Under Oregon law, construction lien claimants have a “direct” lien. Although the lien arises through the statutory agency of the contractor, for lien claimants other than the contractor, it is independent of the contractor and secures payment to the claimant regardless of whether the owner paid the contractor or whether the contractor waived or released its construction lien rights. In addition, the independent existence of a claimant’s construction lien is unaffected by the contractor’s breaches of its contract with the owner.
The direct lien can be contrasted with the derivative lien, in that the derivative lien depends on the continuing existence of a debt owed by the owner to the contractor. Under derivative lien statutes, the subcontractor’s or supplier’s lien is limited to the amount due the contractor and is extinguished to the extent that the contractor has been paid by the owner. Under this system, the owner can never be compelled to pay more than the contract price due to the contractor. Similarly, any breach of contract by the contractor will adversely affect the lien claim of a subcontractor under a derivative system but will not affect lien rights of a claimant under a direct system like that under Oregon law.