By David W. Floren, Esq.
My annual drive to Yosemite National Park from the San Francisco Bay Area takes me through a place called Chinese Camp in Tuolemne County. Chinese Camp was a mining town back in 1849 and now is called a “census-designated place” with a population of less than 200. As I found out, no place is too small for a mechanic’s lien dispute.
I try not to focus on legal issues on these nice, relaxing drives out to Yosemite. But now my idea of Chinese Camp has changed forever, thanks to a recent judicial opinion that allowed an equipment leasing company to foreclose on its mechanic’s lien on building located in Chinese Camp. The buildings, large lumber drying kilns, were removed in 2006. The bill for the leased equipment did not get paid and a lawsuit followed.
The trial court did not think that the simple act of removing the kilns, without any further construction-type work, met the statutory definition of a “work of improvement.” This definition is crucial because if it’s not a “work of improvement,” no mechanic’s lien suit can go forward.
The trial court was convinced that for a hob to meet the definition of a “work of improvement” some kind of extra construction work would have to be performed after the original buildings were gone. But the reviewing court strongly disagreed and explained that simple removal of buildings is a “work of improvement as a whole” as spelled out in the underlying contract.
The kilns that were removed met the definition of “buildings” under the mechanic’s lien statutes. The contract called only for removal of the kilns and no further construction. In other words, if all I’m asking for that my lumber kiln buildings be dismantled and hauled away and nothing more. I’m usually asking for a “work of improvement” to be performed on my land.
This answers a question that some contractors may have which is whether or not demolition work qualifies as a “work of improvement.” The answer is, it does.
The judicial opinion is United Rentals Northwest, Inc. v. Snider Lumber Products, Inc. (2009) 174 Cal.App.4th 1479.
David W. Floren is an associate attorney at the Law Office of Robert B. Jacobs in Pleasanton, California. The firm’s web page can be visited on the Web at www.RBJLaw.com. This article is not a complete discussion of California law on the subject and is not intended to be legal advice. Readers with a specific matter or question should consult an attorney.