We are building a new home in Texas. Still living in our current home while home is being built. We asked the land clearing company being used by our builder to do some extra clearing, underbrushing and tree removal and gave them 1/2 down to do work. There was NO CONTRACT SIGNED - simply a verbal agreement with a written estimate, which we did not sign off on rather a verbal approval was given in a phone call. The company did not do everything agreed to, we had to hire someone else to finish it up, and the company is now requesting the final payment. We just received a notice of intent to file a lien against the property if payment is not received within five days. Can they do this? How should we handle this?
Hello,
They can do it. Whether or not the court would see it as true is a completely seperate matter.
Proper handling of this matter is to communicate with the company trying to claim a lien. You want to tell them they did not complete everything they were asked to do and that you had to hire a subsequent contractor.
If they file a lien, that alone only clouds title on your property which will affect financing. They still have to sue you to enforce it. Or you can sue them to remove the lien and for breach of contract. Their leverage against you is the fact that there was no written contract signed so both parties are going to have to go He Said/She Said in front of a judge later. Their understanding was that the work was completed. This is not advisable. They also have some leverage in that they may hold up your immediate future financing.
If you are not worried about immediate financing, though, you have some leverage because, to see any money out of the lien, they have to sue you in District Court and prove they are owed that money which opens them up to a countersuit against you.
In all honesty, the best bet here is to get on the phone with them to negotiate. Depending on the amount of the lien, you may save money by negotiating the price down because both sides will have to spend money on lawyers in District Court and there's a chance that neither party will recover anything from the other party in the event of a victory in court.
E. Aaron Cartwright III
214.789.1354
Aaron@EACLawyer.com