Pennsylvania Mechanics’ Lien Law Update: Proposed Legislation to Expand Definition of 'Materials' to Include Equipment Rentals

If applicable, Pennsylvania Mechanics’ Lien Law, 49 P.S. §§ 1101, et seq. (the Lien Law) provides contractors and subcontractors with a lien for debts due for “labor or materials furnished in the erection or construction” of an improvement to real property.^[1] “Materials” are defined as “building materials and supplies of all kinds, and also include fixtures, machinery and equipment reasonably necessary to and incorporated into the improvement.”^[2] While the Lien Law requires strict interpretation, decades have passed since an appellate court has addressed whether rental charges for construction equipment, such as trucks and excavators that are not incorporated into the real property, may be the subject of a mechanics’ lien claim.

In 2023 and 2024, however, the Superior Court of Pennsylvania addressed this issue twice. First, in R.A. Greig Equipment Co. v. Mark Erie Hospitality, LLC,^[3] the Superior Court affirmed a trial court’s dismissal of a mechanics’ lien that sought to secure a debt for rental charges for a leased telescopic forklift used in construction, as the equipment did not meet the Lien Law’s definition of “materials.” Thus, the mechanics’ lien claim was invalid. Relying upon the 1923 case Hoffman Lumber Co. v. Gibson, the Greig court held that “materials” must be “reasonably necessary” in the construction of the building and “‘incorporated into the improvement’ i.e., actually used in the building structure.”^[4] Of note, the court held “as a matter of law, the [leased construction equipment] and rental payments do not constitute materials” under the Lien Law.^[5]

Next, in 2024, the Superior Court again addressed the issue in Cleveland Brothers Equipment Co., Inc. v. Arcadia North Land, LLC.^[6] The Cleveland Brothers case dealt with whether a claimant could assert a mechanics’ lien claim to secure unpaid rental charges related to an excavator used for site preparation and grading. In applying Greig’s definition of “materials,” the Superior Court reversed a trial court’s grant of summary judgment in favor of the lienor and struck the lien claim. To distinguish its claim from the one in Greig, the claimant in Cleveland Brothers argued that, unlike Greig, its mechanics’ lien claim involved rental equipment that was “necessary” to the construction work.^[7] Citing the Lien Law’s express wording, the Cleveland Brothers court found that the factual difference was “irrelevant to the statutory analysis,” which requires incorporation into the improvement.^[8]

One response to the rulings in Greig and Cleveland Brothers has been an attempt to expand the Lien Law’s definition of “materials.” Specifically, House Bill 1319 (HB 1319) proposes to amend the Lien Law’s definition of “materials” to mean “building materials and supplies of all kinds, and also includes fixtures, machinery and equipment, including rented equipment reasonably necessary [to and] for the construction of or incorporated into the improvement.”^[9] The addition of “for the construction of” before “the improvement” may present a significant expansion of mechanics’ lien rights for a host of creditors. As a result, industry participants ought to monitor HB 1319 and consider appropriate risk management processes should it become law.

It is important to note that both Greig and Cleveland Brothers dealt squarely with claims for “materials” in the form of rental charges and expenses. These cases did not address lien rights for those providing “labor” or any other potentially lienable item under the Lien Law in conjunction with the use of rental equipment.^[10]

Co-author Gaetano Piccirilli, partner, and Haley Platt, law clerk, are members of the Litigation Department at Klehr Harrison. 

[1] 49 P.S. § 1301(a).

[2] 49 P.S. § 1201(7) (emphasis added).

[3] R.A. Greig Equip. Co. v. Mark Erie Hosp., LLC, 305 A.3d 56 (Pa. Super. 2023).

[4] Id. at 61.

[5] Id. at 61–62. The Greig court looked at the lien laws of jurisdictions that require such equipment become a permanent part of the property as improved to maintain a lien.

[6] Cleveland Brothers Equip. Co., Inc. v. Arcadia N. Land, LLC, 331 A.3d 603, 2024 WL 4664445 (Pa. Super. 2024), appeal granted, 337 A.3d 963 (Pa. 2025).

[7] Id. at *4.

[8] Id.

[9] H.B. 1319 (emphasis added to modified language).

[10] See Cleveland Brothers, 2024 WL 4664445, at *3.