§ 49-37 — Dissolution of mechanic's lien by substitution of bond. Joinder of actions on claim and bond.

Connecticut § 49-37

• Jurisdiction: Connecticut
• Title 49: Mortgages and Liens
• Ch. 847: Liens

Text

(a) Whenever any mechanic's lien has been placed upon any real estate pursuant to sections 49-33, 49-34 and 49-35, the owner of that real estate, or any person interested in it, may make an application to any judge of the Superior Court that the lien be dissolved upon the substitution of a bond with surety, and the judge shall order reasonable notice to be given to the lienor of the application. If the lienor is not a resident of the state, the judge may order notice to be given by publication, registered or certified letter or personal service. If the judge is satisfied that the applicant in good faith intends to contest the lien, he shall, if the applicant offers a bond, with sufficient surety, conditioned to pay to the lienor or his assigns such amount as a court of competent jurisdiction may adjudge to have been secured by the lien, with interest and costs, order the lien to be dissolved and such bond substituted for the lien and shall return the application, notice, order and bond to the clerk of the superior court for the judicial district wherein the lien is recorded; and, if the applicant, within ten days from such return, causes a copy of the order, certified by the clerk, to be recorded in the town clerk's office where the lien is recorded, the lien shall be dissolved. Whenever a bond is substituted for any lien after an action for the foreclosure of a lien has been commenced, the plaintiff in the foreclosure may amend his complaint, without costs, so as to make the action one upon the bond with which the plaintiff may join an action to recover upon his claim. Whenever a bond is substituted for any lien before an action for the foreclosure of the lien has been commenced, the plaintiff may join the action upon the bond with an action to recover upon his claim. Whenever a bond has been substituted for any lien, pursuant to this section, unless an action is brought to recover upon the bond within one year from the date of recording the certificate of lien, the bond shall be void. (b) Whenever a bond has been substituted for any lien pursuant to this section: (1) The principal or surety on the bond, if no action to recover on the bond is then pending before any court, may make application, together with a proposed order and summons, to the superior court for the judicial district in which the action may be brought, or to any judge of the court, that a hearing be held to determine whether the lien for which the bond was substituted should be declared invalid or reduced in amount. The court or judge shall thereupon order reasonable notice of the application to be given to the obligee on the bond and, if the application is not made by all principals or sureties on the bond, shall order reasonable notice of the application to be given to all other such principals and sureties, and shall set a date for the hearing to be held thereon. If the obligee or any principal or surety entitled to notice is not a resident of this state, the notice shall be given by personal service, registered or certified mail, publication or such other method as the court or judge shall direct. At least four days notice shall be given to the obligee, principal and surety entitled to notice prior to the date of the hearing. (2) The application, order and summons shall be substantially in the form established by subsection (b) of section 49-35a , adapted accordingly. The provisions of subdivisions (1) and (2) of subsection (b) of section 49-35a , shall apply. (3) If an action on the bond is pending before any court, any party to that action may at any time prior to trial, unless an application under subdivision (1) of this subsection has previously been ruled upon, move that the lien for which the bond was substituted be declared invalid or reduced in amount. (4) No more than one application or motion under subdivision (1) or (3) of this subsection may be ruled upon with respect to any single mechanic's lien, except that the foregoing does not preclude an application or motion by a person not given notice of the prior application or not a party to the action at the time the prior motion was ruled upon. Nothing in this subdivision shall be construed as permitting a surety on a bond to bring an application for discharge or reduction, if the validity of the lien has previously been ruled upon pursuant to section 49-35a . (5) Upon the hearing held on the application or motion set forth in this subsection, the obligee on the bond shall first be required to establish that there is probable cause to sustain the validity of the lien. Any person entitled to notice under subdivision (1) of this section may appear, be heard and prove by clear and convincing evidence that the validity of the lien should not be sustained or that the amount of the lien claimed is excessive and should be reduced. Upon consideration of the facts before it, the court or judge may: (A) Deny the application or motion if probable cause to sustain the validity of the lien is established; or (B) order that the bond is void if (i) probable cause to sustain the validity of the lien is not established, or (ii) by clear and convincing evidence, the invalidity of the lien is established; or (C) order the amount of the bond reduced if the amount of the lien is found to be excessive by clear and convincing evidence. (6) Any order entered upon an application set forth in subdivision (1) of this subsection shall be deemed a final judgment for the purpose of appeal. See Sec. 52-192 re precedence in order of trial of cases where bond is substituted for mechanic's lien.

Legislative History

(1949 Rev., S. 7221; 1955, S. 2975d; P.A. 75-418, S. 8, 10; P.A. 76-436, S. 649, 681; P.A. 78-280, S. 1, 127; P.A. 79-602, S. 93; 79-631, S. 36, 111.) History: P.A. 75-418 required that action be brought to recover upon bond within one year from date of recording certificate of lien, rather than within two years, and added Subsec. (b); P.A. 76-436 added reference to judicial districts in Subsec. (a) and deleted reference to applications made to court of common pleas in Subsec. (b), effective July 1, 1978; P.A. 78-280 deleted reference to counties in Subsec. (a); P.A. 79-602 made minor changes in wording but made no substantive changes; P.A. 79-631 made technical correction in Subsec. (b)(5). In action on bond, no recovery can be had for loss due to being prevented from completing contract. 89 C. 107. Amending complaint to show substitution of bond for lien. 96 C. 401. Cited. 144 C. 499. In an action to recover upon bond, defense that lien was invalid as a blanket lien must be specially pleaded. 147 C. 351. Cited. 168 C. 371; 169 C. 76. Principal or surety on bond which has been substituted for mechanic's lien by private agreement of parties may apply for discharge or reduction of bond. 172 C. 1. Cited. 176 C. 409; 180 C. 501. Plaintiff's rights on bond can rise no higher than those acquired under the underlying mechanic's lien. Id., 545. Cited. 183 C. 85; Id., 108. Challenge by general contractor to constitutionality of mechanic's lien statutes discussed. 185 C. 583. Cited. 6 CA 443; 33 CA 563. When the general contractor is not in default, unless there were payments made in bad faith, the lienable fund is the amount still owed by the property owner to the general contractor at the time the property owner receives the notice of the lien pursuant to Sec. 49-34, regardless of whether it continues to make payments to the nondefaulted general contractor. 196 CA 430. Cited. 15 CS 361; 23 CS 380; 31 CS 209; 33 CS 552; 42 CS 460. Cited. 2 Conn. Cir. Ct. 622; 6 Conn. Cir. Ct. 456. Subsec. (a): Meaning of “person interested” discussed. 183 C. 108. Cited. 224 C. 563. Bond voluntarily furnished by defendant must be treated same as if bond had been furnished pursuant to court order in accordance with Subsec. 57 CA 227. Subsec. (b): Plaintiff waived requirement for defendant to show probable cause pursuant to Subdiv. (5) when plaintiff said it wasn't necessary to go through that formality. 269 C. 599.