2A:44A-18 Calculation of proportionate share under residential construction.

18. This section shall solely apply to work, services, material or equipment furnished under a residential construction contract. If a lien attaches to an interest in real property, the lien claimant shall release a proportionate share of the interest in real property from the lien upon receipt of payment for that proportionate share. This proportionate share shall be calculated in the following manner:

a. If there is a contract between the lien claimant and the owner or other writing signed by the parties which provides for an allocation by lot or tract, or otherwise, that allocation of the proportionate share shall be binding upon the lien claimant. Absent a contract between the lien claimant and the owner or other writing signed by the parties, any allocation made shall be proportionate to each lot if subdivision approval has been granted or to each tract if no subdivision approval is required or has been granted.

b. If the work performed by the lien claimant was for a condominium in which a master deed is filed before the lien attaches, or for work performed for a cooperative in which a master declaration is filed before the lien attaches, then the proportionate share shall be allocated in an amount equal to the percentage of common elements attributable to each residential unit, subject to the limitations of subsections b. and c. of section 3 of P.L.1993, c.318 (C.2A:44A-3).

c. If subsection a. or b. of this section does not apply, then the lien shall not be released as to any portion of the interest in real property.

d. If a lien claimant receives payment of the proportionate share but refuses to discharge its lien claim, then upon application to a court having jurisdiction thereof, the court shall order the discharge of the lien claim to the extent of that proportionate share. The lien claimant shall be further subject to section 30 of P.L.1993, c.318 (C.2A:44A-30), and any amounts to be paid shall be paid from the amount due the claimant.

L.1993, c.318, s.18; amended 2010, c.119, s.13.