How to Dispute a Mechanic’s Lien Filed Against Your Home in Colorado
When a subcontractor, supplier, or laborer records a mechanic’s lien against your Colorado home, it can derail a sale, block refinancing, and expose you to foreclosure. Yet under Article 22 of Title 38 of the Colorado Revised Statutes, homeowners have clear statutory defenses and procedures to dispute or remove improper liens. This comprehensive guide walks you through every step—from reviewing your payment records and asserting statutory payment defenses to posting a substitution bond and challenging defective liens in court—so you can clear your title and protect your investment.
Understanding the Basis for Disputing a Mechanic’s Lien
Before challenging a lien, you must understand that Colorado law grants lien rights broadly to “persons furnishing labor, materials, or professional services” for property improvements. However, once you can show full payment to your prime contractor or expose procedural defects—such as failure to serve the required Notice of Intent or timely record the lien statement—you gain powerful grounds to dispute or vacate the lien under C.R.S. § 38‑22‑102.
1. Review Your Contracts and Payment Records
Begin by gathering every contract, change order, invoice, and proof of payment related to your project. Verify that your general contractor has been paid in full, including all approved change orders. If you find that you have satisfied the prime contract price, Colorado law provides an absolute defense: subcontractors and suppliers cannot enforce a lien against you once the general contractor is fully paid. This affirmative defense is codified in C.R.S. § 38‑22‑102(3.5), which bars subordinate lien claims when the owner’s payment obligations are met.
2. Assert the Section 38‑22‑102 Defense
If your records confirm full payment, your next move is to send a written Notice of Defense to the lien claimant and the county clerk. In your notice, cite C.R.S. § 38‑22‑102, state that the prime contract has been paid in full, and demand immediate release of the lien. Many lienholders will withdraw their claim once confronted with this statutory bar, especially when facing the potential for a court‑awarded fee shifting to the prevailing homeowner.
3. File a Bonding Action Under C.R.S. § 38‑22‑131
When payment defenses fail or do not apply—such as when you legitimately owe part of the contract price—Colorado law allows you to “bond around” the lien. By posting a Substitution Bond for at least 150 percent of the lien amount (plus court costs), approved by a district court judge, you substitute the bond for the lien and clear your title immediately while the underlying dispute proceeds in court. The bonding procedure is governed by C.R.S. § 38‑22‑131 and typically concludes within weeks, enabling swift refinancing or sale.
4. Challenge Procedural Defects in Court
Even if full payment or bonding is not an option, you can file a lawsuit to vacate a lien based on procedural irregularities. Common defects include failure to serve the required Notice of Intent at least ten days before recording the lien statement (see C.R.S. § 38‑22‑109(3)), recording after the four‑month deadline (C.R.S. § 38‑22‑109(5)), or inaccuracies in the lien statement’s property description or amount claimed. Your petition should identify each defect, request vacatur of the lien, and seek attorney’s fees and costs under the statute.
5. Work with Experienced Counsel and Title Companies
Disputing a mechanic’s lien often requires coordinating with your title company to issue a “conditional” title policy while the lien remains bonded or under litigation. Engaging a construction‑law attorney early ensures that notices, bond filings, and court pleadings comply with each statutory deadline and procedural rule, avoiding missteps that could waive your defenses.
Conclusion and Next Steps
Disputing a mechanic’s lien against your Colorado home demands a methodical approach: audit your payment records, assert your C.R.S. § 38‑22‑102 defense, bond around the lien if necessary, and litigate any procedural flaws. By leveraging these statutes—particularly Sections 38‑22‑102 and 38‑22‑131—you can clear your title and move forward with confidence. For complex disputes or looming deadlines, consult experienced counsel immediately to protect your investment and secure a lien‑free future.
The information provided on this website is for general informational purposes only and should not be construed as legal advice or legal opinion. You should not act or refrain from acting on the basis of any information provided on this website without seeking legal advice from an attorney.