If it was not already apparent to those in the Illinois construction industry that completion of your paperwork is as important as proper completion of your services, Cityline Construction v. Roberts, 2014 Ill. App. (1st) 130730 drives that point home. In Cityline Construction, the Illinois Appellate Court ruled that a trial court had properly entered judgment in defendant owner’s favor when it declared Cityline Construction’s (“Cityline”) mechanic’s lien void and unenforceable because Cityline failed to provide its sworn contractor’s statement as required under section 5 of the Illinois Mechanic Lien Act (“Act”). Cityline’s mistake was simple and costly, to the tune of almost $400,000.
Cityline and the defendant owners entered into an oral agreement under which Cityline provide restoration and reconstruction services to the defendant owner’s residence after it was damaged by a fire. Cityline completed all its work and, it should be noted, there was no dispute that Cityline was owed $397,302 for the labor and services it provided. Cityline recorded its mechanic’s lien for $397,302 plus interest and filed a lawsuit seeking to foreclose its lien. In response, the defendant owners filed a counterclaim and partial motion for summary judgment in which they argued that Cityline’s mechanic’s lien was void and unenforceable as defendant owners had requested a contractor’s sworn statement under section 5 of the Act from Cityline, but one was never provided. Cityline admitted that it failed to provide the sworn statement to the defendant owners.
Section 5(a) of the Act specifically provides that, “[i]t shall be the duty of the contractor to give the owner, and the duty of the owner to require of the contractor” a sworn statement listing the subcontractors, suppliers, and the amounts due to each. 770 ILCS 60/5(a). Cityline essentially argued that strict compliance with section 5 was not required under the circumstances because it would be unfair for it to lose a mechanic’s lien claim based on a technicality. The Appellate Court disagreed and held that the statutory language of the Act must be strictly followed. “Regardless of equitable considerations, the procedural and technical requirements of section 5 of the Act must be strictly complied with in order for a mechanic’s lien to be valid.”
As the Act is incorporated into every construction contract in Illinois, it is critical that contractors comply with not only section 5 of the Act, but all of its stringent requirements in order to preserve their lien rights and ability to recover.