Bill Text: MI SB0140 | 2009-2010 | 95th Legislature | Introduced

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Bill Title: Liens; construction; construction liens on government property; allow. Amends sec. 107 of 1980 PA 497 (MCL 570.1107).

Spectrum: Moderate Partisan Bill (Democrat 4-1)

Status: (Introduced - Dead) 2009-01-29 - Referred To Committee On Economic Development And Regulatory Reform [SB0140 Detail]

Download: Michigan-2009-SB0140-Introduced.html

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SENATE BILL No. 140

 

 

January 29, 2009, Introduced by Senators OLSHOVE, ANDERSON, CHERRY, CLARK-COLEMAN and GARCIA and referred to the Committee on Economic Development and Regulatory Reform.

 

 

 

     A bill to amend 1980 PA 497, entitled

 

"Construction lien act,"

 

by amending section 107 (MCL 570.1107), as amended by 2006 PA 497.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

     Sec. 107. (1) Each contractor, subcontractor, supplier, or

 

laborer who provides an improvement to real property has a

 

construction lien upon the interest of the owner or lessee who

 

contracted for the improvement to the real property, as described

 

in the notice of commencement given under section 108 or 108a, the

 

interest of an owner who has subordinated his or her interest to

 

the mortgage for the improvement of the real property, and the

 

interest of an owner who has required the improvement. A

 

construction lien acquired pursuant to this act shall not exceed

 

the amount of the lien claimant's contract less payments made on

 

the contract.

 

     (2) A construction lien under this act attaches to the entire

 

interest of the owner or lessee who contracted for the improvement,

 

including any subsequently acquired legal or equitable interest.

 

     (3) Each contractor, subcontractor, supplier, or laborer who

 

provides an improvement to real property to which the person

 

contracting for the improvement had no legal title has a

 

construction lien upon the improvement for which the contractor,

 

subcontractor, supplier, or laborer provided labor, material, or

 

equipment. The forfeiture, surrender, or termination of any title

 

or interest held by an owner or lessee who contracted for an

 

improvement to the property, an owner who subordinated his or her

 

interest to the mortgage for the improvement, or an owner who has

 

required the improvement does not defeat the lien of the

 

contractor, subcontractor, supplier, or laborer upon the

 

improvement.

 

     (4) If the rights of a person contracting for an improvement

 

as a land contract vendee or a lessee are forfeited, surrendered,

 

or otherwise terminated, any lien claimant who has provided a

 

notice of furnishing or is excused from providing a notice of

 

furnishing under section 108, 108a, or 109 and who performs the

 

covenants contained in the land contract or lease within 30 days

 

after receiving actual notice of the forfeiture, surrender, or

 

termination is subrogated to the rights of the contracting vendee

 

or lessee as those rights existed immediately before the

 

forfeiture, surrender, or termination.

 

     (5) For purposes of this act, if the real property is owned or

 

leased by more than 1 person, there is a rebuttable presumption

 

that an improvement to real property under a contract with an owner

 

or lessee was consented to by any other co-owner or co-lessee. If

 

enforcement of a construction lien through foreclosure is sought

 

and the court finds that the improvement was consented to by a co-

 

owner or co-lessee who did not contract for the improvement, the

 

court shall order the entire interest of that co-owner or co-

 

lessee, including any subsequently acquired legal or equitable

 

interest, to be subject to the construction lien. A deficiency

 

judgment shall not be entered against a noncontracting owner, co-

 

owner, lessee, or co-lessee.

 

     (6) If the real property of an owner or lessee is subject to

 

multiple construction liens, the sum of the construction liens

 

shall not exceed the amount the owner or lessee agreed to pay the

 

person with whom he or she contracted for the improvement as

 

modified by all additions, deletions, and other amendments, less

 

payments made by or on behalf of the owner or lessee, pursuant to

 

either a contractor's sworn statement or a waiver of lien, in

 

accordance with this act.

 

     (7) Real property owned or leased by a governmental entity or

 

as to which a governmental entity contracts for an improvement is

 

subject to a construction lien under this act to the same extent as

 

other real property.

 

     (8) (7) After the effective date of the amendatory act that

 

added this subsection January 3, 2007, a construction lien of a

 

subcontractor or supplier for an improvement to a residential

 

structure shall only include an amount for interest, including, but

 

not limited to, a time-price differential or a finance charge, if

 

the amount is in accordance with the terms of the contract between

 

the subcontractor or supplier and the contractor or subcontractor

 

and does not include any interest that accrues after 90 days after

 

the claim of lien is recorded.