Leo Hubbard Explains Advantages of Liens And Changes in New Lien Law

On September 22, the nerv California Mechanics Lien Larv went into effect. On the follorving \\rednesday, September 26, Mr. Leo Hubbard, secretary of the Hayward Lumber & Investment Company, of Los Angeles, appeared before the semi-annual conference of the Southern Cali{ornia Retail Lumber Association, and spent more than two hours explaining in detail the r,vorkings of the new Lien 131ar, and also explaining in great detail the entire subject of lien larv use for the California retail lumber trade. He replied to innumerable questions, and showed amazing familiarity with every phase of the lien law situation. His program won high praise from those who heard him.

To begin t'ith he stated that the following are the advantages a lien la11' gives the lumber dealer:

A lien is the t nlv instrument provided bv law that will protect your account rvithout the signature of the owner. It gives a certain amount of security (depending on prior encumbrances) to the dealer for materials purchased by contractor, sub-contractor, olner, person purchasing on contract of sale, and lessee.

A lien is the only instrurnent, if recorded rvithin the proper time after a job is completed, rvhich takes effect from tl-re time of the beginning of the job. It is retroactive to the beginning of the job.

A lien filed properly rvill be a prior encumbrance to any mortgage or trust deed recorded after the job has started unless the materialman knen' of some unrecorded encumbrance.

A11 liens are equal.

Most property is in joint tenar-rcy lvith husband ancl rvife. If the husband l.ras purchased materials from you, a lien protects a dealer against the property going free and clear to the u'ife in joint tenancy in case of death of husband.

A lien protects a dealer if a homestead is filed b1, the owner regardless of rvhen the homestead is or was filecl.

A lien protects a dealer against bankruptcy of either the contractoi or otvner_

A lien is gooci security against the building even if the dealer is not aware of the actual orvnership.

A lien is the only protection against a contractor rvho has received all of his rnoney and who has failed to pay the dealer.

On a bonded job for a private party (not public) a lien is the best security in case the surety is no good at the time judgment is given. On a bonded private job a lien or proper notice to bonding company is essential.

A lien on the building is the only security that a dealer has in case a notice of non-responsibility is properly filed on the property.

A lien is the only actual protection outside of a written guarantee from the lending institution that the last payment after Notice of Completion time has expired tvill be paid to the lien claimants.

A lien is the only security that the dealer has on the money in the building fund that is left in the lending institution's hands after the lien period has expired if any other liens are filed. An order on the loan will be paid only out of funds left after lien clairns have been paid unless guaranteed by lending institution.

A lien is the only protection that a dealer has if someone attaches the building fund.

One big advantage is that it n,ill let the contractor or owl-ler do most of the u'orrying and r,r'ill save the dealcr a good many gray hairs.

IIar.ing stated these general advantages that a lien properly executed gives the lumber dcaler, Mr. Hubltard thcn took up and discussed in turn the following subjects: delivery procedure, loading tickets, sales tickets; bonds on Iiedcr:rl jobs, and also on private and public jobs; what is lienable under the law; what has prioritv; notice of completion; description of property covered by lien; foreclosure or extension; lien time for materialmen; keeping track of lien dates; exercise of care in selling building materials.

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