BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                  AB 456
                                                                  Page  1

          Date of Hearing:   September 9, 2011

                           ASSEMBLY COMMITTEE ON JUDICIARY
                                  Mike Feuer, Chair
                   AB 456 (Wagner) - As Amended:  September 2, 2011

                                   FOR CONCURRENCE
           
          SUBJECT  :  MECHANICS LIENS

           KEY ISSUE  :  SHOULD THE AFFIDAVIT FOR SERVICE OF A MECHANICS LIEN 
          BE CLARIFIED TO MORE CLOSELY REFLECT THE MANNER OF SERVICE?

                                      SYNOPSIS

          Mechanics lien claims are required to be served upon the owner 
          or reputed owner of the property, and the statute specifies the 
          manner of service when the owner or reputed owner resides within 
          or outside the state.  If the owner or reputed owner cannot be 
          served by that method, the statute allows notice to be given as 
          prescribed to the construction lender or to the
          original contractor.  In either event, an affidavit of service 
          must be executed in order for the claim to be enforceable.  This 
          bill clarifies the language of the statute regarding this 
          affidavit so that it better conforms to the statute regarding 
          the method of service and to avoid confusion and inadvertent 
          error.  There is no known opposition.
           
          SUMMARY  :  Clarifies the procedure for mechanics liens claims.  
          Specifically,  this bill  clarifies that mechanics lien claimants 
          in construction disputes shall specify in the required affidavit 
          indicating service of the notice of mechanics lien that the 
          notice was served on the owner or reputed owner of the property, 
          consistently with existing obligations regarding service of 
          these claims.

           FISCAL EFFECT  :  None

           COMMENTS :  According to the author, existing law requires that a 
          mechanics lien and the accompanying Proof of Service Affidavit 
          be served on an owner or reputed owner by registered mail, 
          certified mail, or first-class mail, evidenced by a certificate 
          of mailing, postage prepaid, addressed to the owner or reputed 
          owner at the owner's or reputed owner's residence or place of 
          business address or at the address shown by the building permit 








                                                                  AB 456
                                                                  Page  2

          on file.  The author notes that this bill would provide 
          clarification and consistency to ensure that, if the owner or 
          reputed owner is listed in the Proof of Service Affidavit, there 
          would not be the opportunity to invalidate the lien based on a 
          minor error in the name, part of the name or title.

          According to supporters:

               Passage of this measure is critical, because it makes an 
               important clarifying change to existing law that, if left 
               unchanged, could result in mechanics liens being 
               invalidated due to very minor errors.  . . . Throughout the 
               Civil Code Sections 3084 and Ý8]146, and in the mechanic's 
               (sic) lien itself, it requires the name of the owner or 
               reputed owner while in the Proof of Service Affidavit it 
               requires the name and title of the person served.  In a 
               day-to-day application of this new law those who are 
               preparing the mechanic's lien, and the Proof of Service 
               Affidavit that is now required, often do not know or have 
               access to accurate information regarding the specific name 
               and title of a person to be listed on the Proof of Service 
               Affidavit, which is now part of the mechanic's lien.  This 
               is true particularly when the property is owned by a 
               business organization.  This creates a large problem 
               because the new statuÝt]e states that:  "Failure to serve 
               the mechanic's lien, including the notice of mechanic's 
               lien, as prescribed by this section, shall cause the 
               mechanic's lien to be unenforceable as a matter of law."  

               AB 456 is a simple amendment to the new statute to insert 
               "owner or reputed owner" where the current statute 
               specifies "person or personsÝ,"] and in doing so, provides 
               clarification and consistency in the code to ensure that, 
               if the owner or reputed owner is listed in the Proof of 
               Service Affidavit, then there Ýwould not] be the 
               opportunity to invalidate the lien based on a minor error 
               in name, part of the name, or title.   

          Thus, supporters argue, this bill makes an important clarifying 
          change to existing law that, if left unchanged, could result in 
          mechanics liens being invalidated due to very minor errors.  

           REGISTERED SUPPORT / OPPOSITION  :   

           Support 








                                                                 AB 456
                                                                  Page  3

           
          Air Conditioning and Refrigeration Contractors Association
          Air Conditioning and Sheet Metal Association
          Building Industry Credit Association
          California Chapter of the American Fence Association
          California Chapters of the National Electrical Contractors 
          Association
          California Fence Contractors' Association
          California Landscape and Irrigation Council
          California Legislative Conference of the Plumbing, Heating, and 
          Piping Industry
          Construction Industry Force Account Council
          Engineering Contractors' Association
          Flasher Barricade Association
          Marin Builders' Association

           Opposition 
           
          None on file
           

          Analysis Prepared by  :    Kevin G. Baker / JUD. / (916) 319-2334