Can a septic tank pumping company file a construction lien on a homeowner's property for unpaid service charges?
Plain-English summary
The Construction Contractors Board asked whether a company that locates, unearths, drains, and pumps a residential septic tank can file a construction lien against the homeowner's property for the labor performed. Chief Counsel Donald Arnold said no.
Oregon's construction-lien statute (ORS 87.010) reached two activities: construction of an "improvement" and "preparation of land" for construction. The opinion concluded that routine septic servicing fits neither. Pumping out a tank is not building, altering, or repairing an existing structure, and it does not prepare land for new construction. The opinion left open one wrinkle: if the same crew also repaired the tank in the course of servicing it, that repair work could become lienable.
Currency note
This opinion was issued in 1998. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.
Common questions
Q: Why doesn't routine septic pumping count as "repair"?
A: The AG borrowed the dictionary definition: to "repair" something means to fix or mend it. Pumping waste out of a working tank does not fix or mend anything. The tank is functioning before and after the service.
Q: When would septic work be lienable?
A: If the work includes actual repair of the tank itself, such as patching, replacing parts, or rebuilding the structure, that portion of the work could create a construction lien. The opinion also implies that installing a new septic system is lienable as construction of an improvement.
Q: Was the septic tank itself an "improvement" under the statute?
A: Yes. The court precedent (Abajian v. Hill) treats "other structures" under ORS 87.005(5) broadly, covering anything that adds relatively permanent value or utility to the land. A buried septic tank fits.
Q: What about "preparation of land"?
A: ORS 87.010(2) creates a lien for work preparing a lot or parcel for construction (excavating, surveying, demolition, leveling). Pumping a working septic tank is maintenance of an existing system, not preparation of land for a new project.
Q: What recourse does an unpaid septic company have, then?
A: A standard contract action for the unpaid invoice. The opinion ruled out one specific remedy (a construction lien recorded against the property); it did not address other collection options.
Background and statutory framework
ORS 87.010 grants two kinds of construction liens. Subsection (1) covers labor and materials used in "the construction of any improvement," where construction means creating, altering, or repairing the improvement and improvement is broadly defined under ORS 87.005(5) to include any structure or superstructure adding permanent value to land. Subsection (2) covers labor used in "preparation of a lot or parcel of land," defined in ORS 87.005(9) to include excavating, surveying, landscaping, demolition, and detachment of existing structures.
Oregon courts have read "other structures" expansively (Abajian v. Hill, 1979; McCormack v. Bertschinger, 1925), so the AG had to focus the analysis on whether the activity was construction-related, not whether the tank was an improvement. The opinion concluded that cleaning the contents of an existing structure neither builds nor repairs nor prepares anything for construction.
Citations and references
Statutes:
- ORS 87.010, construction liens
- ORS 87.005(2), definition of construction
- ORS 87.005(5), definition of improvement
- ORS 87.005(9), definition of preparation of land
Cases:
- Miller v. Ogden, 134 Or App 589, 896 P2d 596 (1995), aff'd 325 Or 248 (1997), distinguishing construction process from improvement product
- McCormack v. Bertschinger, 115 Or 250, 237 P 363 (1925), driveway and retaining wall as improvements
- Abajian v. Hill, 42 Or App 695, 601 P2d 837 (1979), broad reading of "other structures"
- Robison v. Thatcher, 252 Or 603, 451 P2d 863 (1969), lien protection for component work
Source
- Landing page: https://www.doj.state.or.us/oregon-department-of-justice/office-of-the-attorney-general/attorney-general-opinions/
- Original PDF: https://www.doj.state.or.us/wp-content/uploads/1998/03/op1998-1.pdf
Original opinion text
March 31, 1998
Craig P. Smith, Deputy Administrator
Construction Contractors Board
700 Summer Street NE, Suite 300
P.O. Box 14140
Salem, OR 97309-5052
Re: Opinion Request OP-1998-1
Dear Mr. Smith:
You ask whether the activity of locating, unearthing the opening, draining and pumping residential septic
tanks can create a construction lien for the labor used in performing the work. We conclude that this
activity cannot be the basis for a construction lien because servicing septic tanks does not involve the
construction of an improvement or the preparation of land for construction.
Discussion
Construction liens are authorized by ORS 87.010, which provides in relevant part:
(1) Any person performing labor upon, transporting or furnishing any material to be used in
* * * the construction of any improvement shall have a lien upon the improvement for the
labor, transportation or material furnished * * * at the instance of the owner of the
improvement * * .
(2) Any person who engages in * * * the preparation of a lot or parcel of land, * * * at the
request of the owner of the lot or parcel, shall have a lien upon the land for work done * * .
(Emphasis added.) Below, we analyze whether the activity of servicing septic tanks may be categorized
as either "the construction of any improvement" or "the preparation of a lot or parcel of land."
1. Construction of an Improvement
In Oregon, a person who performs "construction of any improvement" to an owner's property may use a
construction lien to recover costs. ORS 87.010(1). "Construction" is defined as including:
creation or making of an improvement, and alteration, partial construction and repairs done
in and upon an improvement.
ORS 87.005(2). "Improvement" is defined as:
any building, wharf, bridge, ditch, flume, reservoir, well, tunnel, fence, street, sidewalk,
machinery, aqueduct and all other structures and superstructures, whenever it can be made
applicable thereto.
ORS 87.005(5).
Thus, "construction" refers to the process, i.e., the act of building, altering or repairing; whereas,
"improvement" refers to the product the work creates or changes, i.e. the structure. Miller v. Ogden, 134
Or App 589, 597, 896 P2d 596 (1995), aff'd 325 Or 248 (1997).
An improvement includes not only the listed structures, e.g., building, wharf, but "all other structures."
ORS 87.005(2). The courts have broadly interpreted "other structures" to encompass other projects with
characteristics similar to those listed in the statute, such as a driveway and retaining wall, McCormack v.
Bertschinger, 115 Or 250, 237 P 363 (1925), and a log dump, Abajian v. Hill, 42 Or App 695, 601 P2d
837 (1979). In Abajian, the court commented on the characteristics of improvements and other
structures, stating:
the pertinent * * * characteristics of * * * improvements are that they are additions to the
land of a relatively permanent nature which increase the value or utility of the land. Thus,
the statutory phrase "other structures" is more flexible than Cinderalla's slipper; it covers
improvements with those characteristics.
Id. at 700.
A residential septic tank is an "other structure" within the meaning of "improvement." The question is
whether the activity of servicing (locating, unearthing the opening, draining and pumping) a residential
septic tank constitutes the "construction of an improvement" under ORS 87.010(1). We conclude that it
does not.
Servicing a septic tank involves cleaning out an existing structure; it does not create or build a new
structure. Nor does servicing involve alteration, reconstruction or repair of an existing structure. "Repair"
means "to restore by replacing a part or putting together what is torn or broken." Webster's Third New
International Dictionary 1923 (unabridged 1993). Repairing something is the same as fixing or mending
that thing.(1) The work at issue here does not involve fixing or mending a septic tank, but simply cleaning
out what is in the tank. If the person servicing the septic tank were also to repair that tank, however, then
the work could be construction of an improvement and subject to lien.
2. Preparation of Land
Under ORS 87.010(2), a lien is also created when a person is engaged in work for "the preparation of a
lot or parcel of land." Preparation includes:
excavating, surveying, landscaping, demolition and detachment of existing structures,
leveling, filling in, and other preparation of land for construction.
ORS 87.005(9). Allowing "preparation" projects to be lienable assures contractors (and subcontractors)
that their right to recover costs for work done on component undertakings in the construction will be
protected the same as if the work were done on the finished building. See Robison v. Thatcher, 252 Or
603, 605, 451 P2d 863 (1969).
To determine whether a project involves "preparation," courts analyze how or in what way the project
contributes to the larger project of construction. See Abajian, at 698. If the project contributes to
preparation of land for construction, the project is lienable. Id. at 699. Because servicing septic tanks is
not preparing land for construction, septic tank servicing does not come within ORS 87.010(2).
Sincerely,
Donald C. Arnold
Chief Counsel
General Counsel Division
- "Repairs" is also defined as:
the portion of maintenance charges expended to keep fixed assets in adequate and efficient operating condition and recorded on the books as expense - contrasted with renewal and replacement.
Webster's Third New International Dictionary 1923 (unabridged 1993).
This definition relates to "charges" and "expenses" and is not directly relevant to the type of "repairs" referenced in ORS 87.005(2).