ILLINOIS

LIEN LAWS BY STATE
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ILLINOIS COMPILED STATUTES
CHAPTER 770 LIENSACT 60 MECHANICS LIEN ACT

60/0.01 Short Title

60/1 Persons Entitled to Liens

60/1.1 Waivers Unenforceable

60/2 Work and Materials Furnished by Mistake

60/3 Lands Belonging to Married Persons

60/4 Discontinuance of Work, Abandonment, Repossession of Materials

60/5 Statement Under Oath of Persons Furnishing Work and Materials, Notice, Notice to Owner of Residence

60/6 Stipulation of Time for Completion

60/7 Action to Enforce Lien, Time, Recording Claim of Lien, Separate Buildings

60/8 Assignments

60/9 Foreclosure Suit, Parties, Pleadings

60/10 Successors and Representatives

60/11 Foreclosure Complaint, Summons, Service, Parties

60/12 Practice and Procedure, Receivers

60/13 Answer, Counterclaim, Lien for Wages, Affidavits

60/14 Continuances

60/15 Priorities

60/16 Priorities, Encumbrances

60/17 Costs, Attorneys Fees

60/18 Foreclosure Sale

60/19 Application of Proceeds of Foreclosure Sale, Deficiency

60/20 Redemption

60/21 Subcontractors and Suppliers to Contractor, Liens, Waivers, Preliminary Notice to Owner, Pay-When-Paid Clauses

60/21.01 Willful Failure to Pay – Misdemeanor

60/21.02 Construction Funds Held in Trust

60/22 Sub Subcontractors, Statement by Subcontractor

60/23 Definitions, Public Projects, Notice of Claim, Lien Against Money or Bonds, Actions, Parties, Limitations, Liens of Persons Furnishing Work or Materials to Contractor, Notices, Limitations, Pleadings

60/24 Persons Furnishing Labor or Materials to Contractor, Notice of Claim to Owner, Service, Filing

60/25 Notice to Non-Resident

60/26 Labor Liens Preferred

60/27 Owner to Withhold Money, Preferences

60/28 Claim for Lien, Enforcement, Actions, Judgment

60/30 Joinder of Parties, Prorata Distribution

60/31 Failure to Complete Contract

60/32 Improper Payments by Owner

60/34 Demand for Suit, Forfeiture

60/35 Acknowledgment of Satisfaction, Recording, Release

60/36 Removal of Materials With Intent to Defraud, Misdemeanor

60/37 Liens on Boats, Mobile Homes

60/38 Recording, Indexing, Fees

60/39 Liberal Construction

ILLINOIS COMPILED STATUTES

CHAPTER 770 LIENS

ACT 60 MECHANICS LIEN ACT

60/0.01 Short Title, This Act may be cited as the Mechanics Lien Act.

60/1 Persons Entitled to Liens

Any person who shall by any contract or contracts, express or implied, or partly expressed or implied, with the owner of a lot or tract of land, or with one whom the owner has authorized or knowingly permitted to contract, to improve the lot or tract of land or to manage a structure thereon, or to furnish material, fixtures, apparatus or machinery, forms or form work used in the process of construction where cement, concrete or like material is used for the purpose of or in the building, altering, repairing or ornamenting any house or other building, walk or sidewalk, whether the walk or sidewalk is on the land or bordering thereon, driveway, fence or improvement or appurtenances to the lot or tract of land or connected therewith, and upon, over or under a sidewalk, street or alley adjoining; or fill, sod or excavate such lot or tract of land, or do landscape work thereon or therefore; or raise or lower any house thereon or remove any house thereto, or remove any house or other structure therefrom, or perform any services or incur any expense as an architect, structural engineer, professional engineer, land surveyor or property manager in, for or on a lot or tract of land for any such purpose; or drill any water well thereon; or furnish or perform labor or services as superintendent, time keeper, mechanic, laborer or otherwise, in the building, altering, repairing or ornamenting of the same; or furnish material, fixtures, apparatus, machinery, labor or services, forms or form work used in the process of construction where concrete, cement or like material is used, or drill any water well on the order of his agent, architect, structural engineer or superintendent having charge of the improvements, building, altering, repairing or ornamenting the same, is known under this Act as a contractor, and has a lien upon the whole of such lot or tract of land and upon adjoining or adjacent lots or tracts of land of such owner constituting the same premises and occupied or used in connection with such lot or tract of land as a place of residence or business; and in case the contract relates to 2 or more buildings, on 2 or more lots or tracts of land, upon all such lots and tracts of land and improvements thereon for the amount due to him for such material, fixtures, apparatus, machinery, services or labor, and interest at the rate of 10% per annum from the date the same is due. This lien extends to an estate in fee, for life, for years, or any other estate or any right of redemption, or other interest which the owner may have in the lot or tract of land at the time of making such contract or may subsequently acquire. The taking of additional security by the contractor or subcontractor is not a waiver of any right of lien which he may have by virtue of this Act, unless made a waiver by express agreement of the parties and the waiver is not prohibited by this Act. This lien attaches as of the date of the contract.

60/1.1 Waivers Unenforceable

An agreement to waive any right to enforce or claim any lien under this Act where the agreement is in anticipation of and in consideration for the awarding of a contract or subcontract, either express or implied, to perform work or supply materials for an improvement upon real property is against public policy and unenforceable. This Section does not prohibit subordination or release of a lien granted under this Act.

60/2 Work and Materials Furnished by Mistake

Any person furnishing services, labor or material for the erection of a building, or structure, or improvement, by mistake upon land owned by another than the party contracting as owner, shall have a lien for such services, labor or material upon such building, or structure or improvement, and the court, in the enforcement of such lien, shall order and direct such building, structure or improvement to be separately sold under its judgment, and the purchaser may remove the same within such reasonable time as the court may fix.

60/3 Lands Belonging to Married Persons

If any such services or labor are performed upon or materials are furnished for lands belonging to any married person, with the married person’s knowledge and not against the married person’s protest in writing, as provided in Section 1 of this Act, in pursuance of a contract with the spouse of such married person, the person furnishing such labor or materials shall have a lien upon such property, the same as if such contract had been made with the married person, and in case the title to such lands upon which improvements are made is held by husband and wife jointly, the lien given by this act shall attach to such lands and improvements, if the improvements be made in pursuance of a contract with both of them, or in pursuance of a contract with either of them, and in such cases no claim of homestead right set up by a husband or wife shall defeat the lien given by this Act.

60/4 Discontinuance of Work, Abandonment, Repossession of Materials

When the owner of the land shall fail to pay the contractor moneys justly due him under the contract at the time when the same should be paid, or fails to perform his part of the contract in any other manner, the contractor may discontinue work, and the contractor shall not be held liable for any delay on his part during the period of, or caused by, such breach of contract on the part of the owner; and if after such breach for the period of ten days the owner shall fail to comply with his contract, the contractor may abandon the work, and in such a case the contractor shall be entitled to enforce his lien for the value of what has been done, and the court shall adjust his claim and allow him a lien accordingly. In such cases all persons furnishing material which has not been incorporated in the improvement shall have the right to take possession of and remove the same if he so elects.

60/5 Statement Under Oath of Persons Furnishing Work and Materials, Notice, Notice to Owner of Residence

It shall be the duty of the contractor to give the owner, and the duty of the owner to require of the contractor, before the owner or his agent, architect, or superintendent shall pay or cause to be paid to the contractor or to his order any moneys or other consideration due or to become due to the contractor, or make or cause to be made to the contractor any advancement of any moneys or any other consideration, a statement in writing, under oath or verified by affidavit, of the names and addresses of all parties furnishing materials and labor and of the amounts due or to become due to each. Merchants and dealers in materials only shall not be required to make statements required in this Section. Each contractor shall provide each owner, either as part of the contract or as a separate printed statement, the following:

“THE LAW REQUIRES THAT THE CONTRACTOR SHALL SUBMIT A SWORN STATEMENT OF PERSONS FURNISHING MATERIALS AND LABOR BEFORE ANY PAYMENTS ARE REQUIRED TO BE MADE TO THE CONTRACTOR.”

If printed in the contract, the statement shall be set in type that is at least the same size as the largest type used in the body of the contract and is bold face or another font that clearly contrasts with and sets the statement apart from the rest of the body of the contract. It shall be the duty of each subcontractor who has furnished, or is furnishing, materials or labor for an existing owner-occupied single-family residence, in order to preserve his lien, to notify the occupant either personally or by certified mail, return receipt requested, addressed to the occupant or his agent at the residence within 60 days from his first furnishing materials or labor, that he is supplying materials or labor. Any notice given after 60 days by the subcontractor, however, shall preserve his lien, but only to the extent that the owner has not been prejudiced by payments made before receipt of the notice. The notice shall contain the name and address of the subcontractor or material man, the date he started to work or to deliver materials, the type of work done and to be done or the type of materials delivered and to be delivered, and the name of the contractor requesting the work. The notice shall also contain the following warning:

“NOTICE TO OWNER

The subcontractor providing this notice has performed work for or delivered material to your home improvement contractor. These services or materials are being used in the improvements to your residence and entitle the subcontractor to file a lien against your residence if the services or materials are not paid for by your home improvement contractor. A lien waiver will be provided to your contractor when the subcontractor is paid, and you are urged to request this waiver from your contractor when paying for your home improvements.”

The warning shall be in at least 10 point boldface type. For purposes of this Section, notice by certified mail is considered served at the time of its mailing.

60/6 Stipulation of Time for Completion

In no event shall it be necessary to fix or stipulate in any contract a time for the completion or a time for payment in order to obtain a lien under this act, provided, that the work is done or material furnished within three years from the commencement of said work or the commencement of furnishing said material.

60/7 Action to Enforce Lien, Time, Recording Claim of Lien, Separate Buildings

No contractor shall be allowed to enforce such lien against or to the prejudice of any other creditor or incumbrancer or purchaser, unless within 4 months after completion, or if extra or additional work is done or material is delivered therefore within 4 months after the completion of such extra or additional work or the final delivery of such extra or additional material, he or she shall either bring an action to enforce his or her lien therefore or shall file in the office of the recorder of the county in which the building, erection or other improvement to be charged with the lien is situated, a claim for lien, verified by the affidavit of himself or herself, or his or her agent or employee, which shall consist of a brief statement of the contract, the balance due after allowing all credits, and a sufficiently correct description of the lot, lots or tracts of land to identify the same. Such claim for lien may be filed at any time after the contract is made, and as to the owner may be filed at any time after the contract is made and within 2 years after the completion of the contract, or the completion of any extra work or the furnishing of any extra material thereunder, and as to such owner may be amended at any time before the final judgment. No such lien shall be defeated to the proper amount thereof because of an error or overcharging on the part of any person claiming a lien therefore under this Act, unless it shall be shown that such error or overcharge is made with intent to defraud; nor shall any such lien for material be defeated because of lack of proof that the material after the delivery thereof, actually entered into the construction of such building or improvement, although it be shown that such material was not actually used in the construction of such building or improvement; provided, it is shown that such material was delivered either to the owner or his or her agent for that building or improvement, to be used in that building or improvement, or at the place where said building or improvement was being constructed, for the purpose of being used in construction or for the purpose of being employed in the process of construction as a means for assisting in the erection of the building or improvement in what is commonly termed forms or form work where concrete, cement or like material is used, in whole or in part.

In case of the construction of a number of buildings under contract between the same parties, it shall be sufficient in order to establish such lien for material, if it be shown that such material was in good faith delivered at one of these buildings for the purpose of being used in the construction of any one or all of such buildings, or delivered to the owner or his or her agent for such buildings, to be used therein; and such lien for such material shall attach to all of said buildings, together with the land upon which the same are being constructed, the same as in a single building or improvement. In the event the contract relates to 2 or more buildings on 2 or more lots or tracts of land, then all of these buildings and lots or tracts of land may be included in one statement of claims for a lien.

60/8 Assignments

All liens or claims for lien which may arise or accrue under the terms of this act shall be assignable, and proceedings to enforce such liens or claims for lien may be maintained by and in the name of the assignee, who shall have as full and complete power to enforce the same as if such proceedings were taken under the provisions of this act by and in the name of the lien claimant.

60/9 Foreclosure Suit, Parties, Pleadings

If payment shall not be made to the contractor having a lien by virtue of this act of any amount due when the same becomes due, then such contractor may bring suit to enforce his lien in the circuit court in the county where the improvement is located, and in the event that the contract relates to two or more buildings or two or more lots or tracts of land, then all of said buildings and lots or tracts of land may be included in one complaint. Any two or more persons having liens on the same property may join in bringing such suit, setting forth their respective rights in their complaint; all lien claimants not made parties thereto may upon filing a petition to intervene become defendants and enforce their liens by counterclaim against all the parties to the suit; and the complaint shall not thereafter be dismissed as to any lien claimant, or as to the owner or owners of the premises without the consent of such lien claimant. The plaintiff and all defendants to such complaint may contest each other’s right without any formal issue of record made up between them other than that shown upon the original complaint, as well with respect to the amount due as to the right to the benefit of the lien claimed: Provided, that if by such contest by co-defendants any lien claimants be taken by surprise, the court may, in its discretion, as to such claim, grant a continuance. The court may render judgment against any party summoned and failing to appear, as in other cases of default. Such suit shall be commenced or counterclaim filed within two years after the completion of the contract, or completion of the extra or additional work, or furnishing of extra or additional material thereunder.

60/10 Successors and Representatives

Suits may be instituted under the provisions of this act in favor of administrators or executors, and may be maintained against the representatives in the interest of those against whom the cause of action accrued, and in suits instituted under the provisions of this act, the representatives of any party who may die pending the suit shall be made parties.

60/11 Foreclosure Complaint, Summons, Service, Parties

The complaint shall contain a brief statement of the contract or contracts on which it is founded, the date, when made, and when completed, if not completed, why, and it shall also set forth the amount due and unpaid, a description of the premises which are subject to the lien, and such other facts as may be necessary to a full understanding of the rights of the parties. Where plans and specifications are by reference made a part of the contract it shall not be necessary to set the same out in the pleadings or as exhibits, but the same may be produced on the trial of the suit. The plaintiff shall make all parties interested, of whose interest he is notified or has knowledge, parties defendant, and summons shall issue and service thereof be had as in other civil actions; and when any defendant resides or has gone out of the State, or on inquiry cannot be found, or is concealed within this State, so that process cannot be served on him, the plaintiff shall cause a notice to be given to him, or cause a copy of the complaint to be served upon him, in like manner and upon the same conditions as is provided in other civil actions, and his failure to so act with regard to summons or notice shall be ground for judgment against him as upon the merits. The same rule shall prevail with counterclaimants with regard to any person of whose interest they have knowledge, and who are not already parties to the suit or action. Parties in interest, within the meaning of this act, shall include persons entitled to liens thereunder whose claims are not, as well as are, due at the time of the commencement of suit, and such claim shall be allowed subject to a reduction of interest from the date of judgment to the time the claim is due; also all persons who may have any valid claim to the whole or any part of the premises upon which a lien may be attempted to be enforced under the provisions thereof, or who are interested in the subject matter of the suit. Any such persons may, on application to the court wherein the suit is pending, be made or become parties at any time before final judgment. No action under the provisions of this act shall be voluntarily dismissed by the party bringing it without due notice to all parties before the court and leave of court upon good cause shown and upon terms designated by the court.

60/12 Practice and Procedure, Receivers

The court shall permit amendments to any part of the pleadings, and may issue process, make all orders, requiring parties to appear, and requiring notice to be given, that are or may be authorized in other civil actions and shall have the same power and jurisdiction of the parties and subject matter, and the rules of practice and proceedings in such cases shall be the same as in other civil cases, except as is otherwise provided in this act. The court shall have power to appoint receivers for property on which liens are sought to be enforced in the same manner for the same causes and for the same purposes as in cases of foreclosure of mortgages, as well as to complete any unfinished building where the same is deemed to be to the best interest of all the parties interested.

60/13 Answer, Counterclaim, Lien for Wages, Affidavits

Defendant shall answer as in other civil actions. The owner may make any defense against the contractor by way of counterclaim that he could in any civil action for the payment of money, and may have the same right of recovery on proof of such in excess of the claim of the contractor against the contractor only, but for matters not growing out of the contract recovery shall be without prejudice to the rights of the sub-contractors thereunder for payment out of the contract price or fund. In any proceedings to enforce a lien on account of wages due for labor the claimant need file only an affidavit giving the amount due, between what dates the labor was performed and the kind of labor performed, and the court shall direct the amount due for wages as therein specified to be paid within a short day to be fixed by the court, unless within 10 days after the filing of the claim the amount claimed is contested by the owner or some other party to the suit. The party making such contest shall file an affidavit which shall state his defense to the allowance of the claim, and the court shall proceed at once to hear the evidence, and determine the merits of the claim, and in the event the allowance for wages is not paid within the time fixed by the court, the court shall order the premises sold to pay the amount in such manner as it directs.

60/14 Continuances

In no case shall the want of preparation for trial of one claim delay the trial in respect to others, but trial shall be had upon issues between such parties as are prepared without references to issue between other parties; and when one creditor shall have obtained a judgment for the amount due, the court may order a sale of the premises on which the lien operates, or a part thereof, so as to satisfy the judgment: Provided, That the court may, for good cause shown, delay making any order for sale or distribution until the rights of all parties in interest are ascertained and settled by the court.

60/15 Priorities

Upon all questions arising between different contractors having liens under this act, no preference shall be given to him whose contract was made first, except the claim of any person for wages by him personally performed, shall be a preferred lien.

60/16 Priorities, Encumbrances

No incumbrance upon land, created before or after the making of the contract under the provisions of this act, shall operate upon the building erected, or materials furnished until a lien in favor of the persons having done work or furnished material shall have been satisfied, and upon questions arising between incumbrancers and lien creditors, all previous incumbrances shall be preferred to the extent of the value of the land at the time of making of the contract, and the lien creditor shall be preferred to the value of the improvements erected on said premises, and the court shall ascertain by jury or otherwise, as the case may require, what proportion of the proceeds of any sale shall be paid to the several parties in interest. All incumbrances, whether by mortgage, judgment or otherwise, charged and shown to be fraudulent, in respect to creditors, may be set aside by the court, and the premises freed and discharged from such fraudulent incumbrance.

60/17 Costs, Attorneys Fees Costs.

(a) The costs of proceedings as between all parties to the suit shall be taxed equitably against the losing party, and where taxed against more than one party, shall be so taxed against all in favor of the proper party but equitably as between themselves; and the costs, as between creditors aforesaid in contests relative to each other’s claims, shall be subject to the order of the court, and the same rule shall prevail in respect to costs growing out of the proceedings against and between incumbrances.

(b) If the court specifically finds that the owner who contracted to have the improvements made failed to pay any lien claimant the full contract price, including extras, without just cause or right, the court may tax that owner, but not any other party, the reasonable attorney’s fees of the lien claimant who had perfected and proven his or her claim.

(c) If the court specifically finds that a lien claimant has brought an action under this Act without just cause or right, the court may tax the claimant the reasonable attorney’s fees of the owner who contracted to have the improvements made and defended the action, but not those of any other party.

(d) “Without just cause or right”, as used in this Section, means a claim asserted by a lien claimant or a defense asserted by the owner who contracted to have the improvements made, which is not well grounded in fact and warranted by existing law or a good faith argument for the extension, modification, or reversal of existing law.

(e) This amendatory Act of 1995 applies to any mechanics lien claim that is perfected on or after the effective date of this amendatory Act of 1995.

60/18 Foreclosure Sale

Whatever right or estate such owner had in the land at the time of making the contract may be sold in the same manner as other sales of real estate are made under orders of court. If any part of the premises can be separated from the residue, and sold without damage to the whole, and if the value thereof is sufficient to satisfy all the claims proved in the cause, the court may order a sale of that part.

60/19 Application of Proceeds of Foreclosure Sale, Deficiency

The court shall ascertain the amount due each lien creditor and shall direct the application of the proceeds of sale to be made to each in proportion to their several amounts, according to the provisions of this act, but the claims of all persons for labor as provided in Section 15 of this Act shall be first paid. If, upon making sale under this act of any or all premises, the proceeds of such sale shall not be sufficient to pay all claims of all parties, according to their rights, the judgment shall be credited by the amount of the sale and enforcement may proceed in favor of any creditor whose claims are not satisfied for the balance due as upon a deficiency judgment in the foreclosure of a mortgage and such deficiency judgment shall be a lien upon all real estate and other property of the party against whom it is entered to the same extent and under the same limitations as a judgment for the payment of money; and in case of excess of sales over the amount of the judgment, such excess be paid to the owner of the land, or to the person who may be entitled to the same, under the direction of the court.

60/20 Redemption

Upon all sales under this Act the right of redemption shall exist in favor of the same persons, and may be made in the same manner as is or may be provided for redemption of real estate from sales under judgments for the payment of money.

60/21 Subcontractors and Suppliers to Contractor, Liens, Waivers, Preliminary Notice to Owner, Pay-When-Paid Clauses

Subject to the provisions of Section 5, every mechanic, worker or other person who shall furnish any materials, apparatus, machinery or fixtures, or furnish or perform services or labor for the contractor, or shall furnish any material to be employed in the process of construction as a means for assisting in the erection of the building or improvement in what is commonly termed form or form work where concrete, cement or like material is used in whole or in part, shall be known under this Act as a sub-contractor, and shall have a lien for the value thereof, with interest on such amount from the date the same is due, from the same time, on the same property as provided for the contractor, and, also, as against the creditors and assignees, and personal and legal representatives of the contractor, on the material, fixtures, apparatus or machinery furnished, and on the moneys or other considerations due or to become due from the owner under the original contract. If the legal effect of any contract between the owner and contractor is that no lien or claim may be filed or maintained by any one and the waiver is not prohibited by this Act, such provision shall be binding; but the only admissible evidence thereof as against a sub-contractor or material man, shall be proof of actual notice thereof to him before any labor or material is furnished by him; or proof that a duly written and signed stipulation or agreement to that effect has been filed in the office of the recorder of the county or counties where the house, building or other improvement is situated, prior to the commencement of the work upon such house, building or other improvement, or within 10 days after the execution of the principal contract or not less than 10 days prior to the contract of the sub-contractor or material man. The recorder shall record the same at length in the order of time of its reception in books provided by him for that purpose, and the recorder shall index the same, in the name of the contractor and in the name of the owner, in books kept for that purpose, and also in the tract or abstract book of the tract, lot, or parcel of land, upon which the house, building or other improvement is located, and the recorder shall receive therefore a fee, such as is provided for the recording of instruments in his office.

It shall be the duty of each subcontractor who has furnished, or is furnishing, materials or labor for an existing owner-occupied single family residence, in order to preserve his lien, to notify the occupant either personally or by certified mail, return receipt requested, addressed to the occupant or his agent of the residence within 60 days from his first furnishing materials or labor, that he is supplying materials or labor; provided, however, that any notice given after 60 days by the subcontractor shall preserve his lien, but only to the extent that the owner has not been prejudiced by payments made prior to receipt of the notice. The notification shall include a warning to the owner that before any payment is made to the contractor, the owner should receive a waiver of lien executed by each subcontractor who has furnished materials or labor.

The notice shall contain the name and address of the subcontractor or material man, the date he started to work or to deliver materials, the type of work done and to be done or the type of materials delivered and to be delivered, and the name of the contractor requesting the work. The notice shall also contain the following warning:

“NOTICE TO OWNER

The subcontractor providing this notice has performed work for or delivered material to your home improvement contractor. These services or materials are being used in the improvements to your residence and entitle the subcontractor to file a lien against your residence if the services or materials are not paid for by your home improvement contractor. A lien waiver will be provided to your contractor when the subcontractor is paid, and you are urged to request this waiver from your contractor when paying for your home improvements.”

Such warning shall be in at least 10 point bold face type. For purposes of this Section, notice by certified mail is considered served at the time of its mailing.

In no case, except as hereinafter provided, shall the owner be compelled to pay a greater sum for or on account of the completion of such house, building or other improvement than the price or sum stipulated in said original contract or agreement, unless payment be made to the contractor or to his order, in violation of the rights and interests of the persons intended to be benefited by this act:

Provided, if it shall appear to the court that the owner and contractor fraudulently, and for the purpose of defrauding sub-contractors fixed an unreasonably low price in their original contract for the erection or repairing of such house, building or other improvement, then the court shall ascertain how much of a difference exists between a fair price for labor and material used in said house, building or other improvement, and the sum named in said original contract, and said difference shall be considered a part of the contract and be subject to a lien. But where the contractor’s statement, made as provided in Section 5, shows the amount to be paid to the sub-contractor, or party furnishing material, or the sub-contractor’s statement, made pursuant to Section 22, shows the amount to become due for material; or notice is given to the owner, as provided in Sections 24 and 25, and thereafter such sub-contract shall be performed, or material to the value of the amount named in such statements or notice, shall be prepared for use and delivery, or delivered without written protest on the part of the owner previous to such performance or delivery, or preparation for delivery, then, and in any of such cases, such sub-contractor or party furnishing or preparing material, regardless of the price named in the original contract, shall have a lien therefore to the extent of the amount named in such statements or notice. In case of default or abandonment by the contractor, the sub-contractor or party furnishing material, shall have and may enforce his lien to the same extent and in the same manner that the contractor may under conditions that arise as provided for in section 4 of this Act, and shall have and may exercise the same rights as are therein provided for the contractor.

Any provision in a contract, agreement, or understanding, when payment from a contractor to a subcontractor or supplier is conditioned upon receipt of the payment from any other party including a private or public owner, shall not be a defense by the party responsible for payment to a claim brought under Section 21, 22, 23, or 28 of this Act against the party. For the purpose of this Section, “contractor” also includes subcontractor or supplier. The provisions of Public Act 87-1180 shall be construed as declarative of existing law and not as a new enactment.

60/21.01 Willful Failure to Pay – Misdemeanor

Any contractor, or if the contractor is a corporation any officer or employee thereof, who with intent to defraud induces a subcontractor, as defined in Section 21, to execute and deliver a waiver of lien for the purpose of enabling the contractor to obtain final payment under his contract and upon the representation that the contractor will, from such final payment, pay the subcontractor the amount due the subcontractor, and who willfully fails to pay the subcontractor in full within 30 days after such final payment shall be guilty of a Class A misdemeanor.

60/21.02 Construction Funds Held in Trust Construction trust funds.

(a) Money held in trust; trustees. Any owner, contractor, subcontractor, or supplier of any tier who requests or requires the execution and delivery of a waiver of mechanics lien by any person who furnishes labor, services, or materials for the improvement of a lot or a tract of land in exchange for payment or the promise of payment, shall hold in trust the unpaid sums subject to the waiver of mechanics lien, as trustee for the person who furnished the labor, services, or materials.

(b) How trust moneys held; commingling. Nothing contained in this Section shall be construed as requiring moneys held in trust by an owner, contractor, subcontractor, or material supplier under this Section to be placed in a separate account. If an owner, contractor, subcontractor, or material supplier commingles moneys held in trust under this Section with other moneys, the mere commingling of the moneys does not constitute a violation of this Section.

(c) Violation of this Section. Any owner, contractor, subcontractor, or material supplier who knowingly retains or uses the moneys held in trust under this Section or any part thereof, for any purpose other than to pay those persons for whom the moneys are held in trust, shall be liable to any person who successfully enforces his or her rights under this Section for all damages sustained by that person.

60/22 Sub Subcontractors, Statement by Subcontractor

Whenever, after a contract has been made, the contractor shall associate one or more persons as partners or joint contractors, in carrying out the same, or any part thereof, the lien for materials or labor furnished by a subcontractor to such contractor and his partners or associates, as originally agreed upon, shall continue the same as if the subcontract had been made with all of said partners. When the contractor shall sub-let his contract or a specific portion thereof to a subcontractor, the party furnishing material to or performing labor for such subcontractor shall have a lien therefore; and may enforce his lien in the same manner as is herein provided for the enforcement of liens by subcontractors. Any subcontractor shall, as often as requested in writing by the owner, or contractor, or the agent of either, make out and give to such owner, contractor or agent, a statement of the persons furnishing material and labor, giving their names and how much, if anything, is due or to become due to each of them, and which statement shall be made under oath if required. If any subcontractor shall fail to furnish such statement within 5 days after such demand, he shall forfeit to such owner or contractor the sum of $50 for every offense, which may be recovered in a civil action, and shall have no right of action against either owner or contractor until he shall furnish such statement, and the lien of such subcontractor shall be subject to the liens of all other creditors.

60/23 Definitions, Public Projects, Notice of Claim, Lien Against Money or Bonds, Actions, Parties, Limitations, Liens of Persons Furnishing Work or Materials to Contractor, Notices, Limitations, Pleadings

Liens against public funds.

(a) For the purpose of this Section “contractor” includes any subcontractor; “State” includes any department, board or commission thereof, or other person financing and constructing any public improvements for the benefit of the State or any department, board or commission thereof; and “director” includes any chairman or president of any State department, board or commission, or the president or chief executive officer or such other person financing and constructing a public improvement for the benefit of the State.

(b) Any person who shall furnish material, apparatus, fixtures, machinery or labor to any contractor having a contract for public improvement for any county, township, school district, city, municipality or municipal corporation in this State, shall have a lien for the value thereof on the money, bonds, or warrants due or to become due the contractor having a contract with such county, township, school district, municipality or municipal corporation in this State under such contract. Provided, such person shall, before payment or delivery thereof is made to such contractor, notify the clerk or secretary, as the case may be, of the county, township, school district, city, municipality or municipal corporation of his claim by a written notice and furnish a copy of said notice at once to said contractor. The person claiming such lien may cause notification and written notice thereof to be given either by sending the written notice (by registered or certified mail, return receipt requested, with delivery limited to addressee only) to, or by delivering the written notice to the clerk or secretary, as the case may be, of the county, township, school district, city, municipality, or municipal corporation; and the copy of the written notice which the person claiming the lien is to furnish to the contractor may be sent to, or delivered to such contractor in like manner. And, provided further, that such lien shall attach only to that portion of such money, bonds, or warrants against which no voucher or other evidence of indebtedness has been issued and delivered to the contractor by or on behalf of the county, township, school district, city, municipality or municipal corporation as the case may be at the time of such notice. Provided further, that where such person has not so notified the clerk or secretary, as the case may be, of the county, township, school district, city, municipality or municipal corporation of his claim for a lien, upon written demand of the contractor with service by certified mail (return receipt requested) and with a copy filed with the clerk or secretary, as the case may be, that person shall, within 30 days, notify the clerk or secretary, as the case may be, of the county, township, school district, city, municipality or municipal corporation of his claim for a lien by either sending or delivering written notice in like manner as above provided for causing notification and written notice of a claim for lien to be given to such clerk or secretary, as the case may be, or the lien shall be forfeited. No official shall withhold from the contractor money, bonds, warrants, or funds on the basis of a lien forfeited as provided herein. The person so claiming a lien shall, within 90 days after giving such notice, commence proceedings by complaint for an accounting, making the contractor having a contract with the county, township, school district, city, municipality or municipal corporation and the contractor to whom such material, apparatus, fixtures, machinery or labor was furnished, parties defendant, and shall within the same period notify the clerk or secretary, as the case may be, of the county, township, school district, city, municipality or municipal corporation of the commencement of such suit by delivering to him or them a copy of the complaint filed. Failure to commence proceedings within 90 days after giving notice of lien pursuant to this subsection shall terminate the lien and no subsequent notice of lien may be given for the same claim nor may that claim be asserted in any proceedings pursuant to this Act. It shall be the duty of any such clerk or secretary, as the case may be, upon receipt of the first notice herein provided for to cause to be withheld a sufficient amount to pay such claim for the period limited for the filing of suit, unless otherwise notified by the person claiming the lien. Upon the expiration of this period the money, bonds or warrants so withheld shall be released for payment to the contractor unless the person claiming the lien shall have instituted proceedings and delivered to the clerk or secretary, as the case may be, of the county, township, school district, city, municipality or municipal corporation a copy of the complaint as herein provided, in which case, the amount claimed shall be withheld until the final adjudication of the suit is had. Provided, that the clerk or secretary, as the case may be, to whom a copy of the complaint is delivered as herein provided may pay over to the clerk of the court in which such suit is pending a sum sufficient to pay the amount claimed to abide the result of such suit and be distributed by the clerk according to the judgment rendered or other court order. Any payment so made to such claimant or to the clerk of the court shall be a credit on the contract price to be paid to such contractor.

(c) Any person who shall furnish material, apparatus, fixtures, machinery or labor to any contractor having a contract for public improvement for the State, may have a lien for the value thereof on the money, bonds or warrants due or about to become due the contractor having a contract with the State under the contract, by giving to the Director or other official, whose duty it is to let such contract, written notice of his claim for lien containing a sworn statement of the claim showing with particularity the several items and the amount claimed to be due on each. The claimant shall furnish a copy of said notice at once to the contractor. The person claiming such lien may cause such written notice with sworn statement of claim to be given either by sending such notice (by registered or certified mail, return receipt requested, with delivery limited to addressee only) to, or by delivering such notice to the Director or other official of the State whose duty it is to let such contract; and the copy of such notice which the person claiming the lien is to furnish to the contractor may be sent to, or delivered to such contractor in like manner.

However, the lien shall attach to only that portion of the money, bonds or warrants against which no voucher has been issued and delivered by the State. Provided, that where such person has not so notified the Director or other official of the State, whose duty it is to let such contract, of his claim for a lien, upon written demand of the contractor, with service by certified mail (return receipt requested) and with a copy filed with such Director or other official of the State, that person shall, within 30 days, notify the Director or other official of the State, whose duty it is to let such contract, of his claim for a lien by either sending or delivering written notice in like manner as above provided for giving written notice with sworn statement of claim to such Director or official, or the lien shall be forfeited. No public official shall withhold from the contractor money, bonds, warrants or funds on the basis of a lien forfeited as provided herein. The person so claiming a lien shall, within 90 days after giving such notice, commence proceedings by complaint for an accounting, making the contractor having a contract with the State and the contractor to whom such material, apparatus, fixtures, machinery or labor was furnished, parties defendant, and shall, within the same period notify the Director of the commencement of such suit by delivering to him a copy of the complaint filed; provided, if money appropriated by the General Assembly is to be used in connection with the construction of such public improvement, that suit shall be commenced and a copy of the complaint delivered to the Director not less than 15 days before the date when the appropriation from which such money is to be paid, will lapse. Failure to commence proceedings within 90 days after giving notice of lien pursuant to this subsection shall terminate the lien and no subsequent notice of lien may be given for the same claim nor may that claim be asserted in any proceedings pursuant to this Act. It shall be the duty of the Director, upon receipt of the written notice with sworn statement as herein provided, to withhold payment of a sum sufficient to pay the amount of such claim, for the period limited for the filing of suit, unless otherwise notified by the person claiming the lien. Upon the expiration of this period the money, bonds, or warrants so withheld shall be released for payment to the contractor unless the person claiming the lien shall have instituted proceedings and delivered to the Director a copy of the complaint as herein provided, in which case, the amount claimed shall be withheld until the final adjudication of the suit is had. Provided, the Director or other official may pay over to the clerk of the court in which such suit is pending, a sum sufficient to pay the amount claimed to abide the result of such suit and be distributed by the clerk according to the judgment rendered or other court order. Any payment so made to such claimant or to the clerk of the court shall be a credit on the contract price to be paid to such contractor.

(d) Any officer of the State, county, township, school district, city, municipality or municipal corporation violating the duty hereby imposed upon him shall be liable on his official bond to the claimant giving notice as provided in this Section for the damages resulting from such violation, which may be recovered in a civil action in the circuit court. There shall be no preference between the persons giving such notice, but all shall be paid pro rata in proportion to the amount due under their respective contracts.

60/24 Persons Furnishing Labor or Materials to Contractor, Notice of Claim to Owner, Service, Filing

Subcontractors, or party furnishing labor or materials, may at any time after making his or her contract with the contractor, and shall within 90 days after the completion thereof, or, if extra or additional work or material is delivered thereafter, within 90 days after the date of completion of such extra or additional work or final delivery of such extra or additional material, cause a written notice of his or her claim and the amount due or to become due thereunder, to be sent by registered or certified mail, with return receipt requested, and delivery limited to addressee only, to or personally served on the owner of record or his agent or architect, or the superintendent having charge of the building or improvement and to the lending agency, if known; however, if the lot or lots and tract or tracts of land in question are registered under the provisions of “An Act concerning land titles”, approved May 1, 1897, as amended, the notice shall not be served as above stated, but shall be filed in the office of the registrar of titles of the county in which such lot or lots and tract or tracts of land are situated, and such notice shall not be necessary when the sworn statement of the contractor or subcontractor provided for herein shall serve to give the owner notice of the amount due and to whom due, but where such statement is incorrect as to the amount, the subcontractor or material man named shall be protected to the extent of the amount named therein as due or to become due to him or her. For purposes of this Section, notice by registered or certified mail is considered served at the time of its mailing. The form of such notice may be as follows:

To (name of owner):

You are hereby notified that I have been employed by (the name of contractor) to (state here what was the contract or what was done, or to be done, or what the claim is for) under his or her contract with you, on your property at (here give substantial description of the property) and that there was due to me, or is to become due (as the case may be) therefore, the sum of $.____

Dated at.___this____day of _____ .

(Signature)

60/25 Notice to Non-Resident

In all cases where the owner, agent, architect or superintendent cannot, upon reasonable diligence, be found in the county in which said improvement is made, or shall not reside therein, the subcontractor or person furnishing materials, fixtures, apparatus, machinery, labor or services may give notice by filing in the office of the recorder against the person making the contract and the owner a claim for lien verified by the affidavit of himself, agent or employee, which shall consist of a brief statement of his contract or demand, and the balance due after allowing all credits, and a sufficient correct description of the lot, lots or tract of land to identify the same. An itemized account shall not be necessary.

60/26 Labor Liens Preferred

The claim of any person for wages as a laborer under section fifteen, twenty-one and twenty-two of this act shall be a preferred lien.

60/27 Owner to Withhold Money, Preferences

When the owner or his agent is notified as provided in this act, he shall retain from any money due or to become due the contractor, an amount sufficient to pay all demands that are or will become due such subcontractor, tradesman, materialmen, mechanic, or worker of whose claim he is notified, and shall pay over the same to the parties entitled thereto. Such payment shall be as follows:

First ¾ All claims for wages shall be paid in full.

Second ¾ The claims of tradesmen, materialmen and subcontractors, who are entitled to liens pro rata, in proportion to the amount due them respectively. All payments made as directed shall, as between such owner and contractor, be considered the same as if paid to such contractor. Any payment made by the owner to the contractor after such notice, without retaining sufficient money to pay such claims, shall be considered illegal and made in violation of the rights of the laborers and subcontractors and the rights of such laborers and subcontractors to a lien shall not be affected thereby, but the owner shall not be held liable to any laborer and subcontractor or other person whose name is omitted from the statement provided for in sections five (5) and twenty-two of this act, nor for any larger amount than the sum therein named as due such person (provided such omission is not made with the knowledge or collusion of the owner), unless previous thereto or to his payment to his contractor, he shall be notified, as herein provided, by such person of their claim and the true amount thereof.

Third ¾ The balance, if any, to the contractor.

60/28 Claim for Lien, Enforcement, Actions, Judgment

If any money due to the laborers, materialmen, or sub-contractors be not paid within 10 days after his notice is served as provided in sections 5, 24, 25, and 27, then such person may either file a claim for lien or file a complaint and enforce such lien within the same limits as to time and in such other manner as hereinbefore provided for the contractor in section 7 and sections 9 to 20 inclusive, of this Act, or he may sue the owner and contractor jointly for the amount due in the circuit court, and a personal judgment may be rendered therein, as in other cases. In such actions, as in suits to enforce the lien, the owner shall be liable to the plaintiff for no more than the pro rata share that such person would be entitled to with other sub-contractors out of the funds due to the contractor from the owner under the contract between them, except as hereinbefore provided for laborers and materialmen, and such action shall be maintained against the owner only in case the plaintiff establishes a right to the lien. All suits and actions by sub-contractors shall be against both contractor and owner jointly, and no judgment shall be rendered therein until both are duly brought before the court by process or publication, and such process may be served and publication made as to all persons except the owners as in other civil actions. All such judgments, where the lien is established shall be against both jointly, but shall be enforced against the owner only to the extent that he is liable under his contract as by this Act provided, and shall recite the date from which the lien thereof attached according to the provisions of Sections 1 to 20 of this Act; but this shall not preclude a judgment against the contractor, personally, where the lien is defeated.

60/30 Joinder of Parties, Prorata Distribution

If there are several liens under sections 21 and 22 of this Act upon the same premises, and the owner or any person having such a lien shall fear that there is not a sufficient amount coming to the contractor to pay all such liens, such owner or any one or more persons having such lien may file his, her or their complaint in the circuit court of the proper county, stating such fact and such other facts as may be sufficient to a full understanding of the rights of the parties. The contractor and all persons having liens upon or who are interested in the premises, so far as the same are known to or can be ascertained by the plaintiff, upon diligent inquiry shall be made parties. Upon the hearing the court shall find the amount due from the owner to the contractor, and the amount due to each of the persons having liens, and in case the amount found to be due to the contractor shall be insufficient to discharge all the liens in full, the amount so found in favor of the contractor shall be divided between the persons entitled to such liens pro rata after the payment of all claims for wages in proportion to the amounts so found to be due them respectively. If the amount so found to be due to the contractor shall be sufficient to pay the liens in full, the same shall be so ordered. The premises may be sold as in other cases under this Act. The parties to such action shall prosecute the same under like requirements as are directed in section 11 of this Act, and all persons who shall be duly notified of such proceedings, and who shall fail to prove their claims, whether the same be in judgment against the owner or not, shall forever lose the benefit of and be precluded from their liens and all claims against the owner. Upon the filing of such complaint the court may, on the motion of any person interested, and shall, upon final judgment stay further proceedings upon any action against the owner on account of such liens, and costs in such cases shall be adjusted as provided for in section 17 of this Act.

60/31 Failure to Complete Contract

Should the contractor, for any cause, fail to complete his or her contract, any person entitled to a lien under this Act may file a complaint against the owner and contractor, setting forth the nature of his or her claim, the amount due, as near as may be, and the names of the parties employed on such house or other improvement subject to liens; and a notice of such action shall be served on the persons therein named, and the parties shall have their claim adjudicated. The premises may be sold as in other cases under this act. The parties to such action shall prosecute the same under like requirements as are directed in section 11 of this Act.

60/32 Improper Payments by Owner

No payments to the contractor or to his order of any money or other considerations due or to become due to the contractor shall be regarded as rightfully made, as against the sub-contractor, laborer, or party furnishing labor or materials, if made by the owner without exercising and enforcing the rights and powers conferred upon him in sections 5, 21 and 22 of this Act.

60/34 Demand for Suit, Forfeiture

Upon written demand of the owner, lienor, or any person interested in the real estate, or their agent or attorney, served on the person claiming the lien, or his agent or attorney, requiring suit to be commenced to enforce the lien or answer to be filed in a pending suit, suit shall be commenced or answer filed within 30 days thereafter, or the lien shall be forfeited. Such service may be by registered or certified mail, return receipt requested, or by personal service.

60/35 Acknowledgment of Satisfaction, Recording, Release

Whenever a claim for lien has been filed with the recorder or the Registrar of Titles, either by the contractor or sub-contractor, and is paid before October 1, 1973, with cost of filing same, or where there is a failure to institute suit to enforce the same after demand, as provided in the preceding section, within the time by this Act limited, the person filing the same or some one by him duly authorized in writing so to do, shall acknowledge satisfaction or release thereof, in writing, on written demand of the owner, and on neglect to do so for 10 days after such written demand he shall be liable to the owner for the sum of $25, which may be recovered in a civil action. Such satisfaction or release may be filed with the recorder or Registrar of Titles in whose office the claim for lien had been filed and when so filed shall forever thereafter discharge and release the claim for lien and shall bar all actions brought or to be brought thereupon. Whenever a claim for lien has been filed with the recorder or the Registrar of Titles, either by the contractor or sub-contractor, and is paid after October 1, 1973, with cost of filing such claim for lien, the person filing the claim or someone by him duly authorized in writing so to do shall, upon receipt of the satisfaction of such claim deliver a release of lien in writing to the owner within 30 days after receipt of payment or shall be liable to the owner for the sum of $100 which may be recovered in a civil action. The release of lien shall have the following imprinted thereon in bold letters at least 1/4 inch in height:

“FOR THE PROTECTION OF THE OWNER, THIS RELEASE SHOULD BE FILED WITH THE RECORDER OR THE REGISTRAR OF TITLES IN WHOSE OFFICE THE CLAIM FOR LIEN WAS FILED.”

The Recorder or the Registrar of Titles in whose office the claim for lien had been filed, upon receipt of a release and the payment of the recording or registration fee, shall record or register the release.

60/36 Removal of Materials With Intent to Defraud, Misdemeanor

Any owner, contractor, sub-contractor or other person who shall purchase materials on credit and represent at the time of purchase that the same are to be used in a designated building or buildings, or other improvement, and shall thereafter sell, use or cause to be used the said materials in the construction of, or remove the same to any building or improvement other than that designated, or dispose of the same for any purpose, without the written consent of the person of whom the materials were purchased, with intent to defraud such person, shall be deemed guilty of a Class A misdemeanor.

60/37 Liens on Boats, Mobile Homes

Any architect, contractor, sub-contractor, materialman, or other person furnishing services, labor or material for the purpose of or in constructing, building, altering, repairing or ornamenting a boat, barge or other water craft or mobile home, shall have a lien on such boat, barge or other water craft or mobile home for the value of such services, labor or material in the same manner as in this act provided for services, labor or material furnished by such parties for the purpose of building, altering, repairing or ornamenting a house or other building. And such lien may be established and enforced in the same manner as liens are established and enforced under this act, and the parties shall be held to the same obligations, duties and liabilities as in case of a contract for building, altering, repairing or ornamenting a house or other building.

60/38 Recording, Indexing, Fees

When claims for lien are filed pursuant to the provisions of Sections 7, 25 and 28, the Recorder shall affix thereto a certificate of the date of filing the same, (similar to the certificate affixed to recorded instruments) and make an abstract thereof in a book kept for that purpose and properly indexed, containing the name of the person filing the lien, the amount of the lien, the date of filing, the name of the person against whom the lien is filed, and a description of the property charged with the lien, and if satisfied or released of record the date of filing said satisfaction or release. When a satisfaction or release is filed the Recorder shall affix a certificate of the date of filing similar to that affixed to the claim for lien. For filing a claim for lien and complying with the provisions of this act the recorder shall charge a fee of $12 for the first 4 pages thereof, plus $1 for each additional page thereof, plus $1 for each additional document number therein noted, and for filing a satisfaction or release thereof and affixing his certificate thereto he shall charge a fee of $12 for the first 4 pages thereof, plus $1 for each additional page thereof, plus $1 for each additional document number therein noted.

60/39 Liberal Construction

This act is and shall be liberally construed as a remedial act.