Calculate the lien amount a subcontractor can claim for unpaid work totaling $15,000 on a project where the total contract value is $85,000 and the remaining balance owed to the general contractor is $8,000:
Correct Answer
B) $8,000
Under Tennessee lien law, a subcontractor's lien cannot exceed the amount remaining due to the general contractor, which is $8,000.
Why This Is the Correct Answer
Under Tennessee lien law, a subcontractor's lien is capped at the amount still owed by the owner to the general contractor at the time the lien is filed. Even though the subcontractor is owed $15,000, only $8,000 remains unpaid to the GC, so $8,000 is the maximum claimable lien amount.
Why the Other Options Are Wrong
Option A: $15,000
$15,000 is the actual amount owed to the subcontractor, but Tennessee law does not allow a subcontractor to recover more from the owner than what the owner still owes the GC. The subcontractor's lien is limited to the unpaid GC balance, not the full unpaid sub amount.
Option C: $23,000
$23,000 is the arithmetic sum of the subcontractor's claim ($15,000) and the remaining GC balance ($8,000), but lien law does not add these figures together. The subcontractor's exposure is capped at the lower of what is owed to the sub or what the owner owes the GC.
Option D: $85,000
$85,000 is the total contract value between the owner and GC, which has no bearing on what a subcontractor may lien. The lien cap looks only at the unpaid balance remaining on the prime contract, not the full contract amount.
Memory Technique
Think of the subcontractor's lien as a straw inserted into the GC's unpaid bucket. The sub can only sip what is still in that bucket — no more. If the bucket is already empty ($0 owed to GC), the straw draws nothing.
More Tennessee Questions
Calculate the Tennessee workers' compensation premium for a roofing contractor with a $180,000 annual payroll and a rate of $28.50 per $100 of payroll:
How many hours of continuing education are required for Tennessee contractor license renewal?
Calculate the workers' compensation experience modification factor for a contractor with $85,000 in expected losses and $68,000 in actual losses:
Under Tennessee lien law, what is the maximum time limit to enforce a mechanics lien after it has been filed?
Under Tennessee lien law, which party has priority when multiple liens are filed against the same property?
Under Tennessee building codes, what is the maximum allowable deflection for a residential floor joist with a 16-foot span under live load?
A homeowner in Nashville hires an unlicensed contractor for $8,000 worth of electrical work. The contractor demands payment but the work fails inspection. Under TCA 62-6, what recourse does the unlicensed contractor have?
Under Tennessee building codes, what is the minimum ceiling height required for habitable rooms in residential construction?
A Tennessee contractor has 8 employees working on a residential project. The total weekly payroll is $6,400. If the workers' compensation rate for residential construction is $8.50 per $100 of payroll, what is the weekly workers' compensation premium?
A contractor is installing a septic system for a new home in rural Tennessee. The estimated cost is $8,500. According to TCA 62-6, what licensing requirement applies?
People Also Study
Business & Financial Management
120 questions · 70% to pass
Contract Administration
60 questions · 70% to pass
Project Management
60 questions · 70% to pass