Page 9 - NBIZ Magazine April 2022

Time to File 3. If the lien is based on a lease transaction, the broker
The time to file the notice of lien is short. The Act must record a notice of lien after the commission is
explains what to do under three different situations: earned and before:
i) the 91st day after the date the event for which the
1. If a broker has earned a commission under a commis- commission becomes payable occurs; or
sion agreement signed by a seller or the seller’s autho- ii) the date that the person obligated to pay the commis-
rized agent, a broker must record a notice of lien: sion records a subsequent conveyance of that person’s
i) after the commission is earned; and commercial real estate interest after executing the lease
ii) before the conveyance of the commercial real estate transaction for which the lien is claimed.
interest on which the broker is claiming the lien.
The lien will be voided if not filed in the time
2. If a broker has earned a commission under a com- constraints. If the property for which the lien is
mission agreement signed by a prospective buyer or a claimed is subject to another conveyance, the notice of
prospective buyer’s authorized agent, the broker must lien has to be filed before the conveyance. This applies to
record a notice of lien: sales commissions as well as lease commissions owed.
i) after the buyer acquires legal title to the com- An additional problem arises when a broker is owed a
mercial real estate interest on which the broker is commission for a lease where there is a delay in payment
claiming a lien; and or part of the payment remains unsettled. If the notice of
st
ii) before the buyer conveys the buyer’s commer- lien is not filed by the 91 day after the commission is due,
cial real estate interest on which the broker claims then the lien will be void. The broker needs to make a quick
a lien. decision whether or not to file the notice of lien.

NBIZ ■ April 2022 9