45. What is a "notice of nonresponsibility"?
A notice of nonresponsibility informs persons eligible to
file a mechanics lien that the owner did not commission the work and will not
be held liable if the non-owner who contracted for the work defaults on the
payment. This notice must be recorded by the owner with the county recorder and
then posted on the property in a conspicuous area. To be effective, it must be
recorded and posted within 10 days of when the owner learns of the construction
on the property. (Cal. Civ. Code §8442). A notice posted after 10 days is not
effective. A notice posted before work begins is not effective either. (Jay
Bailey Const. Co. v. Berry Hotel Corp. (1963), 221 Cal. App. 2d 135).
A notice of nonresponsibility is used in situations
where a person other than the owner of the property, usually a tenant, hires a
construction worker to work on the property. By posting this notice, the owner
is denying responsibility for the work and shifting all the responsibility to
the person who hired the workers.
Even if a notice of responsibility has been posted
and recorded, the claimant may still record a mechanics lien; however, the lien
will attach only to the lessee's (or prospective buyer's) improvement in the
property and not to the entire real property. (Cal. Civ. Code § 3094; Howard S.
Wright Construction Co. v. Superior Court (2003), 106 Cal. App. 4th 314).
However, a notice of nonresponsibility protects an
owner from a mechanics lien only when the owner is not involved in the
construction process, and, therefore, is truly not responsible for the work.
(Ott Hardware Company, Inc. v. E. D. Yost (1945), 69 Cal. App. 2d 593). An
owner who “participates” in the renovations cannot waive his or her liability
and risks being subject to a mechanics lien. Participation includes overseeing
the project, having final approval on the plans, and directing the workers. The
owner is also a participant when the lease agreement requires the land to be
improved and the improvements go back to the owner after the lease ends. (Los
Banos Gravel Co. v. Freeman (1976), 58 Cal. App. 3d 785). Paying for a portion
of the work is a factor to be considered in deciding whether an owner is
“participating.” But payment for some materials by itself does not necessarily
prove participation. (Ott Hardware Company, Inc. v. E. D. Yost (1945), 69 Cal.
App. 2d 593; Hayward Lbr. & Inv. Co. v Ford (194
4), 64 Cal. App. 2d