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Claim on Lien Bond Rejected

October 29, 2007  |  from Washington Construction Law Blog

The mechanics lien statute gives an Owner the option of discharging a lien against its property by purchasing a bond normally in the amount of 150% of the lien.  See RCW 60.04.161. 

The Owner in this case purchased such a bond, and thereby cleared title for the sale of its property.  The lien claimant (DBM Consulting) thereafter went to trial against the Owner on its breach of contract claim and won a verdict of roughly $68,000 plus legal fees and interest.

Verdict in hand, the lien claimant turned to the bond surety and demanded payment.  Rejecting the claim, Division 1 held that the lien claimant failed to obtain judgment against the bond as well as the Owner.  For that reason, the lienability of the construction work and the validity of the lien were not litigated -- and any attempt to litigate that issue now would be barred by res judicata. 

The lesson?  The bond stands in for the real estate but does not eliminate the claimant's burden of proving the same elements that would need to be established without the bond -- i.e., timeliness of the lien, coverage of the lien statute, validity of lien notice, etc.

Copy of opinion also available here Download file

Filed: Construction-Law