N.Y. Lien Law Section 25
Priority of liens and assignments under contracts for public improvements

Parity of liens of same class. In an action to enforce a lien under a contract for a public improvement, or an assignment of moneys, or any part thereof, due or to become due under such contract, parties having liens and parties having assignments unless such assignments be set aside as diversions of trust assets as provided in article 3-A (Definition and Enforcement of Trusts)article three-a of this chapter shall have priority as follows:

(1)

. Except as provided in section five an assignee of moneys, or any part thereof, due or to become due under a contract for public improvement, whose assignment is duly filed prior to the filing of a notice of lien or assignment of every other party to the action, shall have priority over those parties to the extent of advances made upon such assignment before the filing of the notice of lien or assignment next subsequent to his assignment, but as to advances made subsequent to a notice of lien or assignment filed and unsatisfied or not discharged such assignee for the purpose of determining his proportionate share of moneys available for distribution as provided in subdivision four of this section shall be treated as a lienor having a lien to the extent of advances so made.

(2)

An assignee of moneys or any part thereof, due or to become due under a contract for a public improvement whose assignment is duly filed subsequent to the filing of the notice of lien or assignment of any other party shall for the purpose of determining his proportionate share of moneys available for distribution, as provided in subdivision four of this section be treated as a lienor having a lien to the extent of advances actually made upon such assignment prior to the filing thereof.

(3)

Laborers for daily or weekly wages having liens under a contract for a public improvement, shall have preference as a class for the full amount of their unpaid wages over all other lienors having liens arising under the same contract and without reference to the time when such laborers shall have filed their notices of liens.

(4)

There shall be no priority among labor lienors, as a class or among other lienors as a class, and any moneys available for distribution among lienors of any class shall be distributed pro rata in accordance with their respective valid liens.

(5)

Every assignment of moneys, or any part thereof, due or to become due under a contract for a public improvement shall contain a covenant by the assignor that he will receive any moneys advanced thereunder by the assignee and will hold the right to receive such moneys as a trust fund to be first applied to the payment of trust claims as defined in Lien Law § 71 (Purpose of the trust)section seventy-one of the lien law, and that he will apply the same to such payments only, before using any part of the moneys for any other purpose.

Source: Section 25 — Priority of liens and assignments under contracts for public improvements, https://www.­nysenate.­gov/legislation/laws/LIE/25 (updated Sep. 22, 2014; accessed Oct. 26, 2024).

3
Mechanic’s lien on real property 4
Extent of lien 4‑A
Insurance proceeds liable for demands 5
Liens under contracts for public improvements 6
Liens for labor on railroads 7
Liability for advance payments, collusive mortgages and incumbrances 8
Terms of contract may be demanded 9
Contents of notice of lien 10
Filing of notice of lien 11
Service of copy of notice of lien 11‑A
Notice of completion and acceptance may be demanded 11‑B
Copy of notice of lien to a contractor or subcontractor 11‑C
Copy of notice of lien to a contractor or subcontractor with respect to public improvements liens 12
Notice of lien on account of public improvements 12‑A
Amendment 13
Priority of liens 14
Assignment of lien 15
Assignments of contracts and orders to be filed 16
Assignment of contracts and orders for public improvement to be filed 17
Duration of lien 18
Duration of lien under contract for a public improvement 19
Discharge of lien for private improvement 20
Discharge of lien after notice of lien filed by payment of money into court 21
Discharge of lien for public improvement 21‑A
Vacating lien for a public improvement, by order of court 22
Building loan contract 23
Construction of article 24
Enforcement of mechanic’s lien 25
Priority of liens and assignments under contracts for public improvements 26
Subordination of liens after agreement with owner 28
Lien of certain judgments postponed 29
Subordination of liens to subsequent mortgage 30
Subordination of notices of lis pendens 31
Discharge of liens on sale of real property 32
Certain liens and claims not to be affected 33
Certain sections not to apply to laborers’ liens 34
Waiver of lien 35
Waiver of arbitration 37
Bond to discharge all liens 38
Itemized statement may be required of lienor 39
Lien wilfully exaggerated is void 39‑A
Liability of lienor where lien has been declared void on account of wilful exaggeration 39‑C
Repossession of materials not used
Green check means up to date. Up to date

Accessed:
Oct. 26, 2024

Last modified:
Sep. 22, 2014

§ 25’s source at nysenate​.gov

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