Mechanics Lien Exaggeration: Grounds to Dismiss a Lawsuit in New York?

Mechanics Lien Exaggeration: Grounds to Dismiss a Lawsuit in New York? By Elliot Singer on March 24, 2013 Summary Judgment: An Introduction Most people think that if a lawsuit proceeds to trial, there’s only one opportunity to win or lose: When a jury issues a verdict. In civil trials, however, this scheme isn’t always true. Let’s say that you’re a property owner and that a subcontractor who performed work on your home filed a mechanics lien on the property and then sued to foreclose on it. As the property owner, however, you’re frustrated. Not only did you actually pay the subcontractor for the work he performed (and can document it), even if you didn’t pay him, the amount he claims that he is owed is much more than the two of you ever agreed upon. This is called lien exaggeration (a topic previously discussed on the PAID blog). Perhaps he’s saying that he’s owed $40,000 on a $10,000 kitchen installation. In civil trials, the plaintiff (the party that files the lawsuit) is permitted to make its case first. In doing so, the plaintiff may make an opening statement, call favorable witnesses, and introduce supporting exhibits. But what happens if the plaintiff’s case is so weak that there’s no way a jury could ever find in the plaintiff’s favor? Courts don’t like to waste time, so if the defendant believes that “no reasonable juror” could conclude that the plaintiff should win, even if the defendant doesn’t make its case. The defendant will do something called “moving for summary judgment.” In essence, the defendant is saying to the judge that since the plaintiff hasn’t presented enough evidence to win, the court should dismiss the lawsuit before the defendant presents any of its own evidence. This is actually a fairly common request. Summary Judgment for Lien Exaggeration Going back to our example above, are you, the defendant and property owner entitled to summary judgment in New York if you can show that the plaintiff and subcontractor who claims that he is owed $40,000 exaggerated the amount he is claiming in the lien? A recent case decided on March 14, 2013, On the Level Enterprises v. 49 East Houston, L.L.C., addressed this exact issue. Although it is short, the court’s opinion is actually rich in clarification of the law. Specifically, the court held that while it is possible for courts to issue summary judgment against plaintiffs who file exaggerated liens, in this case, summary judgment would be inappropriate.