Jeff entered into a building contract with Mike under which Jeff agreed to construct a garage on Mike's lot for $60,000. Lumber Supply Company supplied the lumber at Jeff's request, but when Jeff failed to pay for the material within a few weeks after it was supplied, the company filed a construction lien for $30,000 against Mike's property. The lumber company has no right of lien because it has a contractual relationship with Jeff only, and must look to Jeff for payment.

Question

Quizplus · Accepted Answer

The lumber company can file a construction lien against Mike's property because, in many jurisdictions, suppliers of materials to a construction project can file a lien for non-payment even if their direct contract is with the contractor and not the property owner. This is designed to protect suppliers and ensure they are paid for materials used in improving the property.

Jeff Entered into a Building Contract with Mike Under Which