u2019s condo statute also explicitly grants lien rights against the entire condo property to anyone who performs work on the common elements of a condominium.<sup>[3]<\/sup><\/p>\n\n\n\n<p><strong>Mechanic\u2019s Lien Basics<\/strong><br>To properly exercise one\u2019s mechanic\u2019s lien rights, Ohio law requires, among other things, the claimant: (1) record an affidavit, within 60 days after the last date of performing work, labor or furnishing materials on the improvement for residential property (75 days for commercial); and (2) serve a copy of the recorded affidavit on the owner, part owner, or lessee of the improved property, or his designee, within 30 days after recording.<sup>[4]<\/sup>&nbsp;How to comply with these standard requirements is not clear when the lien is for an improvement to common elements of a condominium \u2013 namely, who is the owner?&nbsp;<\/p>\n\n\n\n<p><strong>Condo Law \u2013 Common Elements<\/strong><br>Ohio\u2019s Condominium Property statute provides that the common elements of a condominium property are owned by the unit owners as tenants in common, and the ownership shall remain undivided.<sup>[5]<\/sup>&nbsp;It further states that unless otherwise addressed in a condominium\u2019s declaration, damage to or destruction of all or any part of the common elements of a condominium property shall be promptly repaired and restored by the board of directors of the unit owners association.<sup>[6]<\/sup><\/p>\n\n\n\n<p>The conflict between these provisions creates an issue unique to a claimant exercising its mechanic\u2019s lien rights for an improvement to a condominium\u2019s common elements.&nbsp;&nbsp;A mechanic\u2019s lien claimant will likely have contracted with a unit owners association for an improvement to common elements of a condominium.&nbsp;&nbsp;The association arguably owns an equitable interest in the common elements.&nbsp;&nbsp;However, all unit owners of a condominium own an undivided legal interest in the common elements and the improvement thereon.&nbsp;&nbsp;This distinction creates uncertainty if the unit owners association is an owner or part owner under Ohio\u2019s lien law.&nbsp;&nbsp;In the time since both Ohio\u2019s condo and lien law took effect, only two Ohio Courts have endeavored to resolve this ambiguity.&nbsp;&nbsp;These Courts ultimately issued conflicting opinions.&nbsp;<\/p>\n\n\n\n<p><strong>Conflicting Court Decisions<\/strong><br>In 2009, a Cuyahoga County Court of Common Pleas judge first addressed this issue and ultimately held that the unit owners association of condominium is an owner under Ohio\u2019s lien law as it owns an equitable interest in the common elements by virtue of being authorized to contract for repairs and restoration to common elements.<sup>[7]<\/sup>&nbsp;This case involved a mechanic\u2019s lien naming the unit owners association as the owner and concerned repairs to the roof of a condominium pursuant to a contract between a contractor and unit owners association.<sup>[8]<\/sup>&nbsp;The Court reasoned that the explicit inclusion of the terms \u201cany interest\u201d and \u201cincluding both legal and equitable interests\u201d in Ohio\u2019s lien law\u2019s definition of who constitutes an owner, part owner, or lessee includes the unit owners association\u2019s equitable ownership interest in the common elements arising from its contract with the contractor for improvements thereto.<sup>[9]<\/sup><\/p>\n\n\n\n<p>Four years later, a Franklin County Court of Common Pleas judge decided a unit owners association is not an \u201cowner\u201d under Ohio\u2019s lien law.<sup>[10]<\/sup>&nbsp;This case involved a mechanic\u2019s lien recorded by a material supplier and naming 15 unit owners of a condominium and the common elements and the association with whom it contracted.<sup>[11]<\/sup>&nbsp;The Court held the unit owners association merely represent the unit owners\u2019 ownership interests, both legal and equitable, and the unit owners\u2019 ownership interests are not transferred the unit owners association when it contracts on their behalf.<sup>[12]<\/sup><\/p>\n\n\n\n<p><strong>Options for Liens on Common Elements<\/strong><br>Since 2013, no other Ohio Courts have addressed these conflicting opinions and ambiguity on the status of a unit owners association under Ohio\u2019s lien law remains to this day.&nbsp;&nbsp;The implications of this continuing uncertainty can result in a claimant recording an invalid and unenforceable lien.&nbsp;&nbsp;This results in a mechanic\u2019s lien claimant having three options to consider: (1) name and serve only the association as the owner in the affidavit; (2) name and serve all the unit owners in the affidavit; or (3) name and serve both the association and all the unit owners.<\/p>\n\n\n\n<p>The third option, despite being the most conservative way to ensure the validity of a mechanic\u2019s lien, may be impracticable in situations where a condominium has hundreds of unit owners.&nbsp;&nbsp;Ultimately, the ambiguity under Ohio law necessitates a case-by-case analysis for any mechanic\u2019s lien claim for an improvement to a common element of a condominium.&nbsp;&nbsp;Until the Ohio Legislature or Ohio Courts directly address this, a mechanic\u2019s lien claimant is best served to engage counsel on how best to secure a valid and enforceable mechanic\u2019s lien far ahead of their statutory deadline to record.<\/p>\n\n\n\n<p><a href=\"applewebdata:\/\/74248C08-5E39-4E06-9BC3-40B026782B5A#_ftnref1\">[1]<\/a>\u00a0R.C. \u00a71311 et. seq.\u00a0<br>[2]\u00a0R.C. \u00a71311.01(A).<br>[3]\u00a0R.C. 5311.13(C)<br>[4]\u00a0R.C. \u00a71311.06(A), R.C. \u00a71311.06(B)(1), and R.C. \u00a71311.07.<br>[5]\u00a0R.C. 5311.04(A).<br>[6]\u00a0R.C. 5311.14(A).<br>[7]\u00a0<em>R.P.W. Constr., Inc. v. Royal Park Condo. Owners Ass&#8217;n<\/em>, 2009 Ohio Misc. LEXIS 530, *5.\u00a0<br>[8]\u00a0<em>Id.\u00a0<\/em>at *1.\u00a0<br>[9]\u00a0<em>Id.\u00a0<\/em>at *5.\u00a0<br>[10]\u00a0<em>ABC Supply Co. v. Commons<\/em>, 2013 Ohio Misc. LEXIS 16571, *4 (Ohio C.P. June 12, 2013).\u00a0<br>[11]\u00a0<em>Id.\u00a0<\/em>at *2.\u00a0<br>[12]\u00a0<em>Id.\u00a0<\/em>at *7-8.\u00a0<\/p>\n\n\n\n<hr class=\"wp-block-separator has-alpha-channel-opacity\"\/>\n\n\n\n<p><strong>When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes &#8211; please call Advise &amp; Consult, Inc. at 888.684.8305, or email <a href=\"mailto:experts@adviseandconsult.net\">experts@adviseandconsult.net<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Ciaran Kelly | Frantz Ward Contractors, subcontractors, laborers, and material suppliers who perform work or labor upon or furnish materials in furtherance of any improvement undertaken by virtue of a contract with an owner, part owner, or lessee have mechanic\u2019s lien rights to secure payment in full for their completed work.[1]\u00a0Ohio\u2019s lien law provides that&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/mechanics-lien-rights-uncommon-issues-for-condominium\/\">Continue reading <span class=\"screen-reader-text\">Who Owns it Anyway? The Uncommon Issues Unique to Mechanic\u2019s Liens For Common Elements of a Condominium<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[10772],"tags":[9895,184,9120],"class_list":["post-903643","post","type-post","status-publish","format-standard","hentry","category-mechanics-lien-law","tag-advise-consult","tag-mechanics-lien-law","tag-ohio","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Who Owns it Anyway? 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