Collecting in Texas

Discussion in 'Business Operations' started by Meier, Sep 25, 2003.

  1. Meier

    Meier LawnSite Senior Member
    from DFW
    Messages: 269

    Does anyone have any experience with the legal system/collections in Texas?

    My friend is an experienced attorney in Oklahoma. He tells me that in Oklahoma, after you complete your work on someone esle's property (materials or labor, so mowing is included), if you don't get paid, you can immediately file a lien on the property. This lien is only good for like 60 days or so. What you have to do then is get a judgement and that makes the lien valid for something like 5 years or so.

    I doubt there's much difference between the way this works in Oklahoma vs Texas.

    Anyone have experience with this in Texas?

    DFW, TX
  2. Team Gopher

    Team Gopher LawnSite Platinum Member
    from -
    Messages: 4,040

  3. SWD

    SWD LawnSite Senior Member
    Messages: 988

    Meier, yes I have, unfortunately, a great deal of experience with collecting this way.
    Unless the law just changed, as a LCO, you cannot file a lien on a residental home site for lawn, landscape, or other normal LCO activity.
    The steps to collect are:
    1. Write a demand letter, return receipt requested, post a second normal mail.
    2. After return receipt is given to you, wait the time you specificed in the letter.
    3. You HAVE to know what preceinct the offender lives in as this is where you will go, talk to the JP, fill out the affidavit, then wait.
    4. There are certain filing fees, typically start around $80.00, plus the mail receipts, then your lost time.
    The good thing is Texas allows for 'reasonable' cost assocciated with collection efforts to be included in your affidavit. What I have done is calculate what the outstanding bill is, add interest of 18%, administrative fee of $175.00 (for actually doing the paper work), then the lost income for taking off of work to go file.
    Usually the JP will try to negotiate a settlement between you the filer and the filee. This is because, once the JP gets involved, he assesses fines to the filee.
    5. Now wait, as the Constable has to go out and serve the warrant to command the filee to appear in front of the JP. Depending on how busy the JP is, and how much money the JP and court system will make from this, the warrant may never get served.
    Last but not least, if the warrant isn't served, you cannot do an end run around the JP, like into District court, as in other court will hear your complaint.
    I have been waiting two years for a Constable to serve a criminal warrant off of a bad check to a dead beat.
    Good luck,
  4. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116


    Thanks for the input. I have been reading up on the mechanics' lien in Texas. The problem I see in reading the law is that we have to provide labor for construction or repair of a property.

    Now, the city can claim that a property is out of ordinance if the grass is too tall. So, if we're mowing the lawn, wouldn't that be something that keeps or prevents the property from entering a state of disrepair? After all, if the property is not in ordinance with the city code, wouldn't a repair be necessary? Maybe maintenance could be considered a repair?

    Chapter 53 doesn't define repair. If it did, we might very well qualify.

    If we could figure out a loop hole in the law that would allow lawn mowing companies to get a mechanics' lien, we'd be so much better off.

    A friend of mine is an attorney with basically zero experience with this, but he thought we'd be entitled to a constitutional artisans' lien. I just can't find anything anywhere about this type of lien.

    The problem with a judgement lien is that if the customer files bankruptcy, they can wipe this out and then you've not only mowed their lawn for free, but your also out the fees for small claims court and filing the lien with the county clerk.

    There is an attorney with a lot of experience with these matters that I could hire, but she charges $170.00 per hour. I can't really justify that rate to collect on $200 past due accounts. If I KNEW the customer had money, I'd do it. But then again, that's the reason they're not paying in the first place.

    If you can get a mechanics lien, the only way you wouldn't get paid is if they enter bankruptcy and the mortgage gets foreclosed on. From what I understand, most personal bankruptcies basically wipe out all unsecured debts, like credit cards, but leave the mortgage untouched. Then, years later, when the deadbeat finally goes to refi or sell or get a home equity loan, he'd have to pay off the mechanics' lien first, plus interest.

    DFW Area Landscaper
  5. SWD

    SWD LawnSite Senior Member
    Messages: 988

    DFW, as I understand it, provided you have gone through the hoops of the demand letter and filing with the JP, a judgement can be attached. What this means is that if the deadbeat files bankruptcy, you go to court (again the JP) and agree upon what you will settle for.
    Unfortunately, this takes time, patience and a bunch of money to collect what you are owed.
    I wish I had a better statement than 'good luck'. However, I do not. I am still waiting for the constable to serve a warrant on a bad check for over $900 and have been waiting for over a year.
    Another thing, just because some one doesn't pay, doesn't mean they are out of money. You just haven't made it painful enough for them to pay.
    It took me a ton of time, a ton of phone calls and one certified letter to get a deadbeat to pay me $50 - but it was a principle matter.
    All I can say is this state sucks when it comes to enforcing payment for services. I even tried the fraud angle and theft of services but the county attorney said no way, not for landscape maintenance.
  6. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    It just seems like such crap that if one constructs or repairs, they're entitled to a mechanic's lien. However, maintenance is not included.

    What this means is that LCO's, carpet cleaners and maid services are about the only professions in the state of Texas who can go do work on someones home and aren't entitled to a mechanics' lien.

    Window guys...yes
    A/C Contractors...yes
    Landcape installation guys...yes
    Irrigation guys...yes
    Vinyl Siding guys...yes
    Concrete guys...yes

    Seems rather arbitrary if you ask me.

    I wonder if painters can get mechanics' liens? Also, what about Orkin and the pesticide guys? Would extermination of termites be considered a repair? If riddance of that pest is a repair, then possibly you could say that anyone who removes pests is entitled? And mowing regularly removes certain weeds...which are defined as pests by the Texas Department of Agriculture.

    DFW Area Landcaper
  7. SWD

    SWD LawnSite Senior Member
    Messages: 988

    DFW, I agree with all of your info in the post yet one. I have tried through two attorneys, the JP and the county attorney for a mechanic's lien for landscape installation. All said it wasn't possible. Why it wasn't possible was that the state considers plants as a non permanent addition, therefore the state has a precident of not enforcing lien statutes for landscape installation. Perhaps the state has amended that part since I have been looking (it has been a year). I do know that irrigation installation has a mechanic's lien protection.
    However, on a positive note, the deadbeat that fled to avoid paying me has been located. And his deadbeat girl friend who bounced a check in partial payment to me is the one whom I had criminal charges on - well I got payment for the bad check from the county yesterday. It only took 16 months.
    With regards to payment, on new accounts for maintenance, I bill monthly. If I have not received payment that next month, I stop. If the new account wants landscape maintenance or installation, until a payment history is known, they pay for all material up front and half of the labor. Usually, about 90 % of the time, I have no problems with the customers on this position. It is the other 10% that say no way, and they end up being late payers on maintenance. I have a defined interest rate penalty for late payers, and I do enforce it. This has really helped to weed out the poor customers.
    The only aspect I do not like with commercial accounts is I have never been able to successfully get them to pay interest when late. Therefore, I have adjusted my hourly rate upward to allow for the length of payment.
  8. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    Nope. Landscape installs get a mechanics' lien.

    Section 53.021 Paragraph 2 (d)

    A person who provides labor, plant material, or other supplies for the installation of landscaping for a house, building, or improvement, including the construction of a retention pond, retaining wall, berm, irrigation system, fountain, or other similar installation, under or by virtue of a written contract with the owner or the owner's agent, trustee, or receiver has a lien on the property.

    DFW Area Landscaper
  9. eakern

    eakern LawnSite Member
    from Georgia
    Messages: 39

    Is there any way that one could use a criminal charge for theft of services ? I know if you run out on a dinner or a can be charged with theft of services.
  10. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Messages: 2,116

    ++++Is there any way that one could use a criminal charge for theft of services ? I know if you run out on a dinner or a can be charged with theft of services.++++

    Won't work. When a thief runs out on a dinner check, they are showing intent to defraud when they attempt to run out. I doubt many judges would view this as simply a breach of contract.

    When someone doesn't pay a bill, it's not criminal intent. It's a breach of contract.

    DFW Area Landscaper

Share This Page