Conquer California Contractor Law 2026 – Build Your Future with Confidence!

A contractor can file a mechanic's lien primarily when they have not been paid for work done or materials supplied on a project. This legal right is established to protect contractors, subcontractors, and suppliers by allowing them to claim an interest in the property when they have not received the compensation owed for their contributions.

Mechanic's liens serve as a security interest in the property in question, ensuring that contractors and service providers have recourse to resolve disputes regarding payment. This mechanism not only helps in the collection of debts but also encourages timely payments from project owners, as property rights are tied to the completion of financial obligations.

The other options do not provide valid grounds for filing a mechanic's lien. Not being paid is the crucial element that justifies the lien, while completing a project ahead of schedule, exceeding a budget, or declaring bankruptcy do not inherently relate to the right to file a lien under California law.