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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Legal
Satisfied Customers: 118788
Experience:  JA Mentor -Attorney Labor/employment, corporate, sports law, admiralty/maritime and civil rights law
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My Question is regarding lien laws. We provided service work

Customer Question

My Question is regarding lien laws. We provided service work for a Northern Colorado Restaurant over the past 31/2 years for 5 locations. The owner became financially troubled and did not relay this issue to us. In fact he was ordering new repair work up until the day he informed us the business was sold. He sold the restaurant assets and stuck us with over $70,000 in bills for over 1 year. The rumor is the proceeds were set aside in retirement accounts to utilize a bad Colorado law. Some for new equipment and some for a store remodel. The owner did not own the property. We have liens filed. We are curious as to what time frames and options are available to us. We had bad personal experience with Colorado Lien laws being manipulated by a General Contractor that failed to provide a finished product, failed to provide a product that matched the contract or blue-prints, and has code violations. The damages were for much more than the contract amount and we were in essence left with a project to finish and not one we asked for. So our experience with Colorado law has been the best liar wins. The amount of money owed has created a lost year trying to get caught up and has put a financial burden that would bankrupt most small businesses. We would foreclose the liens but are afraid it will end up with more massive legal fees and another manipulation of the courts.
Submitted: 1 year ago.
Category: Legal
Expert:  Law Educator, Esq. replied 1 year ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
You need to eventually foreclose on those liens or sue the client for the breach of contract and money due. However, if you sue, then there is nothing preventing him from filing for bankruptcy and even though you may have a lien, if there are other liens (such as mortgage or loans ahead of you filing your lien) ahead of your lien they collect first. So you could lose even if you win on suing for a judgment by them filing bankruptcy or your lien being junior to one of the other liens.
So you need to sue to foreclose on your liens if you want to collect, but that could cause them to file bankruptcy and you still will not end up paid. This is a tough case.