Mechanic's liens; persons to whom available; effect of contract
provisions; credit transactions; restrictions
Sec. 1. (a) A contractor, a subcontractor, a mechanic, a lessor
leasing construction and other equipment and tools, whether or not
an operator is also provided by the lessor, a journeyman, a laborer,
or any other person performing labor or furnishing materials or
machinery, including the leasing of equipment or tools, for:
(1) the erection, alteration, repair, or removal of:
(A) a house, mill, manufactory, or other building; or
(B) a bridge, reservoir, system of waterworks, or other
structure;
(2) the construction, alteration, repair, or removal of a walk or
sidewalk located on the land or bordering the land, a stile, a
well, a drain, a drainage ditch, a sewer, or a cistern; or
(3) any other earth moving operation;
may have a lien as set forth in this section.
(b) A person described in subsection (a) may have a lien
separately or jointly upon the:
(1) house, mill, manufactory, or other building, bridge,
reservoir, system of waterworks, or other structure, sidewalk,
walk, stile, well, drain, drainage ditch, sewer, cistern, or earth:
(A) that the person erected, altered, repaired, moved, or
removed; or
(B) for which the person furnished materials or machinery of
any description; and
(2) on the interest of the owner of the lot or parcel of land:
(A) on which the structure or improvement stands; or
(B) with which the structure or improvement is connected;
to the extent of the value of any labor done or the material furnished,
or both, including any use of the leased equipment and tools.
(c) All claims for wages of mechanics and laborers employed in
or about a shop, mill, wareroom, storeroom, manufactory or
structure, bridge, reservoir, system of waterworks or other structure,
sidewalk, walk, stile, well, drain, drainage ditch, cistern, or any other
earth moving operation shall be a lien on all the:
(1) machinery;
(2) tools;
(3) stock;
(4) material; or
(5) finished or unfinished work;
located in or about the shop, mill, wareroom, storeroom, manufactory
or other building, bridge, reservoir, system of waterworks, or other
structure, sidewalk, walk, stile, well, drain, drainage ditch, sewer,
cistern, or earth used in a business.
(d) If the person, firm, limited liability company, or corporation
described in subsection (a) is in failing circumstances, the claims
described in this section shall be preferred debts whether a claim or
notice of lien has been filed.
(e) Subject to subsection (f), a contract:
(1) for the construction, alteration, or repair of a Class 2
structure (as defined in IC 22-12-1-5);
(2) for the construction, alteration, or repair of an improvement
on the same real estate auxiliary to a Class 2 structure (as
defined in IC 22-12-1-5);
(3) for the construction, alteration, or repair of property that is:
(A) owned, operated, managed, or controlled by a:
(i) public utility (as defined in IC 8-1-2-1);
(ii) municipally owned utility (as defined in IC 8-1-2-1);
(iii) joint agency (as defined in IC 8-1-2.2-2);
(iv) rural electric membership corporation formed under
IC 8-1-13-4;
(v) rural telephone cooperative corporation formed under
IC 8-1-17; or
(vi) not-for-profit utility (as defined in IC 8-1-2-125);
regulated under IC 8; and
(B) intended to be used and useful for the production,
transmission, delivery, or furnishing of heat, light, water,
telecommunications services, or power to the public; or
(4) to prepare property for Class 2 residential construction;
may include a provision or stipulation in the contract of the owner
and principal contractor that a lien may not attach to the real estate,
building, structure or any other improvement of the owner.
(f) A contract containing a provision or stipulation described in
subsection (e) must meet the requirements of this subsection to be
valid against subcontractors, mechanics, journeymen, laborers, or
persons performing labor upon or furnishing materials or machinery
for the property or improvement of the owner. The contract must:
(1) be in writing;
(2) contain specific reference by legal description of the real
estate to be improved;
(3) be acknowledged as provided in the case of deeds; and
(4) be filed and recorded in the recorder's office of the county
in which the real estate, building, structure, or other
improvement is situated not more than five (5) days after the
date of execution of the contract.
A contract containing a provision or stipulation described in
subsection (e) does not affect a lien for labor, material, or machinery
supplied before the filing of the contract with the recorder.
(g) Upon the filing of a contract under subsection (f), the recorder
shall:
(1) record the contract at length in the order of the time it was
received in books provided by the recorder for that purpose;
(2) index the contract in the name of the:
(A) contractor; and
(B) owner;
in books kept for that purpose; and
(3) collect a fee for recording the contract as is provided for the
recording of deeds and mortgages.
(h) A person, firm, partnership, limited liability company, or
corporation that sells or furnishes on credit any material, labor, or
machinery for the alteration or repair of an owner occupied single or
double family dwelling or the appurtenances or additions to the
dwelling to:
(1) a contractor, subcontractor, mechanic; or
(2) anyone other than the occupying owner or the owner's legal
representative;
must furnish to the occupying owner of the parcel of land where the
material, labor, or machinery is delivered a written notice of the
delivery or work and of the existence of lien rights not later than
thirty (30) days after the date of first delivery or labor performed.
The furnishing of the notice is a condition precedent to the right of
acquiring a lien upon the lot or parcel of land or the improvement on
the lot or parcel of land.
(i) A person, firm, partnership, limited liability company, or
corporation that sells or furnishes on credit material, labor, or
machinery for the original construction of a single or double family
dwelling for the intended occupancy of the owner upon whose real
estate the construction takes place to a contractor, subcontractor,
mechanic, or anyone other than the owner or the owner's legal
representatives must:
(1) furnish the owner of the real estate:
(A) as named in the latest entry in the transfer books
described in IC 6-1.1-5-4 of the county auditor; or
(B) if IC 6-1.1-5-9 applies, as named in the transfer books of
the township assessor;
with a written notice of the delivery or labor and the existence
of lien rights not later than sixty (60) days after the date of the
first delivery or labor performed; and
(2) file a copy of the written notice in the recorder's office of
the county not later than sixty (60) days after the date of the
first delivery or labor performed.
The furnishing and filing of the notice is a condition precedent to the
right of acquiring a lien upon the real estate or upon the improvement
constructed on the real estate.
(j) A lien for material or labor in original construction does not
attach to real estate purchased by an innocent purchaser for value
without notice of a single or double family dwelling for occupancy
by the purchaser unless notice of intention to hold the lien is
recorded under section 3 of this chapter before recording the deed by
which the purchaser takes title.
As added by P.L.2-2002, SEC.13. Amended by P.L.101-2002, SEC.5;
P.L.151-2003, SEC.1.
Last modified: May 24, 2006