Contractors Have Lien Rights on Improvements Built on Public Property

Haselwood v. Bremerton Ice Arena, Inc., 137 Wn. App. 872, 155 P.3d 952 (2007)

In this case, Division Two of the Washington Court of Appeals considered whether and to what extent a contractor has lien rights on a private building constructed on public property.  The City of Bremerton entered into a concession agreement with Bremerton Ice Arena, Inc. (“BIA”), under which BIA would construct an ice arena on city property and would own and operate the arena for a specified period of time.  After the expiration of that period of time, ownership of the arena improvements would transfer to the city. 

The excavation and drainage subcontractor on the project claimed it was unpaid for a portion of its work, and filed a lien the project.

The subcontractor argued that, because of the agreement between the city and BIA, the city owned the property in a proprietary capacity, and the subcontractor’s lien therefore attached to the underlying property.  Division Two disagreed, relying on the longstanding rule that public property is immune to liens. 

The court did hold, however, that under RCW 60.04.021, the subcontractor’s lien attached to improvements it made on the property, and that, under RCW 60.04.051, the trial court could order the sale and removal of the improvement from the land in order to satisfy the lien.  The court did not address how this would be accomplished where, as here, the subcontractor performed excavation services.