ORS 87.025
Priority of perfected liens

  • right to sell improvements separately from land
  • notice to mortgagee
  • list of materials or supplies

(1)

A lien created under ORS 87.010 (Construction liens) (2) or (6) and perfected under ORS 87.035 (Perfecting lien) upon any lot or parcel of land shall be preferred to any lien, mortgage or other encumbrance which attached to the land after or was unrecorded at the time of commencement of the improvement.

(2)

Except as provided in subsections (3) and (6) of this section, a lien created under ORS 87.010 (Construction liens) (1), (4) or (5) and perfected under ORS 87.035 (Perfecting lien) upon any improvement shall be preferred to all prior liens, mortgages or other encumbrances upon the land upon which the improvement was constructed. To enforce such lien the improvement may be sold separately from the land; and the purchaser may remove the improvement within a reasonable time thereafter, not to exceed 30 days, upon the payment to the owner of the land of a reasonable rent for its use from the date of its purchase to the time of removal. If such removal is prevented by legal proceedings, the 30 days shall not begin to run until the final determination of such proceedings in the court of first resort or the appellate court if appeal is taken.

(3)

No lien for materials or supplies shall have priority over any recorded mortgage or trust deed on either the land or improvement unless the person furnishing the material or supplies, not later than eight days, not including Saturdays, Sundays and other holidays as defined in ORS 187.010 (Legal holidays), after the date of delivery of material or supplies for which a lien may be claimed delivers to the mortgagee either a copy of the notice given to the owner under ORS 87.021 (Notice to owners) to protect the right to claim a lien on the material or supplies or a notice in any form that provides substantially the same information as the form set forth in ORS 87.023 (Notice of right to lien).

(4)

A mortgagee who has received notice of delivery of materials or supplies in accordance with the provisions of subsection (3) of this section, may demand a list of those materials or supplies including a statement of the amount due by reason of delivery thereof. The list of materials or supplies shall be delivered to the mortgagee within 15 days, not including Saturdays, Sundays and other holidays as defined in ORS 187.010 (Legal holidays), of receipt of demand, as evidenced by a receipt or a receipt of delivery of a registered or certified letter containing the demand. Failure to furnish the list or the amount due by the person giving notice of delivery of the materials or supplies shall constitute a waiver of the preference provided in subsections (1) and (2) of this section.

(5)

Upon payment and acceptance of the amount due to the supplier of materials or supplies, and upon demand of the person making payment, the supplier shall execute a waiver of all lien rights as to materials or supplies for which payment has been made.

(6)

Unless the mortgage or trust deed is given to secure a loan made to finance the alteration or repair, a lien created under ORS 87.010 (Construction liens) and perfected under ORS 87.035 (Perfecting lien) for the alteration and repair of an improvement commenced and made subsequent to the date of record of a duly executed and recorded mortgage or trust deed on that improvement or on the site shall not take precedence over the mortgage or trust deed.

(7)

The perfection of a lien under ORS 87.035 (Perfecting lien) relates to the date of commencement of the improvement as defined in ORS 87.005 (Definitions for ORS 87.001 to 87.060 and 87.075 to 87.093). Except as provided in subsection (3) of this section, the date of creation of the lien under ORS 87.010 (Construction liens) and the date of perfection of the lien under ORS 87.035 (Perfecting lien) do not affect the priorities under this section, the equal priority of perfected lien claimants, or the distribution of proceeds to perfected lien claimants under ORS 87.060 (Foreclosure) (6). [Amended by 1965 c.446 §2; 1967 c.602 §2; 1975 c.466 §8; 1981 c.757 §6; 1983 c.513 §1; 1983 c.674 §3; 1985 c.513 §1; 1987 c.662 §3]

Source: Section 87.025 — Priority of perfected liens; right to sell improvements separately from land; notice to mortgagee; list of materials or supplies, https://www.­oregonlegislature.­gov/bills_laws/ors/ors087.­html.

Notes of Decisions

This statute does not require notice to holders of both prior and subsequently recorded mortgages and thus the construction lien took precedence over mortgage not recorded until after holder of the lien commenced to deliver materials to the property. Hickey v. Polachek, 63 Or App 784, 666 P2d 294 (1983)

For person claiming lien based on provision of materials to obtain priority over prior mortgagee, lien claimant must provide mortgagee with notice of materials provided, whether or not labor is also provided. Safeport, Inc. v. Equipment Roundup & Manufacturing, Inc., 184 Or App 690, 60 P3d 1076 (2002), Sup Ct review denied

Date on which construction firm begins clearing existing structures from property in preparation to build new structures is date on which improvement commenced. SERA Architects, Inc. v. Klahowya Condominium, LLC, 253 Or App 348, 290 P3d 881 (2012), Sup Ct review denied

Law Review Citations

41 WLR 95 (2005)

87.001
Short title
87.005
Definitions for ORS 87.001 to 87.060 and 87.075 to 87.093
87.007
Protection from construction liens perfected after sale of residential property completed
87.010
Construction liens
87.015
Land and interests therein subject to lien
87.018
Delivery of notices
87.021
Notice to owners
87.023
Notice of right to lien
87.025
Priority of perfected liens
87.027
Right of owner to demand list of services, materials, equipment and labor
87.030
Effect of owner’s knowledge of improvement
87.035
Perfecting lien
87.036
Subcontractor’s perfection of claim of lien
87.037
Prohibition against claim of lien
87.039
Notice of filing claim of lien
87.045
Completion date of improvement
87.050
Recording
87.055
Duration of lien
87.057
Notice of intent to foreclose
87.060
Foreclosure
87.070
Amount of recovery by contractor
87.075
Exemption of building materials from attachment by third persons
87.076
Bond or deposit of money
87.078
Notice of filing bond or depositing money
87.081
Filing affidavit with county officer
87.083
Foreclosure after filing of bond or deposit of money
87.086
Determination of adequacy of bond
87.088
Release of lien or return of money
87.089
Limitations on actions
87.093
Information Notice to Owner
87.142
Definitions for ORS 87.142 to 87.490 and 87.910
87.146
Priorities of liens
87.152
Possessory lien for labor or material expended on chattel
87.156
Innkeeper’s lien
87.159
Lien for care of impounded animal
87.162
Landlord’s lien
87.166
Attachment of liens
87.172
Time period before foreclosure allowed
87.176
Fees for storage of chattel
87.177
Bond or deposit of money for lien for storage of chattel
87.178
Foreclosure after filing of bond or deposit of money
87.179
Determination of adequacy of bond
87.181
Release of lien or return of money
87.182
Effect of prior security interest on method of foreclosure
87.186
Location of foreclosure sale
87.192
Notice of foreclosure sale to lien debtor
87.196
Notice of foreclosure sale to secured parties
87.202
Statement of account of foreclosure sale
87.206
Disposition of proceeds of foreclosure sale
87.212
Liability for improper sale of fungible chattels
87.214
Disposal of property left with launderer or dry cleaner
87.216
Nonpossessory lien for labor or material expended on chattel
87.222
Logger’s, woodworker’s and timberland owner’s lien
87.226
Agricultural services lien
87.228
Effect on agricultural services lien when payment for produce is made prior to filing of lien claim
87.232
Fishing lien and fish worker’s lien
87.236
Attachment of liens
87.242
Filing notice of claim of lien
87.246
Recording
87.252
Notice to owner and holders of security interests
87.256
Limitation on extent of liens
87.262
Foreclosure
87.266
Duration of liens
87.272
Petition for foreclosure without suit
87.276
Evidence admissible
87.282
Waiver of right to hearing before filing of petition
87.288
Show cause order
87.296
Waiver of right to hearing after issuance of show cause order
87.302
Authority of court on sustaining validity of lien claim
87.306
Foreclosure by sale without suit
87.312
Effect of notice of foreclosure sale to secured parties
87.316
Disposition of proceeds of foreclosure sale
87.322
Effect of prior security interest on foreclosure of nonpossessory lien for labor or material expended on chattel
87.326
Protection from theft and damage of chattel subject to lien
87.332
Injury or removal of chattel subject to lien
87.336
Costs and attorney fees in foreclosure by suit
87.342
Bond, letter of credit or deposit of money to discharge lien on chattel
87.346
Filing certificate of lien satisfaction upon payment of claim
87.352
Mining labor and material lien
87.356
Lien for preparing land for irrigation or cultivation
87.358
Nurseryman’s lien
87.362
Irrigation power lien
87.364
Attachment of liens
87.366
Filing notice of claim of lien
87.372
Recording
87.376
Duration of liens
87.382
Foreclosure
87.386
Costs and attorney fees in foreclosure
87.392
Priorities of liens
87.430
Attorney’s possessory lien
87.435
Bond, letter of credit or deposit of money to discharge attorney’s possessory lien
87.440
Determination of adequacy of bond or letter of credit
87.445
Attorney’s lien upon actions and judgments
87.450
Filing notice of claim of lien on judgment for sum of money
87.455
Filing notice of claim of lien on judgment for possession of personal property
87.460
Filing of notice of claim of lien on judgment for possession of real property
87.465
Effect of failure to file notice of claim of lien
87.470
Contents of notice of claim of lien
87.475
Effect of settlement on attorney’s lien
87.480
Attorney’s right and power over actions and judgments
87.485
Attorney fees
87.490
Priority of attorney’s lien upon actions and judgments
87.501
Definitions for ORS 87.501 to 87.542
87.503
Lien for long term care
87.507
Perfecting lien
87.512
Contents of notice of lien
87.517
Recording notice of lien
87.522
Foreclosure of lien
87.527
Limitations on property subject to lien
87.533
Assets and income that are exempt from lien
87.537
Duration of lien
87.539
Discharge or release of lien claim
87.542
Priority of lien
87.555
Hospitals, physicians, physician assistants and nurse practitioners as lien claimants
87.560
Limitations on extent of lien
87.565
Notice of lien required
87.570
Form of notice
87.575
Lien docket
87.581
Liability of person or insurer to hospital, physician, physician assistant or nurse practitioner
87.585
Foreclosure
87.603
Definitions for ORS 87.603 to 87.633
87.607
Ambulance services lien
87.613
Notice of lien required
87.617
Form of notice
87.623
Notices recorded in lien docket
87.627
Payment after notice of lien
87.633
Foreclosure
87.685
Definitions for ORS 87.685 to 87.695
87.686
Rental agreement
87.687
Self-service storage facility owner’s possessory lien
87.689
Notice of foreclosure and sale
87.691
Sale of property subject to lien
87.693
ORS 87.687 as exclusive law for creating lien
87.694
Late fee
87.695
Short title
87.700
Definitions for ORS 87.228 and 87.700 to 87.736
87.705
Agricultural produce lien
87.710
Filing notice of lien
87.715
Priority
87.725
Foreclosure
87.730
Expiration of lien for failure to bring timely foreclosure suit
87.735
Filing certificate of lien satisfaction upon payment for produce
87.736
Form of notices filed under ORS 87.710 and certificates filed under ORS 87.735
87.750
Definitions for ORS 87.750 to 87.777
87.755
Grain producer’s lien
87.762
Filing notice of lien
87.767
Form of notice
87.772
Expiration of lien for failure to bring timely foreclosure action
87.777
Filing certificate of lien satisfaction upon payment for grain
87.806
Filing of federal tax liens
87.811
Certification of tax lien notices
87.816
Keeping of index and files with respect to tax liens
87.821
Filing and indexing fee
87.826
Construction
87.831
Short title
87.855
Lien for contributions to employee benefit plan
87.860
Filing of claim of lien
87.865
Foreclosure
87.870
Definitions for ORS 87.870 to 87.876
87.872
Lien for mold created or work performed with mold
87.876
Sale of mold
87.910
Cost of preparing lien notice
87.920
Recording of document not to create lien, affect title or constitute notice except as authorized by law
87.930
Secretary of State to furnish list of persons who have filed financing statement
Green check means up to date. Up to date