Any contractor, subcontractor, or supplier who provides work, services, material or equipment pursuant to a contract, shall be entitled to a lien for the value of work or services performed, or materials or equipment furnished in accordance with the contract and based upon the contract price, subject to the provisions of sections 9 and 10 of this act. The lien shall attach to the interest of the owner of real property. If a tenant contract for improvement of the real property
On June 18, 2007 -- for the first time in the 13 years since the New Jersey Construction Lien Law was amended -- the Appellate Division has provided analysis of what the statutory term "authorized in writing by the owner" means.
In 1994, New Jersey's Mechanic's Lien Law was repealed and replaced with the Construction Lien Law. Because Construction Lien Claims are statutory in origin, the procedural requirements of the statute are strictly construed by the courts. While the Construction Lien Law clearly states, "[if] a tenant contract for improvement of the real property and the contract for improvement has not been authorized in writing by the owner of a fee simple interest in the improved real property, the lien shall attach only to the leasehold interest of the tenant", the meaning of "authorized in writing" was not been interpreted by the courts until
For a construction lien to attach to the owner's property, the old Mechanic's Lien Law (prior to 1994) provided: When a building is altered or repaired or added to by a tenant or by a person other than the owner of the land which it is erected, only the estate of the tenant or person so altering, repairing or adding to such a building shall be subject to the lien created by this article, unless such alteration, repair or addition is made with written consent of the owner of such land. N.J.S.A. 2A:44-68.
In other words, the standard under the prior statute was that a lien could attach to the fee simple interest of the owner if the owner consented to the work being performed. If the owner had not consented, the lien could only be filed against the leasehold interest of the tenant.
Under the Construction Lien Law, effective in 1994, for a construction lien to attach to the owner's property, the owner's consent is no longer sufficient. Rather, the owner must now give written authorization of the contract for improvement. N.J.S.A. 2A:44A-3. The statute specifically states:
If a tenant contracts for improvement of the real property and the contract for improvement has not been authorized in writing by the owner of a fee simple interest in the improved real property, the lien shall only attach to the leasehold interest of the tenant.
Nowhere in the Construction Lien Law, N.J.S.A. 2A:44A-1 et. seq., is written authorization defined; thus neither guidance nor legal protection is provided to the contractor.