On May 15, 2020, in Geo-technology Associates Inc. v. Capital Station Dover, LLC, the Delaware Supreme Court dismissed an action to enforce a mechanic’s lien because the geotechnical and construction observation services provided by the plaintiff were not covered by Delaware’s mechanic’s lien statute. Per the court, mechanic’s lien rights are available in Delaware for any person who furnishes labor or material or both (in an amount greater than $25) in connection with the erection, alteration, or repair of any structure. The Delaware lien statute also provides a list of other services which may give rise to a mechanic’s lien — none of which include geotechnical testing or construction observation services. Strictly construing the lien statute, the court found that testing and observation services did not fall within the scope of “erection, alteration, or repair of any structure” and that such services could not be construed to fall within the list of other services covered by the Delaware lien statute.
Like the Delaware Supreme Court, most states strictly construe their lien statutes, so creative interpretations of the scope of such statutes by potential lienors may not meet with much success in subsequent enforcement actions. Beyond meeting with failure or dismissal, potential lienors should also consider other consequences to filing an invalid lien or lien enforcement action. The defendant in Geo-technology sought attorneys’ fees, and, although the court denied the request based on Delaware law and the applicable contract language, other courts may come to a different conclusion. Frivolous liens may also be subject to claims relating to improperly clouding title to property. Before filing a lien, lienors should consider such consequences carefully and consider consulting an attorney. If you have any questions about this case or lien law in general, please feel free to contact Aman Kahlon.