Construction Law

In October 2023, the Pennsylvania Superior Court handed down a decision that sent ripples through the construction and equipment rental industries. In R.A. Greig Equipment Company v. Mark Erie Hospitality, LLC, the court affirmed that rental equipment—even when critical to a construction project—did not qualify as “materials” under the state’s Mechanics' Lien Law.¹ As a result, a equipment lessor was left without a mechanics lien to secure its $190,000 claim.

Now, a bill circulating in the Pennsylvania House seeks to right this wrong. The proposed legislation would revise the Mechanics' Lien Law of 1963 to explicitly include rental equipment as lienable material.² This move is not merely procedural; it represents a long-overdue modernization of the law that could significantly affect contractors, developers, and especially the rental equipment companies who keep construction projects moving.

The Greig Decision: A Legal Wake-Up Call

In Greig, the appellant, R.A. Greig Equipment Company, had leased a telehandler—a type of telescopic forklift—to a contractor working on a hotel construction project in Erie. The equipment was damaged on-site, and when rental payments and replacement costs went unpaid, Greig filed a mechanics' lien. However, both the trial court and the Superior Court found that because the equipment was neither consumed nor incorporated into the final construction, it did not meet the statutory definition of "materials.”³

The court relied in part on the 1923 precedent Hoffman Lumber Co. v. Gibson, where the Pennsylvania Supreme Court denied lien rights for lumber used in temporary scaffolding because it was not a permanent part of the structure.⁴ In both cases, the courts adhered strictly to the statutory language, which defines materials as items "incorporated into the improvement."

This rigid interpretation puts Pennsylvania at odds with the practical realities of modern construction. Rental equipment is often essential for grading, lifting, and transporting materials. It may not become part of the building, but without it, the building doesn’t go up. The proposed legislation would close this gap in the law.

A Regional Contrast: Ohio and West Virginia

Neighboring states have already addressed this issue by statute. Ohio’s law provides lien rights for machinery and equipment “furnished in furtherance of an improvement.”⁵ Similarly, West Virginia law specifically states that anyone furnishing machinery or equipment “necessary to the completion" of a construction project is entitled to a lien.⁶

Many companies in the region operate across state lines. As it stands, equipment owners who lease construction equipment have fewer rights on Pennsylvania projects than they would have in neighboring states.

Leveling the Playing Field: What the Legislation Would Do

The language of HB 1319 would add lien rights for suppliers of “rented equipment reasonably necessary for the construction,” clarifying that rental machinery used on a jobsite—regardless of whether it is incorporated into the physical structure—may qualify for protection. This would harmonize Pennsylvania law with those of Ohio and West Virginia, where similar protections already exist.

In addition to legal parity, this reform would bring much-needed clarity to all parties involved in construction projects. Currently, suppliers face uncertainty about whether their rental agreements will be enforceable through lien rights, making it harder to assess credit risk or determine whether to extend equipment to certain jobs. Codifying the right to lien would reduce the need for litigation and enhance confidence in the enforceability of commercial obligations.

Moreover, clearer lien protections can improve financing options. When rental companies have defined lien rights, they are more attractive to lenders, investors, and bonding agencies. This means greater access to capital and more competitive pricing for contractors and developers who rely on equipment vendors. In this way, the legislation not only remedies an inequity, but also strengthens the construction ecosystem as a whole.

Practical Impacts Across the Industry

For rental companies, the change would be transformative. These businesses often provide expensive equipment on long-term rentals, relying on lien rights to secure their investments. Without the ability to file a lien, their risk exposure increases dramatically. As Greig demonstrated, even when equipment is essential to a job, non-payment can go unremedied.

Contractors and developers would also benefit from increased clarity. The current law creates uncertainty about what obligations are lienable. With clearer statutory language, all parties would know where they stand, reducing litigation and improving payment flows.

Property owners, while perhaps wary of expanded lien rights, would gain from a more stable supply chain. If rental companies pull back from projects due to risk, the entire construction process suffers.

A Matter of Fairness and Modernization

At its core, the proposed legislation reflects a broader effort to align the law with the realities of 21st-century construction practices. The current statute, rooted in outdated assumptions about what constitutes a "material," fails to account for how construction projects are actually executed today—often with the aid of large, sophisticated, and costly machinery provided by third-party vendors.

Recognizing rental equipment as lienable work acknowledges the essential role these suppliers play in delivering completed structures. It treats equipment providers with the same respect and legal recognition afforded to those who deliver bricks or beams. This is not a matter of extending special rights, but of correcting an oversight that leaves vital participants in the construction economy unfairly exposed.

In modern construction, the boundary between materials and equipment is no longer meaningful. A concrete mixer may not remain on site when the work is done, but it is just as critical to the finished project as the concrete it helps pour. By modernizing the lien law, Pennsylvania can ensure its legal framework reflects this reality—fairly distributing risk and reward among all contributors to a project’s success.

With HB 1319, Pennsylvania has the opportunity to embrace both fairness and functionality, fostering a more predictable and equitable construction environment for all stakeholders.

In doing so, the Commonwealth would send a strong signal that it supports its construction industry and the many vendors, workers, and businesses that make it possible. The Greig case illuminated a problem. Now it’s time for the legislature to deliver the solution.

Contact the Construction Group at Bowles Rice for legal guidance on how HB 1319 and other upcoming legislation may affect your company’s operations and compliance obligations.

¹ R.A. Greig Equipment Co. v. Mark Erie Hospitality, LLC, 305 A.3d 56 (Pa. Super. Ct. 2023).

²HB 1319. https://www.palegis.us/legislation/bills/text/PDF/2025/0/HB1319/PN1490

³ 49 P.S. § 1201(7).

⁴ Hoffman Lumber Co. v. Gibson, 276 Pa. 79, 119 A. 741 (1923).

⁵ Ohio Rev. Code Ann. §1311.01(I) (including "tools, equipment, or machinery" in definition of materials).

⁶ W. Va. Code §38-2-3 (providing lien rights to those furnishing "machinery or equipment necessary to the completion" of the project).