No. The construction workers who finished the building get paid first. The court explained that a worker's right to get paid (their 'lien') starts the moment the first shovel hits the ground for the entire project. It doesn't matter if some workers started later. All workers on the same project are treated as one group, and their right to get paid comes before a bank that lends money after the project has already started. The bank should have known that more workers would be needed to finish the building, so it can't cut in line ahead of them.

Yes, the people who built the hotel or provided materials have a right to be paid first, even if they did the work after the hotel company promised the hotel as a guarantee for the bonds. This is because when someone starts building something big like a hotel, it's like a starting gun for a race - from that moment on, anyone who helps build it gets a special right to be paid. This right is so important that it's even in our state's constitution. We think this is fair because when someone lends money for a building that's not finished yet, they should expect that more work will need to be done and more people will need to be paid. If we didn't do it this way, it would be really hard to build big things without paying for everything upfront with cash, which most people can't do. So, all the companies that helped build this hotel should have an equal chance to be paid from the value of the whole hotel and the land it's on.

No. A deed of trust recorded after construction begins is subordinate to all mechanic's liens arising from that continuous construction project, even for work performed after the deed's recording. The court reasoned that the controlling statute uses the term 'inception of the lien' to define priority. This 'inception' is not when an individual contractor begins their specific work, but when the overall construction project itself first commences. The legislature's change of statutory language from 'accrual' to 'inception' signaled an intent to have all liens for a single project relate back to this starting point. Consequently, all mechanics and materialmen on a single project stand on an 'equal footing,' sharing a priority date from the beginning of construction. A lender who takes a mortgage on a property where construction is visibly in progress is on notice that future liens will arise to complete the project and cannot gain priority over them.

Yes. The mechanics' liens have priority over the deed of trust, even though they arose from work performed after the deed's execution. This is because the inception of all mechanics' liens occurs when construction of a building begins, not when each individual contractor performs their work. I reach this conclusion for several reasons. First, the Texas Constitution guarantees mechanics, artisans, and materialmen a lien for their work, and the legislature is mandated to provide for efficient enforcement of these liens. Second, the statute puts all mechanics' liens on equal footing, regardless of when the work was performed. Third, the deed of trust in this case anticipated ongoing construction and explicitly provided for the possibility of such liens. Fourth, interpreting the statute to give priority to intervening mortgages would lead to impractical and unjust results, making it nearly impossible to construct large buildings without cash payments. Finally, this interpretation is consistent with the entire body of Texas statute law on the subject and preserves the rights of all those who contribute to the construction of a building. Therefore, all the mechanics' lien holders in this case are entitled to have their liens foreclosed on the entire property, with the proceeds distributed pro rata if insufficient to pay all claims in full.

Oriental Hotel Company v. Griffiths

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