When you complete work on a property and don’t get paid, it’s important to know who is legally responsible. 

Should you take action against the property owner or the leaseholder? 

This article provides clear answers to help you decide which party to sue for unpaid labor and outlines key legal concepts involved in these situations. 

We’ll cover who holds responsibility, what factors to consider, and whether filing a lien might benefit your case.

Who is Responsible for Paying Me: The Owner or the Leaseholder?

What is the Relationship Between Property Owners and Leaseholders?

Property owners and leaseholders have distinct roles. A property owner owns the building or land, while a leaseholder rents or leases the space to use it for personal or business activities. 

This lease often shifts some responsibilities from the owner to the tenant, depending on the terms of their agreement. 

This division of responsibilities can complicate your ability to identify who owes you payment for work performed. 

If a tenant contracts you for a job, the owner might not be involved at all.

How Does Your Contract Affect Who You Should Sue?

The first step is to review your contract or any written agreement. The person or entity that hired you, whether the property owner or the leaseholder, is usually responsible for payment. 

If the leaseholder (tenant) directly contracted you for services, you would generally pursue them for payment. On the other hand, if the property owner hired you to work on the property, the owner would be liable. 

The legal contract governs who should pay, so it’s essential to confirm who signed the agreement with you.

Does the Type of Work Matter When Deciding Who to Sue?

Permanent Improvements vs. Temporary Changes

The type of work you did matters. If your work involves permanent improvements—like major renovations—it could increase the property’s value. In such cases, both the leaseholder and the property owner could have some responsibility for payment. 

For example, if a restaurant leaseholder hires you to remodel the kitchen but stops paying, and the improvements increase the value of the building, you may have grounds to hold the property owner accountable as well.

General Repairs and Maintenance

If your work involves smaller, temporary repairs (like fixing a broken sink or painting a wall), the responsibility for payment usually stays with whoever hired you. 

If the tenant hired you for these minor tasks, the owner would typically not be involved unless stated otherwise in the lease agreement.

What if the Property Owner Did Not Know About the Work?

Can You Sue the Owner If They Weren’t Involved?

It might seem logical to hold the property owner responsible since they own the building, but legally, the owner may not be liable if they didn’t authorize or know about the work. 

In most cases, only the person who signed the contract with you is legally bound to pay. If the leaseholder acted independently, you would need to sue them, not the owner.

Are There Exceptions Where the Owner Can Be Liable?

There are cases where property owners could be held liable even if they didn’t directly hire you. 

For example, if the work was essential for the property’s structure and significantly benefits the owner, some jurisdictions may allow you to file a mechanic’s lien. 

A mechanic’s lien secures your right to payment by placing a claim against the property.

What is a Mechanic’s Lien, and How Can It Help?

How Does a Mechanic’s Lien Work?

A mechanic’s lien is a legal tool that allows contractors, builders, and workers to secure payment by claiming an interest in the property they worked on. 

If you are not paid, you can file a lien, which puts pressure on the property owner because they cannot sell or refinance the property until the lien is resolved.

When Can You File a Mechanic’s Lien?

You can typically file a lien if your work directly improved the property, even if a leaseholder hired you. This is especially useful when the tenant goes bankrupt or disappears without paying. 

If the property owner benefits from your work, the lien may compel them to pay you to clear the title.

How Can You Strengthen Your Case for Unpaid Work?

Collecting Evidence and Documentation

To have a strong case, gather all relevant documents, including signed contracts, invoices, and communication records. 

If you performed work without a formal contract, email exchanges or text messages confirming the job details can also serve as evidence.

Legal Support and Negotiation

Before filing a lawsuit, it may be wise to send a formal demand letter to the responsible party. This letter should detail the amount owed and request payment by a specific date. 

Sometimes, this step alone is enough to resolve the issue. If the responsible party refuses to pay, consulting a lawyer familiar with construction or contract law will help ensure you follow the right legal steps.

Can You Sue Both the Owner and the Leaseholder?

When Should You Include Both in a Lawsuit?

In certain cases, you might be able to sue both the owner and the leaseholder. 

For example, if your work increased the property’s value or both parties were involved in hiring you, including both in the lawsuit could increase your chances of getting paid. 

In other situations, the owner and leaseholder might try to shift responsibility to each other, so suing both could prevent delays.

Risks of Involving Both Parties

While naming both parties in a lawsuit can be helpful, it may complicate the case. If the leaseholder is bankrupt or has no assets, even winning the case might not guarantee payment. Consulting a lawyer will help you determine the best approach for your specific situation.

Pros and Cons Table: Suing the Property Owner vs. Leaseholder

Factor	Suing the Property Owner	Suing the Leaseholder (Tenant)
Ease of identifying liability	May be harder if not directly involved	Easier if they hired you directly
Risk of delayed payment	Lower if the owner is financially stable	Higher if the tenant faces bankruptcy
Likelihood of success	Possible with a mechanic’s lien	High if leaseholder signed the contract
Legal complexity	More complex if owner disputes involvement	Less complex with clear contract terms
Impact on property sale	Lien can block sale or refinance	No lien impact unless owner is involved

What Legal Steps Should You Follow?

Filing a Lawsuit or Small Claims Case

If the unpaid amount is small, you can file a claim in small claims court. This is often quicker and cheaper than a full lawsuit. 

If the amount is large, working with a lawyer to file a lawsuit will be necessary. Be prepared to provide evidence of the contract, completed work, and unpaid invoices.

Deadline for Legal Action

It’s important to act quickly. Many places have time limits (statutes of limitations) for filing lawsuits or liens. Missing these deadlines could prevent you from recovering your money.

Conclusion: Deciding Whether to Sue the Property Owner or Leaseholder

Deciding who to sue—property owner or leaseholder—depends on who hired you and the nature of the work performed. If the leaseholder directly engages your services, they are usually responsible. 

However, if your work improved the property’s value or the owner benefited from it, filing a mechanic’s lien could allow you to pursue both parties. Clear contracts, good documentation, and legal guidance will improve your chances of getting paid for your work.

FAQs

Can I sue the property owner if the leaseholder hired me?

In most cases, you should sue the leaseholder since they hired you. However, if your work improved the property’s value, you may be able to file a mechanic’s lien and hold the owner responsible too.

What if I don’t have a written contract?

Even without a written contract, you can use emails, text messages, or other forms of communication as evidence. These records can show that the leaseholder or owner hired you for the job.

How long do I have to file a mechanic’s lien?

The time limit for filing a lien varies by location, but it usually ranges from 30 to 90 days after completing the work. Check your local laws to avoid missing the deadline.

What happens if the leaseholder goes bankrupt?

If the leaseholder goes bankrupt, filing a mechanic’s lien may still help you recover payment from the property owner, especially if the work added value to the building.

Do I need a lawyer to sue for unpaid work?

While small claims cases may not require a lawyer, having legal guidance is recommended for more complex cases or large amounts of money. A lawyer can help you navigate the process and improve your chances of success.