Signed Contracts Are the Only Path to Support Mechanic’s Liens

The importance of Massachusetts contractors and material suppliers having signed written agreement with their customers before supplying any labor/materials was recently highlighted by the Massachusetts Appellate Division in Petrucelli v. Barrios.

In Petrucelli v. Barrios, Petrucelli, a general contractor, was hired by Barrios (property owner) to reconstruct a property in Lynn that had been damaged by fire. The general contractor submitted three written proposals totaling $68,000 to Barrios. The general contractor never had Barrios sign any of the proposals. The general contractor commenced work and received a partial payment. Suddenly, a dispute arose between the general contractor and the customer leaving the general contractor with a $12,000.00 receivable for work completed on the project.

When the parties failed to reach an agreement, the general contractor filed a mechanic’s lien. Eventually, the matter was tried before a judge in Lynn District Court. At trial, the Court granted judgment in favor of the general contractor on its breach of contract claim. However, the District Court dissolved the general contractor’s mechanic’s lien claim finding that the unsigned written proposals failed to satisfy the written contract requirement of the Massachusetts mechanic’s lien statute.

The general contractor appealed the decision and the Massachusetts Appellate Division upheld the District Court’s findings. The Appellate Division ruled that in order to meet the written contract requirement of the Massachusetts mechanic’s lien statute the contract or proposal must be signed by the party accepting the labor/materials. In this case that party was Barrios.

The Petrucelli case does not appear to disturb Harris v. Moynihan Lumber of Beverly, a 1999, Massachusetts Court of Appeals decision wherein the Court held that a material supplier can satisfy its written contract requirement under the Massachusetts mechanic’s lien statute by producing a signed credit agreement by its customer along with invoices and delivery tickets describing the materials supplied to the project.

Even so, Petrucelli is a critical reminder for contractors and material suppliers to have signed written agreements with their customers before supplying any labor/materials. As mechanic’s liens are always a preferred method of having security in the collection of any receivable and it is certainly worth double checking for a signed written agreement prior to commencing any project.

Contact an experienced construction attorney at the Law Offices of Richard Mucci if you have questions about mechanic’s liens or construction contracts.