Reviewed September 7, 2026.
In Inter Metal Fabricators, Inc. v. HRH Construction LLC, 94 AD3d 529 (1st Dept 2012), the First Department affirmed summary judgment dismissing lien-foreclosure claims and establishing liability on the contractor’s willful-exaggeration counterclaim.
The proof included the lienor’s own documents showing knowing markups of costs and expenses, together with an officer’s testimony admitting overcharges. The court found the evidence conclusive. A trial was not required merely because intent was an element of the claim.
Markups depend on entitlement
The decision is not a general ban on profit or contractually authorized markups. It illustrates the risk of knowingly claiming amounts beyond the agreed entitlement and then using a lien to secure them. Review contract pricing, allowed markups, change orders and credits before filing.
The appellate opinion affirmed liability; it did not specify a final damages amount. § 39 can invalidate the entire lien for willful exaggeration, and § 39-a defines damages in a qualifying enforcement proceeding. Do not assume automatic triple damages or that the penalty is limited to deleting the improper line item.
Kushnick Pallaci PLLC assists clients throughout New York with lien litigation and exaggeration claims. Contact 631-752-7100 or vtp@kushnicklaw.com.
Attorney Advertising. General information, not legal advice.
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