Legal Update: Using Mechanics’ Liens to Fund Unpaid Employer ContributionsBondBeebe
Posting by Larry Beebe, CPA
A Pennsylvania Superior Court, in a 7-2 decision, ruled that benefit fund trustees have the right to file mechanics’ lien claims for unpaid fringe benefit contributions. The court ruled that unions were subcontractors who had agreed to furnish labor to the contractor and as subcontractors they had the right to file mechanic’s lien claims for unpaid employer contributions (Bricklayers of Western Pennsylvania Combined Funds Inc. v. Scott’s Development Co., PA. Super. Ct., No. 687 WDA 2012, 1-6-12).
Trustees should check with their counsel to determine if mechanics’ lien claims could be a collection tool for their funds.