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Lender then moved to remove Plaintiff's lien and expunge the lis pendens, asserting that Plaintiff was not able to demonstrate the probable validity of its lien, because the Plaintiff had failed to serve the Lender with a preliminary 20-day notice as required by California Civil Code Section 3097. The trial court agreed and granted the motion.
Moreover, in rejecting the Plaintiff's second argument that a person with a "direct contract" with the Owner is a "contractor" for purposes of section 3097, and therefore exempt from providing the Lender the preliminary 20-day notice, the Court determined that the Plaintiff's interpretation would render subdivision (b) meaningless. Finding support for its interpretation in other court opinions, the Court concluded that the term "contractor" in subdivision (b) referred to the general contractor for the whole project, not to persons with a "direct contract" with the owner, such as the Plaintiff in this case. See, e.g., Westfour Corp. v. California First Bank, 3 Cal. App.4th 1554, 1561(1992); Kodiak Industries Inc. v. Ellis, 185 Cal. App.3d 75, 82 n.3 (1986).
Ralph T. Wutscher
McGinnis Tessitore Wutscher LLP
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