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You wrote, Anyway, lots of construction liens during building. Do well-capitalized developers get stuck with construction liens regularly or is this something indicative of a developer trying to leverage little capital until the development is completed and disposed of (sold, rented to reasonable capacity)? The developer I'm investigating is clearly leveraging government capital and has none of his own, but I'm wondering if even a big league developer often has cash flow problems that lead to temporary liens.

Construction liens are usually either indicative of cash flow problems or fraud. They can occur in projects large or small. But it usually means the general contractor or owner has made a conscious decision to continue the project on the backs of subs and suppliers in the hopes of completing and selling the project before the lien holders perfect their liens.

When this type of problem occurs, it can be hard to prove a criminal intent. The civil liabilities are much more straight-forward and is so common all US jurisdictions allow workman-type liens to be filed with a simple and inexpensive administrative process. (Which can lead to abuses ... but that's another topic.)

Ultimately the lien-holders need to perfect their liens, which involves following a state-mandated set of civil procedures which includes filing for foreclosure on the property within a certain time period. If they fail to perfect their liens, they will eventually expire worthless ... just like most judgments would if the claimant fails to pursue seizure or garnishment orders.


Likely this guy is a crook. Proving it is another matter.

Since this is mainly a political issue for you, you don't have to prove a case to the same standard. It just needs to be compelling and you need to air it before the right people in a time frame that will allow them to take appropriate action.

So have you spoken with any of the local media?

- Joel
Who's not a lawyer...
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