Mechanics’ Liens are to be Strictly Construed
Today’s BLOG article looks at the strict construction of mechanics’ liens with a focus on discharge bonds. As noted in our prior BLOG article, mechanics’ liens are powerful tools available to, inter alia, contractors, laborers and materialmen when they are not paid for their work in improving real property. One such article: “Mechanics’ Liens and Discharge Bonds” discussed the purpose of mechanic’s liens and certain mechanisms available to discharge liens through bonding. We noted that since a mechanic’s lien is an encumbrance on real property (Edward Joy Co., Inc. v. McGuire & Bennett, Inc., 199 A.D.2d 1015 (4th Dept. 1993)), filing a mechanic’s lien against real property can adversely impact the owner’s rights. For example, the filing of a mechanic s’ lien could be an event of default under a mortgage loan or the existence of a mechanic s’ lien could negatively impact the ability of an owner to mortgage or sell the liened property. Thus, the ability to discharge a lien is critical to an owner. Accordingly, as previously discussed, the lien law provides several mechanisms for an owner or general contractor to discharge a mechanic’s lien.
The significance of bonding liens was discussed long ago in Morton v. Tucker, 100 Sickels 244 (1895). There, a surety bonded a lien,[1] and when sued, argued that resort to the bond cannot be had “until the plaintiffs have exhausted their remedy by action against the [owner], and have recovered a judgment of foreclosure in form against the property described in the notice of lien.” The owner argued that “an action at law can be maintained upon the bond without first resorting to an action to foreclose the lien upon the property.” The Court rejected both positions and stated:
The sureties in the bond intended, and must be understood as undertaking, to pay the amount which it should be adjudged was due and owing to the plaintiffs, and which was chargeable against the property by virtue of their notice of lien. In other words, the condition was for the payment of any judgment which might have been rendered against the property had not the bond been given. The bond, as we have seen, is given to discharge the lien. It is one of the proceedings provided for by the statute, and it was evidently intended that the bond should take the place of the property, and become the subject of the lien, in the same form and manner as is provided for in the case of the payment of money into court, or the deposit of securities under an order of the court after action brought.
Id. at 248-49 (citation omitted).
Similarly, the Court in Tri-City Elec. Co., Inc. v. People, 96 A.D.2d 146 (4th Dept. 1983), affirmed 63 N.Y.2d 969 (1984), explained that “[i]t is significant to note that upon the posting of the various bonds, a shifting occurs and the lien detaches from its original adherence (appropriated funds or property) and attaches to the substitute, the bond [and, therefore, a] surety obligation is then substituted. This change is wrought by the statute, independently of the will of the lienor, or of any action or failure to act on his part.” Id. at 150 (citations and internal quotation marks omitted).
In order for the “switch” to take place, the lien must exist. Hewitt Builder and Renovations, Inc. v. Tectonic Builders, Inc., 249 A.D.3d 706 (2d Dept. 2026). “Pursuant to Lien Law § 17, a mechanic’s lien expires one year after filing unless an extension is filed with the County Clerk or an action is commenced to foreclose the lien and a notice of pendency is filed within that time period.” Id. at 707 (citation and internal quotation marks omitted). Because the lienor in Hewitt failed to file a notice of pendency or move for an extension of time to do so, the lien expired by operation of law. Id. Accordingly, the Court rejected the lienor’s argument that it was permitted to continue its foreclosure against the bond, stating that “the bond obtained by the defendants did not permit the plaintiff to continue the foreclosure action against the bond rather than the property as the bond was obtained after the lien had automatically expired by operation of law.” Id. (citation omitted).
In addition, mechanic’s liens are purely statutory and, accordingly, the Lien Law is to be strictly construed. In Birmingham Iron Foundry v. Glen Cove Starch Mfg. Co., 33 Sickles 30 (1879), the Court rejected the lienor’s claimed entitlement to a mechanic’s lien and recognized that “[s]uch a lien does not exist at common law. It is no part of the contract to be enforced where that can be enforced. It is purely the creature of the statute.” Id. at 32. It has been noted that “strict compliance with the [Lien Law’s] statutory requirements is mandated and[, therefore,] the courts do not have discretion to excuse noncompliance.” Thompson Bros. Pile Corp. v. Rosenblum, 121 A.D.3d 672, 674 (2d Dept. 2014) (citation omitted). See also 146 West 45th Street Corp. v. McNally, 188 A.D.2d 410, 411 (2d Dept. 1992) (vacatur of mechanics liens mandated “in the absence of strict compliance by the lienor with the provisions” of the Lien Law).
It should be noted that Lien Law § 23 provides that the Lien Law “is to be construed liberally to secure the beneficial interests and purposes thereof. A substantial compliance with its several provisions shall be sufficient for the validity of a lien and to give jurisdiction to the courts to enforce the same.” The tension between liberal construction and strict compliance has been explained:
The mechanic's lien statute is a remedial one and is to be liberally construed to carry out the purpose of its enactment…. A substantial compliance with its several provisions shall be sufficient for the validity of a lien and to give jurisdiction to the courts to enforce the same. This rule of liberal construction is not without limit however and does not authorize judicial legislation to enlarge the clearly defined scope of purpose of the Lien Law. The Lien Law should be construed as giving no other legal or equitable relief to those who fail to use the remedies given. Notwithstanding that an undertaking has been given for the discharge of a lien, an action to enforce such lien is equitable not legal in nature. [Citations and internal quotation marks omitted.]
Tri-City, 96 A.D.2d at 149 (citations and internal quotation marks omitted).
Against this backdrop, we discuss CFS Enter., Inc. v. CG & J Realty, LLC, a case decided by the Second Department on October 14, 2026. On November 7, 2022, the plaintiff in CFS filed a mechanic’s lien against the defendant’s property and commenced an action to foreclose the lien in February 2023. In April 2023, the defendant posted a bond pursuant to Lien Law § 19 to discharge the lien and filed a notice of discharge of public improvement lien bond. In July 2023, the General Contractor posted a bond pursuant to Lien Law § 37, to discharge all liens.[2] The court (in the General Contractor’s separate proceeding) issued an order discharging “all liens and claims against the premises, setting forth that the Section 37 bond ‘shall supersede all prior bonds that discharged any liens and claims’ against the premises.” See CSF at page 2. The owner then moved to vacate and cancel its Section 19 bond and to dismiss the mechanic’s lien foreclosure cause of action against it. The defendant’s motion was denied by the motion court and the defendant appealed. The Second Department affirmed. In so doing, the Court reiterated the statutory roots of the Lien Law and the need for strict compliance, and stated:
Mechanic's liens have their derivation entirely in statutory law, existing neither in common law nor in equity. As such, strict compliance with the statutory requirements is mandated and the court does not have discretion to excuse noncompliance. Lien Law § 59 provides, in pertinent part, that "[a] mechanic's lien notice of which has been filed on real property or a bond given to discharge the same may be vacated by an order of a court of record. Before such order shall be granted, a notice shall be served upon the lienor, either personally or by leaving it at his or her last known place of residence, with a person of suitable age, with directions to deliver it to the lienor." Here, the defendant failed to satisfy the requirements of Lien Law § 59, as the defendant merely filed on NYSCEF the order to show cause informing the plaintiff of the defendant's intention to vacate the bond and did not personally serve it on the plaintiff or leave it with a person of suitable age and discretion at the plaintiff's last known place of residence. (Citations, internal quotation marks, brackets and ellipses omitted.)
Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP.
This article is for informational purposes and is not intended to be and should not be taken as legal advice.
[1] For anyone wondering how prices have changed over time, the lien was in the amount of $528.49 and the matter was decided by the Court of Appeals.
[2] Lien Law § 37 permits an owner or contractor to file a bond discharging all liens filed or that may be filed on a project.
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