In 2014, an elevator contractor contracted to service, maintain and repair the elevator for a 7-story, 21-unit East Village residential building. The contractor received a monthly sum for being on call, plus additional sums if services were provided. In 2021, the building terminated the contract. The contractor filed a mechanics lien against the building for $17,812 for "supply[ing] and install[ing] elevator materials."
The building sought to summarily vacate the mechanics lien. The contractor did not put in any opposing papers. The court in Sasha Realty LLC v Eltech Industries,Inc. (November 22, 2022 Supreme Court, New York County) held that the contractor, to be eligible to file a mechanics lien, had to provide work for the permanent improvement of the property. The contract was for general upkeep and maintenance. Therefore, the lien was summarily discharged.
A contractor can file a mechanics lien for work for the improvement of real property. "Improvement" includes the "demolition, erection, alteration or repair" of any structure. If the contractor's work enhances the value of the real property, the contractor may have a lien on the real property to the extent of the value performed. On the other hand, temporary work such as cutting the lawn, replacing burned out light bulbs, or janitorial cleanup is maintenance and general upkeep. They only preserve the real property. This type of work is not lienable in New York.
A service and maintenance contract may call for replacement parts to be permanently installed in the building. The parts are incorporated and affixed into the real property/building. The contractor may then file a New York mechanics lien for at least that portion of the work.
Here, the contractor defaulted on the motion. The contractor did not let the court know if it had supplied replacement parts permanently incorporated into the building. The court, deprived of this information, had no choice but to accept the representation of the property owner that the lien sought only amounts due on a maintenance contract. Unfortunately, this case will undoubtedly be cited for the overbroad (and largely inaccurate) proposition that one can never lien for maintenance work.
How enduring must a service and maintenance contractor's work be to allow it to file a mechanic's lien? Each case is fact dependent. If the installed replacement parts are manufactured so as to last a long time and not easily installed/removed, the service and maintenance contractor should still have a viable mechanics lien. Another elevator service and maintenance contractor defeated a different building owner's attempt to summarily vacate a $6711 mechanics lien by describing its work as "elevator maintenance and repair, together with related materials." More importantly, the elevator contractor opposed the owner's motion there.
What is the take-away? A contractor providing service and maintenance to a building may be able to file a mechanics lien. But the contractor must be prepared to show it provided more than general upkeep, and that the work was affixed to and enhanced the value of the real property.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.