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Court Cannot Extend Mechanic’s Lien that had Expired by Operation of Law

New York Court Cannot Extend Mechanic’s Lien that had Expired

In a recent case decided in Supreme Court, New York County by Judge Laurence Love, Emerald Servs. Corp. v. Empire Core Group LLC, 2021 NY Slip Op 30394(U) (February 9, 2021)[1], the court was presented with the issue whether it could use Executive Order (EO) 202.8[2] to extend the statutory time limit on NY mechanic’s liens. EO 202.8 was issued during the COVID-19 pandemic.

Plaintiff, Emerald Servs. Corp. (Emerald), filed four mechanic’s liens on four properties in New York City on December 24, 2019. Emerald (lienor) sought to foreclose on these four liens by filing a summons and complaint on June 25, 2020. Emerald did not file a notice of pendency for the liens, nor file for an extension of the liens before December 24, 2020.

Under New York Lien Law § 17, mechanic’s liens are valid for one year from filing (statutory period). The filing of both a foreclosure action and a notice of pendency will automatically extend the lien. Failure to file a notice of pendency will cause a lien to expire after the one year has lapsed regardless of the foreclosure action’s status.

Emerald filed its summons and complaint only June 25, 2020 and did nothing else on the liens. Defense counsel simply waited until the statutory period expired; then, on January 7, 2021, the defendants moved to dismiss the complaint for failure to state a cause of action and discharging liens under Lien Law § 17 because the liens had expired by law.[3]

Emerald then cross-moved for an order extending the liens nunc pro tunc.[4] Generally, a court does not have the discretionary power to extend the statutory period unless the lienor applies before the period expires.[5] In the alternative, Emerald argued that it was entitled to a toll of the applicable statutory time-period under EO 202.8.

However, EO 202.8 was superseded by EO 202.67, which extended the suspension of tolling periods for civil cases only until November 3, 2020. Since Emerald’s request for an extension of the liens was made after November 3, 2020, the court ruled they could not grant it upon those grounds. The court also noted that Emerald failed to file a notice of pendency with the complaint. The court held it lacked the power to extend the mechanic’s liens that had expired by operation of law according to Lien Law § 17. Defendants’ motion to dismiss was granted.

At Yoars Law, we focus on being proactive business and legal advisors for our construction clients, guiding them through the complex legal issues as they arise, and being zealot advocates when needed. We also provide transparent and predictable legal fees so our clients can consistently manage their budgets.

[1] The Decision & Order can be found here.

[2] EO 202.8 states: “In accordance with the directive of the Chief Judge of the State to limit court operations to essential matters during the pendency of the COVID-19 health crisis, any specific time limit for the commencement, filing, or service of any legal action, notice, motion, or other process or proceeding, as prescribed by the procedural laws of the state, including but not limited to the criminal procedure law, the family court act, the civil practice law and rules, the court of claims act, the surrogate’s court procedure act, and the uniform court acts, or by any other statute, local law, ordinance, order, rule, or regulation, or part thereof, is hereby tolled from the date of this executive order until April 19, 2020.”

[3] The requirements of Lien Law § 17 are not satisfied where the lienor only commences an action within the year but fails to file a notice of pendency. See Aztec Window & Door Mfg., Inc. v. 71 Vill. Rd., LLC, 60 AD3d 795 (2d Dept. 2009).

[4] Nunc pro tunc. Adj. Latin for “now for then.” A phrase applied to acts allowed to be done after the time when they should be done, with a retroactive effect, i. e., with the same effect as if regularly done. See Black’s Free Law Dictionary online.

[5] Emerald Servs. Corp. v. Empire Core Grp. LLC, 2021 NY Slip Op 30394(U), ¶ 2 (Sup. Ct.).

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