Wasatch Lien Service, LLC assists contractors, subcontractors, and suppliers in preserving their lien and bond rights. If you provide materials or services in connection with the construction or improvement of real property in Utah, you are granted certain rights by statute.


By Benjamin D. Johnson, Esq.
Bennett Tueller Johnson & Deere
Phone:  801-438-200

A recurring dispute between lien claimants, banks and owners has finally been put to rest by the legislature.  For perhaps as long as the lien statutes have been in place, stake holders have been arguing whether interest was secured by a lien, along with the value of the work performed, attorney’s fees and court costs. The legislature has finally settled that dispute, “clarifying” that lien claimants are indeed entitled to interest as part of their claims.

As set forth in Utah Code Ann. section 38-1a-309, “Unless otherwise specified in a lawful contract between the owner-builder and the person claiming a lien under this chapter, the interest rate applicable to the lien is the rate described in Subsection 15-1-1(2).” In other words, unless you have a contract with an owner-builder and that contract specifies a different interest rate, the interest rate on lien claims will be 10%.

The provision of interest for liens is substantial given the sometimes lengthy process it takes to resolve lien claims. Large lien claims can accrue substantial amounts of interest over the time period it takes to resolve disputes, and the ability to claim interest has the effect of preserving the real value of work performed and the cost of non-payment to the lien claimant. If you have a contract with an owner-builder, there is no limitation on interest rates in Utah, although interest rates are typically between 18% and 24%. This “clarification” in the law is very welcome after the unfavorable changes in the lien laws passed by the insurance and banking lobbies in 2011.