Lien Update: A Supplier can Perfect a Lien for Materials Delivered but not Incorporated into the Work

February 10, 2015

The Dallas Court of Appeals recently held a supplier can "perfect" a lien for materials ordered and delivered to a job, even if those materials were not incorporated into the work. Despite the lack of incorporation into the work, the Court found the materials were “furnished” to the project, as defined by the Texas Mechanic’s Lien Statute.  

 

In Addison Urban Dev. Partners, LLC v. Alan Ritchey Materials Co., LCC, a concrete contractor ordered concrete sand and rock gravel from supplier specifically for a private construction project. Ultimately, the quantity of material ordered from and supplied by the supplier exceeded the amount required for the job by nearly four times. After demands for payment were not met, the supplier sent notices and filed its lien. The owner contended that the lien was not perfected for the unused concrete sand and rock gravel. 

 

The Court disagreed and found in favor of the supplier. Relying upon case law for guidance, the Court held that the Texas Mechanic’s Lien Statute does not define “furnish” as requiring “the materials actually enter into the construction of the improvement.” 

 

It is important to note that in this case, it was undisputed that the materials were specifically ordered for the project and actually delivered to the concrete contractor. Moreover, there was no evidence that the materials were used on another job. The Court distinguished the present case from a previous opinion in which a lien was rejected when the facts of material orders and actual delivery were hotly contested.  

 

Take Away: The outcome in this case could have been different if the Supplier was asserting a payment bond claim on a public project. In those cases, courts often interpret the Texas Payment Bond Statute to require a supplier to prove the materials were actually incorporated into the construction project.

 

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