Build On This!

The Cleveland Plain Dealer reports that 59 defendants were indicted on charges of racketeering, forgery and theft in connection with supplying false information to obtain home loans. The scheme involved properties in Cleveland, East Cleveland, and Garfield Heights. More indictments are expected.

Attorney Don Leach reports that H.B. 487 has passed the Ohio General Assembly and becomes effective March 29, 2007. It primarily deals with mechanics' liens on residential work and provides that:

Lien claimants can be liable for attorney's fees when they fail to timely release their residential liens when a homeowner has submitted a "full payment" affidavit (that he has or will pay the homebuilder in full).

Allows a Notice of Commencement on residential construction, but does not require a notice of furnishing from the prospective lien claimant.

Provides that a Notice of Commencement generally expires six (6) years after its filing.

If the Notice of Commencement and Mortgage are recorded on the same day, the mortgage shall be considered recorded first, preserving the lender's priority over lien claimants.

These provisions primarily assist residential construction lenders and title companies.

The Ohio General Assembly has also enacted H.B. 80, requiring that all construction managers, contractors and subcontractors (regardless of tier) be enrolled in a drug-free workplace program to be able to do public construction work in Ohio. The law becomes effective March 29, 2007.

Consequences of a failure to do so include being considered in breach of contract and further can be considered in determining a bidder non-responsible for a five-year period.