It happens more than it should. A homeowner pays every contractor invoice on time. The contractor nonetheless walks off the job before finishing. The homeowner is then forced to pay someone else to complete the work. Then, shockingly, a lien arrives from a supplier the homeowner has never heard of, claiming the original contractor never paid for materials.
A recent Hennepin County decision, US LBM Operating Co 3009 LLC d/b/a Lampert Lumber v. Mark King Construction Inc., et al., shows how Minnesota law limits what that supplier can recover. Hellmuth & Johnson represented the homeowners.
What happened
The homeowners signed a $70,500 contract for a new deck. The last 25 percent was due only when the work was finished. They immediately paid the two invoices they received, $53,337.50 in all. The contractor then quit, leaving the railings uninstalled. The homeowners paid a second contractor $13,765 to finish the job.
Then, much to the homeowners’ surprise, a lumber supplier that had sold materials to the first contractor recorded a $17,443.17 lien on their home. Before the lien statement was recorded, the homeowners had never even heard of the lumber supplier, let alone placed an order or been made aware of any purported debt for which they could be held responsible.
Believing the lien was an error, the homeowners reached out to the lumber supplier and provided information and documentation showing they had already paid their original contractor in full and paid a second contractor to finish the job.
The supplier’s argument
Minnesota’s lien statute, specifically at Minn. Stat. §514.03, caps a supplier’s lien at the contract price minus what the homeowner paid the contractor before receiving the supplier’s notice.[1] In this case, that amount was $70,500 (contract price) minus $53,337.50 (amount the homeowners paid the original contractor), or $17,162.50. The supplier argued to the court that it could recover up to that amount. The problem is that this math ignores the $13,765 the homeowners had already spent to finish the job.
The court’s answer
The court held that the statutory cap provided under Minn. Stat. §514.03 is only a ceiling. When a contractor abandons a project, ordinary contract law decides how much is actually owed, and that number is often substantially lower. A contractor who walks off can recover, at most, the contract price minus the cost to finish its work. Here:
- Contract price: $70,500
- Less cost to finish: $13,765
- Most the contractor could have earned: $56,735
- Less what the homeowners paid: $53,337.50
- Most that could possibly be owed: $3,397.50
In practice, Minn. Stat. § 514.03 dictates that, under these facts, supplier liens can be no larger in amount than what the homeowner owes the general contractor. In this case, the supplier claimed more than five times that maximum. Because the supplier also failed to prove the value of anything it delivered, the court found it could recover nothing.
The court relied on the Minnesota Supreme Court’s decision in E.C.I. Corp. v. G.G.C. Co. and a 2025 Court of Appeals decision, All Around Property Preservation, LLC v. Clark. The court also rejected the lien because the supplier never proved it delivered materials to the home or served the required prelien notice.
The district court also found that the supplier acted with malice by keeping the lien in place after seeing and failing to account for the homeowners’ payment records, and it awarded the homeowners their attorneys’ fees as special damages for slander of title.
Why it matters
Minnesota mechanic’s lien law is meant to keep homeowners from paying twice for the same work. A homeowner who pays a second contractor to finish a job has already paid for the unfinished part. Letting a supplier lien that same balance would make the homeowner pay a third time. The district court made clear in its decision that such a result is contrary to both the letter and spirit of Minnesota mechanic’s lien laws.
The decision is not binding on other courts, and lien claimants will point to a 2021 Court of Appeals case, All, Inc. v. Hagen, to argue that the statutory cap controls. But the court’s reasoning here gives homeowners a strong, practical defense.
Tips for homeowners
- Keep your contract and proof of every payment.
- If you receive a lien notice from a supplier, ask for lien waivers before paying your contractor anything more.
- If a lien is filed, do the math: contract price, minus the cost to finish, minus what you paid.
- If you owe less than the amount reflected in the supplier’s mechanic’s lien statement, reach out to the lien claimant, provide supporting documentation, and demand the lien be released or reduced, as appropriate. If the lien claimant disregards your documentation and persists with enforcement of a void or overstated mechanic’s lien, you may have a basis to recover your attorneys’ fees through a slander of title counterclaim.
If you have questions about a lien on your home, contact Daniel J. Sathre at dsathre@hjlawfirm.com or (952) 460-9235.
For more information about contractor liens, review our Construction & Lien Law practice page.
