CSLB Law & Business ExamInsurance and LiensEasy
A subcontractor performs work on a public school construction project and is not paid by the general contractor. Since public property cannot be encumbered by a mechanics lien, what remedy is available to the subcontractor?
- APlacing a lien release bond on the project
- BRecording a mechanics lien against the school district's land
- CFiling a claim against the public works payment bond
- DFiling a stop payment notice against the school district's general fund
Show answer & explanationAnswer & explanation
Correct answer: C. Filing a claim against the public works payment bond
Public property is exempt from mechanics liens, so the law requires a payment bond on public works projects; unpaid subcontractors and suppliers make a claim against that bond instead of recording a lien. This bond serves the same security purpose that a mechanics lien serves on private jobs.
Why the other options are wrong
- A. Lien release bonds remove existing liens from title, not applicable to public works.
- B. Public entities' property cannot be subjected to mechanics liens.
- D. A stop payment notice can be used on public works but does not replace the payment bond claim as the primary lien-equivalent remedy.
Public Works Payment Bond
Because mechanics liens cannot attach to public property, contractors and suppliers on public projects must claim against a statutory payment bond instead.
- Public works require a payment bond in lieu of lien rights
- Bond protects subcontractors and suppliers
- Claim deadlines and notice requirements still apply
Memory trick: Can't lien the school, so bond becomes the tool.