§ 21 — Discharge of lien for public improvement

New York § 21

• Jurisdiction: New York
• Law LIE: Lien
• Art. 2: Mechanics' Liens

Text

§ 21. Discharge of lien for public improvement. A lien against the\namount due or to become due a contractor from the state or a public\ncorporation for the construction or demolition of a public improvement\nmay be discharged as follows:\n 1. By filing a certificate of the lienor or his successor in interest,\nduly acknowledged and approved, stating that the lien is discharged.\n 2. By lapse of time as follows:\n (a) When one year has elapsed since the filing of the notice of lien\nor an extension thereof, unless, before the expiration thereof, either\nan extension or an order continuing said lien has been filed in the\noffice where the notices are filed, or a notice of the pendency of an\naction to enforce said lien has been filed as provided in section\neighteen of this article.\n (b) When the period of time for which the lien has been continued by\norder has expired, unless, before the expiration thereof, either an\norder continuing said lien for a further period of time has been filed\nin the offices where the notices are filed, or a notice of the pendency\nof an action to enforce said lien has been filed as provided in section\neighteen of this article.\n 3. By satisfaction of a judgment rendered in an action to enforce the\nlien.\n 3-a. Under the provisions of subdivisions four, five and six of this\nsection a discharge of lien shall only operate to relieve the\ncomptroller of the state or the financial officer of the public\ncorporation or the officer or person with whom the lien is filed of any\nand all liability imposed upon such officer by reason of the filing of\nthe lien. Such lien shall be a valid and subsisting lien for all other\npurposes until discharged as prescribed by the provisions of the other\nsubdivisions of this section.\n 4. By the contractor applying without notice to the supreme court of\nthis state or to any justice thereof or to the county judge of any\ncounty for an order discharging such lien and depositing with the\ncomptroller of the state or the financial officer of the public\ncorporation, or the officer or person with whom the notice of lien is\nfiled, such a sum of money as is directed by a judge or a justice of the\ncourt, which shall not be less than the amount claimed by the lienor,\nwith interest thereon for the term of one year from the time of making\nsuch deposit, and such additional amount as the judge or justice deems\nsufficient to cover all costs and expenses. The amount so deposited\nshall remain with the comptroller or such financial officer or other\nofficer or person until the lien is otherwise discharged as prescribed\nin this section.\n (5) Either before or after the beginning of an action by a contractor\nor subcontractor executing a bond or undertaking in an amount equal to\none hundred ten percent of such lien conditioned for the payment of any\njudgement which may be recovered in an action to enforce the lien:\n a. The execution of any such bond or undertaking by any fidelity or\nsurety company authorized by the laws of this state to transact\nbusiness, shall be sufficient; and where a certificate of qualification\nhas been issued by the superintendent of financial services under the\nprovisions of section one thousand one hundred eleven of the insurance\nlaw, and has not been revoked, no justification or notice thereof shall\nbe necessary. Any such company may execute any such bond or undertaking\nas surety by the hand of its officers, or attorney, duly authorized\nthereto by resolution of its board of directors, a certified copy of\nwhich resolution, under seal of said company, shall be filed with each\nbond or undertaking. Any such bond or undertaking shall be filed with\nthe state or the public corporation with which the notice of lien is\nfiled and a copy shall be served upon the adverse party. The undertaking\nis effective when so served and filed. If a certificate of qualification\nissued pursuant to subsections (b), (c) and (d) of section one thousand\none hundred eleven of the insurance law is not filed with the\nundertaking, a party may except, to the sufficiency of a surety and by a\nwritten notice of exception served upon the adverse party within ten\ndays after receipt, a copy of the undertaking. Exceptions deemed by the\ncourt to have been taken unnecessarily, or for vexation or delay, may,\nupon notice, be set aside, with costs. Where no exception to sureties is\ntaken within ten days or where exceptions taken are set aside the\nundertaking shall be allowed.\n b. In the case of bonds or undertakings not executed pursuant to\nparagraph a of this subdivision, the owner or contractor shall execute\nan undertaking with two or more sufficient sureties, who shall be free\nholders, to the state or public corporation with which the notice of\nlien is filed. The sureties must together justify in at least double the\nsum named in the undertaking. A copy of the undertaking, with notice\nthat the sureties will justify before the court, or a judge or justice\nthereof, at the time and place therein mentioned, must be served upon\nthe lienor or his attorney, not less than five days before such time.\nUpon the approval of the undertaking by the court, judge or justice an\norder shall be made by such court, judge or justice discharging such\nlien.\n c. If the lienor cannot be found, or does not appear by attorney, then\nservice under this subsection may be made as prescribed in paragraph c\nof subdivision four of section nineteen of this article for the service\nof an undertaking with notice of justification of sureties.\nNotwithstanding the other provisions of this subdivision relating to\nservice of notice, in any case where the mailing address of the lienor\nis outside the state such service may be made by registered or certified\nmail, return receipt requested, to such lienor at the mailing address\ncontained in the notice of lien.\n d. Except as otherwise provided in this subdivision, the provisions of\narticle twenty-five of the civil practice law and rules regulating\nundertakings is applicable to a bond or undertaking given for the\ndischarge of a lien on account of public improvements.\n 6. Where a contractor has to his credit with the state or with a\npublic corporation, a sum of money by reason of an estimate due and\npayable to him, and where payment of such estimate is withheld because a\nnotice of lien has been filed against his interest in said money, and\nwhere said money is in excess of the amount claimed in the notice of\nlien, the contractor may apply without notice to the supreme court of\nthis state or to any justice thereof or to the county judge of any\ncounty, for an order discharging such lien and directing the comptroller\nof the state or the financial officer or person with whom the lien is\nfiled, to retain from such estimate a sum of money, which shall not be\nless than the amount claimed by the lienor, with interest thereon for\none year and such additional amount as the judge or justice deems\nsufficient to cover all costs and expenses and to immediately pay over\nthe balance of such estimate to the contractor. The amount so retained\nshall be held by the comptroller or such financial officer or other\nofficer or person until the lien is otherwise discharged as provided in\nthis section. The application for the order may be made upon an\naffidavit of the contractor or his attorney and where there is of record\nan assignment of all moneys the written consent of such assignee must be\npresented to the court showing a proper case therefor.\n 6-a. Where a contractor has to his credit with the state, or with a\npublic corporation, a sum of money by reason of an estimate due and\npayable to him, and where payment of such estimate is withheld because a\nnotice of lien has been filed against his interest in said money, and\nwhere the amount due and payable under said estimate is at least one and\none-half times in excess of the amount stated to be due in said notice\nof lien, the comptroller of the state or the financial officer or person\nwith whom the notice of lien is filed, may pay said estimate, after\ndeducting therefrom a sum which shall be one and one-half times the\namount stated to be due in said notice of lien, and said sum so deducted\nshall be withheld until said lien is otherwise discharged, as provided\nin this section.\n 7. Where it appears from the face of the notice of lien that the\nclaimant has no valid lien by reason of the character of the labor or\nmaterials furnished and for which a lien is claimed, or where the notice\nof lien is invalid by reason of failure to comply with the provisions of\nsection twelve of this article, or where it appears from the public\nrecords that such notice has not been filed in accordance with the\nprovisions of section twelve of this article, the contractor or any\nother party in interest, may apply to the supreme court of this state,\nor to any justice thereof, or to the county judge of the county in which\nthe notice of lien is filed, for an order summarily discharging of\nrecord the alleged lien. A copy of the papers upon which application\nwill be made together with a notice setting forth the court or the\njustice thereof or the judge to whom the application will be made at a\ntime and place therein mentioned must be served upon the lienor not less\nthan five days before such time. If the lienor can not be found, such\nservice may be made as the court, justice or judge may direct. The\napplication must be made upon a verified petition accompanied by other\nwritten proof showing a proper case therefor, and upon the approval of\nthe application by the court, justice or judge, an order shall be made\ndischarging the alleged lien of record.\n 8. By order of the court vacating or canceling such lien of record,\nfor neglect of the lienor to prosecute the same, granted pursuant to\nsection twenty-one-a of this article.\n