Oklahoma provides significant protection for contractors and material providers for construction projects. An unpaid contractor may file what is known as a mechanics and materialman’s lien. 42 O.S. § 141 et seq. The lien then provides that when the property is sold (or-refinanced) that the lien-holder will be paid depending upon the priority of the lien and the availability of funds. A lien holder may also foreclose upon the lien and force a judicial sale of the property. The lien provides priority, not from the date of filing, but from the date that the first material was provided or service performed. Fourth Nat’l. Bank of Tulsa v. Appleby, 1993 OK 53, ¶ 9, 864 P.2d 827. And naturally, the lien holder also retains all rights to an in personam judgment against whoever contracted to pay for the work and material.
But in Indian Country, a right created by Oklahoma statutes to a construction lien, does not apply. Indian Country lies within the jurisdiction of a sovereign tribal government a state’s law will only apply with specific Congressional authorization. Congress has not stated that state-law lien rights apply. There is nothing, however, to prevent a Tribe from legislating its own lien process and rights. In such a scenario, the Tribe would have to provide a method to file the lien with the tribal government or court to provide a central place for interested parties to research lien filings. But, even if a Tribe did legislate and create a registry for lien flings there would be two additional hurdles. First, all land within the jurisdiction of the an Indian tribe is restricted in some fashion. Much of it is trust land where title is held by the United States for the benefit of the Tribe. If the Tribe were to allow a lien-filing on its own land, the contract approving that lien would likely have to be approved by the Bureau of Indian Affairs under 25 U.S.C. § 81 which requires the U.S. to approve of mortgages on Indian lands. Second, if it is owned by an Indian tribal member and not the Tribe or the United States, it is likely still restricted against alienation to non-Indians, meaning that Bureau of Indian Affairs would again have to approve. Finally, even if the Tribe and Bureau of Indian Affairs approved of the creation of a lien on land owned by the Tribe (or the U.S. for benefit of the Tribe), a lien itself is not likely a clear waiver of sovereign immunity by the Tribe. Meaning, that judicial foreclosure in tribal court may not be available, depending upon how the tribal court interprets a tribal statute providing for lien rights.
The end-result. When entering into contracts to perform construction on Indian Country, a construction company or material provider should understand that state-law lien rights do not apply. The contractor should further endeavor to determine what rights, if any, exist under tribal law, and ensure that its contracts provide for remedies in the proper tribal forum.
