North Carolina State Lien Law Summary

ON REAL PROPERTY

Furnishers of labor, materials, rental equipment, or professional design or surveying services to the parties listed below. [44A-11.2]

-Person contracting directly with owner. Engineering services are covered. [Ramey Kemp & Associates, Inc. v. Richmond Hills Residential Partners, LLC, 737 S.E.2d 420 (N.C.App.,2013)]

-First-tier sub may enforce contractor’s lien through subrogation, if all steps are followed.

-First-, second- or third-tier subs (including suppliers) may file a claim of lien where (1) they comply with requirements to bring claim against contract funds, AND (2) the owner pays the general or sub anyway, without withholding enough to cover liens. [44A-20]

-Second- and third-tier subs may enforce contractor’s lien via subrogation, even where the first-tier sub has been paid IF the owner still owes money to the contractor and IF the contractor still has lien rights against the owner. This right of claim is limited, however, if, within 30 days after the later of (a) the building permit is issued or (b) the general contractor is awarded the contract, the owner or general contractor posts on the property and files with court clerk a signed Notice of Contract, AND, either (a) the second- or third- tier sub doesn’t serve a Notice of Subcontract, OR, (b) the claimant gives the Notice of Subcontract and the general serves written notice of payment within five days of receiving each payment. [44A-23; Schor at §34.03[C]; Electric Supply Co. v. Swain Elec. Co., 328 N.C. 651, 654, 403 S.E.2d 291, 293 (1991)]

NOTE that where a claimant’s contract exceeds the amount for which the claimant’s license allows it to contract, then the claimant’s recovery (i.e., the total amount the claimant will be entitled to recover on the contract, thus it includes funds received prior to problems arising) will be limited to the amount of its license. [McK Enterprises, LLC v. Levi. 722 S.E.2d 798, Unpublished Disposition (N.C.App., 2012)]

NOTE that if a claimant is supplying a supplier knowing where the product will ultimately be used, and the claimant is selling the product to the supplier specifically for use in that project, then the claimant (a supplier to a supplier) will be able to make a claim. [Queensboro Steel Corp. v. East Coast Mach. & Iron Works, Inc., 346 S.E.2d 248, 82 N.C.App. 182, review denied 349 S.E.2d 865, 318 N.C. 508 (1986); Raleigh Paint & Wallpaper Co. v. Peacock & Associates, Inc., 247 S.E.2d 728, 38 N.C.App. 144 (1978), review denied 251 S.E.2d 470, 296 N.C. 415; Forsyth Memorial Hosp., Inc. v. Armstrong World Industries, Inc., 122 N.C.App. 413, 470 S.E.2d 826 N.C.App. 1996)]

NOTE that unlicensed contractors and subs may file a lien, but they are not entitled to bring a breach of contract claim against an owner. They are also barred from recovering in quantum meruit. They are, however, allowed to bring breach of contract claims against each other. [87-1 et seq.; Voller Realty & Const., Ltd. v. D.V. Holdings, Inc., 687 S.E.2d 318 (N.C.App., 2009); Lato Holdings, LLC v. Bank of North Carolina, 691 S.E.2d 96 (N.C.App.,2010); Builders Supply v. Midyette, 274 N.C. 264, 270, 162 S.E.2d 507 (1968)] Note also that, where the owner is overseeing the project, ordering materials, and coordinating subs, a claimant who contracts directly with the owner will not be considered a general contractor in terms of licensing requirements and the ability to file breach of contract or quantum meruit claims. One of the key factors in determining whether a party is a general contractor is the degree of control they have over the project. [Brown’s Builders Supply, Inc. v. Johnson, 769 S.E.2d 653 (Ct.App. 2015)]

For Notice of Contract, please contact Levy von Beck and Associates for form information.

For Notice of Subcontract, please contact Levy von Beck and Associates for form information. [44A-23]

ON FUNDS DUE CONTRACTOR, SUB, ETC:

First-tier sub that furnishes labor, materials or rental equipment to general can claim a lien against funds owed to the general. A second-tier sub supplying labor, materials or rental equipment can claim against the funds owed to the first-tier sub, and can also be subrogated to first-tier sub’s claim. Case law holds, however, that second-tier subcontractors cannot assert a claim of lien upon funds when no funds are owed to the first-tier subcontractor at or after the time the second-tier subcontractor files its claim of lien. [Electric Supply Co. v. Swain Elec. Co., 328 N.C. 651, 654, 403 S.E.2d 291, 293 (1991); Park East Sales, LLC v. Clark-Langley, Inc., 651 S.E.2d 235 (N.C. App. 2007)] A third-tier sub supplying labor, materials or rental equipment can claim against the funds owed to the second-tier sub, and can also be subrogated to the second-tier or first-tier sub’s claim. To be subrogated, the claimant must give the notice.  Please contact Levy von Beck and Associates for form information.  Furnishers of labor or materials to anyone on project more remote than the second-tier sub cannot be subrogated to higher-tiered subs’ interest. NOTE ALSO if the subcontractor’s lien arises only through subrogation, then the sub is limited to the rights of the contractor, thus the sub’s lien against the contract funds cannot be greater than the amount owed to the general at the time the owner received the claimant’s notice of claim. [Watson Electrical Const. Co. v. Summit Companies, LLC, 160 N.C.App. 647, 587 S.E.2d 87 (2003); O & M Industries v. Smith Engineering Co., 624 S.E.2d 345 (N.C. 2006); 44A-8, 44A-18, 44A-23]

Furnisher of labor or materials to project. [44A-27]. It is clear that those supplying the general, a sub, or a sub-sub are covered; beyond that has not been determined. [HSI North Carolina, LLC v. Diversified Fire Protection of Wilmington, Inc., 611 S.E.2d 224 (2005); Schor at §34.02[D]]

PUBLIC-PRIVATE PARTNERSHIPS:

All providers of labor, materials, or services to the private developer or one or more of its contractors or those contractors’ subcontractors. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIPS, ONSLOW COUNTY:

Contractors, subcontractors (no clear limit as to tier), and providers of labor, materials, utilities, equipment rental. [N.C.2013 Session Laws, 2013-37 (S.B.75), Secs. 1(a) and 1(f)]

REAL PROPERTY:

Improvement and lot it is situated on to extent land is reasonably necessary for convenient use and occupation of building. [44A-9]

FUNDS DUE CONTRACTOR, SUB, SUB-SUB, ETC:

(i.e., party with whom claimant dealt). [44A-18]

CONTRACTOR’S PAYMENT BOND:

[44A-26] NOTE, however, that where the contractor does not provide an adequate bond, a claimant may bring a claim against the contract funds in the hands of the contractor that have not yet been paid to a subcontractor, as is allowed in private works cases. The claimant may NOT, however, bring a claim against contract funds held by the public body. [44A-18; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C.App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

The bond provided by the developer or the contractor. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIPS: ONSLOW COUNTY:

The payment bond provided by the developer. [N.C.2013 Session Laws, 2013-37 (S.B.75), Sec. 1(f)]

All second- and third-tier subcontractors wishing to bring a lien claim, where the general contractor has filed a notice of contract. Also, all second- and third-tier subs wishing to be informed of when the first-tier sub is paid. If, however, the general timely gives all notices to the subs giving the Notice of Subcontract, then they will not be able to claim a lien. [44A-23, Schor at §34.03[C]] Note also that all contractors and first-tier subcontractors must, within 3 days of contracting with them, provide information pertaining to the lien agent to their subs and sub-subs who do not provide labor, materials, etc. to the jobsite. This is further discussed in the following paragraph.

For every project in excess of $30,000 (except for improvements made to existing owner-occupied residences), to protect one’s lien claim rights as against any potentially prejudicial action by the contractor, and as against a bona fide purchaser for value before the claimant files a lien, a claimant must give a Notice to Lien Agent to the lien agent named by the owner. If the claimant provides labor, materials, etc., to the improvement, the claimant should be able to obtain the information pertaining to the lien agent from either the posted building permit or a sign posted at the site. If the claimant does not provide labor, materials, etc. at the jobsite then it should be either included in claimant’s contract or purchase order or otherwise provided to the claimant by the party with whom he or she contracts within 3 business days of contracting with the supplier. If the claimant has not received the information in any of these ways, then in order to protect his or her claim against a purchaser, the claimant must send a written request for the information to the property owner. This notice must be sent via (1) certified mail, RRR; (2) signature confirmation via the USPS; (3) physical delivery with a delivery receipt; (4) fax with a fax confirmation; (5) depositing with a designated delivery service; or (6) email, with a delivery receipt. If the claimant does not provide the notice to the lien agent and has not filed a lien prior to the recording of the conveyance of an interest in the property to a bona fide purchase for value, the claimant’s lien will be subordinate to the rights of the purchaser, unless the owner failed to provide notice after claimant requested it. Note that where the project is the construction of a single-family residence, the contractor is not related to or affiliated with the owner, and the owner does not designate a lien agent, then the custom contractor (the general contractor’s designation in this situation) may designate the lien agent and notify the subs in the manner the owner otherwise would. [44A-11.1, 44A-11.2]

CONTRACTOR’S PROJECT STATEMENT:

General contractors and subcontractors

NOTICE OF PUBLIC SUBCONTRACT:

All claimants who have a contract with a subcontractor but no contract with the general contractor, and who have a claim exceeding $20,000. [44A-27]

PUBLIC-PRIVATE PARTNERSHIPS:

No one. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

No one. [N.C.2013 Session Laws, 2013-37 (S.B.75)]

The Notice of Subcontract is given to the general contractor. [44A-23]

The Notice to Lien Agent is given to the lien agent; it is not recorded. On every project in excess of $30,000, except for existing owner-occupied residences and their accessory buildings, the claimant must also give notice to the owner’s lien agent. Contact information for the lien agent shall be obtained either (a) from the contractor or subcontractor with whom the claimant is contracting, within 3 business days of entering the contract if the claimant is not required to provide labor, materials, rental equipment, or professional design or surveying services at the site; (b) by sending a written request notice to the owner (who must provide the information within 7 days of receiving the request); (c) from the building permit posted on the property; or (d) from the sign disclosing contact information posted on the property. Contractors and subs must give notice of the contact information for the lien agent to their subs and suppliers. (Note that a claimant who does not receive notice of the lien agent and does not provide labor, materials or professional services to the jobsite, or who completed its provision of labor, materials or professional services prior to the posting of the contact information, is not required to notify the lien agent until receiving notice of the agent’s contact information.) [44A-11.2]

CONTRACTOR’S PROJECT STATEMENT:

-By the contractor to each subcontractor that it engages to furnish labor or materials in performance of the construction contract.

-By subcontractors to each subcontractor that they engage to furnish labor or materials in performance of the construction contract. (Note that subs are giving their subs a copy of the contractor’s project statement; they are not providing their own project statement. [44A-27]

NOTICE OF PUBLIC SUBCONTRACT:

To the contractor or the agent identified in the contractor’s project statement. [44A-27]

For the Notice of Subcontract, no specific provision, but the sooner the better in order to receive notice of payments. The Notice to Lien Agent must be RECEIVED by the lien agent within 15 days after the first furnishing of labor or materials by the claimant, and prior to the date of recordation of a conveyance of the property interest in the real property to a bona fide purchase for value. Note that the lien agent must confirm receipt of the notice to the sender within 3 days of receiving it. [44A-11.2]

CONTRACTOR’S PROJECT STATEMENT:

No specific time, but the sooner the better. [44A-27]

NOTICE OF PUBLIC SUBCONTRACT:

As soon as possible, but in any event within 75 days after first furnishing labor or materials, as the notice only relates back 75 days prior to service of the notice. (Note, however, that if the claimant sends by certified mail to the contractor a written request for a copy of the payment bond, and the contractor fails to provide it within 7 calendar days of receiving the request, then the claimant’s claim is not limited to the 75 days prior to giving the notice of public subcontract.) [44A-27(b)]

See Form E. The signature line on the statutory notice form is identified as being for the contractor or subcontractor, thus it is recommended that the claimant sign it. The form need not be verified [44A-23]

See Form F for the Notice to Lien Agent form. Note that it must not be combined with or make reference to a Notice of Subcontract or Notice of Claim of Lien upon Funds. [44A-11.2]

CONTRACTOR’S PROJECT STATEMENT:

-The name of the project.

-The physical address of the project.

-The name of the contracting body.

-The name of the contractor.

-The name, phone number, and mailing address of an agent authorized by the contractor to accept service of the requests for payment bond, the notice of public subcontract, and the notice of claim on payment bond

-The name and address of the principal place of business of the surety issuing the payment bond for the construction contract. [44A-27]

NOTICE OF PUBLIC SUBCONTRACT:

Please contact Levy von Beck and Associates for form information.

No specific provision, but apparently by certified mail addressed to the recipient and signed for by them, or other any other method of service allowed by the NC Rules of Civil Procedure. Actual receipt of the notice is essential. [Schor vol. 3, §35.12]

The Notice to the Lien Agent is to be given via either: certified mail, return receipt requested; signature confirmation as provided by the United States Postal Service; physical delivery and obtaining a delivery receipt from the lien agent; facsimile with a facsimile confirmation; depositing with a designated delivery service; electronic mail, with delivery receipt; or utilizing a website approved for such use by the designated lien agent to transmit all the required information to the lien agent, with a delivery receipt to the claimant. Note that “delivery receipt” includes an electronic or facsimile confirmation. A return receipt or other receipt showing delivery of the notice to the addressee or written evidence that such notice was delivered by the postal service or other carrier to but not accepted by the addressee shall be prima facie evidence of receipt. [44A-11.2]

For a contractor or sub who needs to provide information about the lien agent to his or her subs or suppliers, the notice must be either included in the subcontract or purchase order, or sent within 3 days of entering the contract via certified mail RRR, a method involving signature confirmation by the USPS, fax with fax confirmation, deposited with a designated delivery service, or via email, with delivery receipt. Receipt showing delivery by the carrier but refusal to accept is evidence or receipt. [44A-11.2]

CONTRACTOR’S PROJECT STATEMENT and NOTICE OF PUBLIC SUBCONTRACT:

Certified mail or by signature confirmation as provided by the USPS, or served in the same manner as a summons. [44A-27]

An interim notice is not required.

An interim notice is not required.

REAL PROPERTY:

All parties entitled to lien the property. NOTE that where a subcontractor gives the notice of claim, the owner must retain sufficient funds to cover the lien. If the owner fails to do so, he or she will be personally liable to the subcontractor. If, after receiving the notice, the owner makes payments to the general contractor while retaining more than enough to cover the lien, but not enough to also cover the cost of completing the project, the owner remains personally liable to the subcontractor. NOTE ALSO that knowingly filing an unauthorized lien or filing a lien for an improper purpose (such as harassment) is a misdemeanor. [44A-12, 44A-23, 44A-12.1; O & M Industries v. Smith Engineering Co, 624 S.E.2d 345 (N.C. 2006)] NOTE that where the contractor contracts with a party that does not own the real property at the time the contractor begins furnishing labor or materials, they will not be entitled to a lien if that subsequent owner is the only party against whom they file a lien. [John Conner Const., Inc. v. Grandfather Holding Co., Inc., 732 S.E.2d 367 (N.C.App.,2012 ]

NOTE THAT in order to preserve one’s lien as against any potentially prejudicial action by the contractor, and as against a bona fide purchaser for value, the claimant must have either (a) given the Notice to Lien Agent within 15 days after first furnishing labor or materials; (b) given the Notice to lien agent prior to the date of recordation of a conveyance of the property interest to a bona fide purchaser for value; or (c) recorded a lien prior to the date of recording of such a conveyance. If the mortgage is recorded prior to the claimant filing a lien claim, the lien will be subordinate to the mortgage or deed of trust unless the lien agent (a) received the claimant’s notice within 15 days after the first furnishing of labor or materials; or (b) received the claimant’s notice prior to the date of recordation of the mortgage or deed of trust. [44A-11.2]

CONTRACT FUNDS:

All claimants except the general. [44A-18]

BOND CLAIM:

Claimant who has direct contract with subcontractor but none with the general contractor. [44A-27]

CONTRACT FUNDS HELD BY CONTRACTOR OR SUBCONTRACTOR, WHERE PROPER BOND IS NOT POSTED:

All claimants. [44A-18; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C.App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

Any claimant who has a direct contractual relationship with the general contractor or a subcontractor, but no contractual relationship with the developer. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

Any claimant who has performed labor or furnished materials pursuant to a contact with any contractor or sub, but has no relationship with the private developer. [N.C.2013 Session Laws, 2013-37 (S.B.75) Sec 1(f)]

REAL PROPERTY:

Clerk of superior court in each county where the property is located. A copy of the lien must also be given to the owner and to the general contractor. Note that a subcontractor (1^st, 2^nd or 3^rd tier) who is seeking to enforce the contractor’s claim must also serve and file a notice of claim of lien upon funds. [44A-12, 44A-11, 44A-19; Schor at §34.04[C]]

CONTRACT FUNDS:

The obligor, i.e., the owner, general, or sub of any tier who owes funds to the party with whom the claimant contracts, and to protect against any prejudicial action by the general contractor, a copy of the notice of claim of lien upon funds must also be given to the lien agent. Note that service of the notice on the lien agent is not a substitute for service of the notice upon the owner. If the obligor is a corporation, the notice must be addressed to the attention of an officer, director or managing agent of the corporation. Do not file it, except when it is attached to the lien on real property. Note that the notice of claim of lien on funds does not need to be attached to the lien. [Schor at §34.03[C], fn 62] If claimant is claiming subrogation, give notice to each party of a higher tier in the claimant’s contract chain. [44A-18, 44A-19, 44A-23]

BOND CLAIM:

Contractor. [44A-27]

CONTRACT FUNDS HELD BY CONTRACTOR OR SUBCONTRACTOR, WHERE PROPER BOND IS NOT POSTED:

Same as for private works, except that public body cannot be the obligor. [44A-18; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C.App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

To the private developer. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

To the private developer. [N.C.2013 Session Laws, 2013-37 (S.B.75) Sec 1(f)]

REAL PROPERTY:

Filed and served after the maturity of the obligation but within 120 days after claimant’s last delivery. [44A-12, 44A-11]

CONTRACT FUNDS:

Any time before final notice on real property lien is filed, but the sooner the better because, once received, it requires the obligor to withhold funds for the claimant’s benefit. Note that the lien upon funds attaches immediately upon first furnishing labor, materials or equipment, and is perfected upon giving notice, thus the claimant may still give notice even if a party above the subcontractor has filed for bankruptcy. [44A-19, 44A-20, 44A-18]

BOND CLAIM:

Received within 120 days after claimant’s last delivery. [44A-27]

CONTRACT FUNDS HELD BY CONTRACTOR OR SUBCONTRACTOR, WHERE PROPER BOND IS NOT POSTED:

Same as for private works, except that public body cannot be the obligor. [44A-18; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C.App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

More than 90 days but less than 120 days after claimant’s last providing labor or materials. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

More than 90 days but less than 120 days after claimant’s last providing labor or materials. [N.C.2013 Session Laws, 2013-37 (S.B.75) Sec 1(f)]

REAL PROPERTY:

Filed with clerk of court.

Service on the owner and contractor is complete upon either (1) personal delivery; or (2) mailing via USPS or sending via an authorized delivery service. Service is apparently complete upon ‘depositing.’ [44A-12, 44A-19, 44A-11]

CONTRACT FUNDS;

Personal service, delivery service, or certified mail addressed to the recipient and signed for by them. (In other words, any method of service allowed by the NC Rules of Civil Procedure.) Actual service appears to be essential, as proof of service is necessary. Additionally, sending another copy by first class mail is advised. A copy of the Claim of Lien Upon Funds must also be attached to the Claim of Lien on the Real Property. [44A-19]

BOND CLAIM:

Personal service, certified mail, or by signature confirmation as provided by the USPS, to the office of the contractor or the agent identified in the contractor’s project statement. The consequences of refusal of acceptance of the mail is not clear, thus recommend ensuring actual receipt.[44A-27]

CONTRACT FUNDS HELD BY CONTRACTOR OR SUBCONTRACTOR, WHERE PROPER BOND IS NOT POSTED:

Personal service, delivery service, or certified mail addressed to the recipient and signed for by them. Actual service appears to be essential, as proof of service is necessary. Additionally, sending another copy by first class mail is advised. [44A-18, 44A-19; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C. App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

Certified mail or signature confirmation as provided by the USPS, or in any manner provided by law for the service of summons. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

Certified mail or signature confirmation as provided by the USPS, or in any manner provided by law for the service of summons. [N.C.2013 Session Laws, 2013-37 (S.B.75) Sec 1(f)]

Real property: See Form A attached. If claimant filed a claim against contract funds, must attach a copy of that notice to lien claim when filed. NOTE: A CLAIM OF LIEN MAY NOT BE AMENDED — IT MAY ONLY BE CANCELED AND REPLACED WITHIN THE TIME LIMIT FOR FILING LIENS, SO IT IS VERY IMPORTANT TO HAVE CORRECT INFORMATION. The signature line on the statutory lien form is identified as being for the lien claimant, thus it is recommended that the claimant sign it. The form need not be verified. NOTE ALSO that a claim of lien which complies with the statutory requirements and is prepared by an attorney licensed in North Carolina cannot be rejected by the clerk of superior court for indexing, docketing, recording, or filing. [44A-12, 44A-19]

Contract funds: See Form B if supplying general, sub, or sub-sub; see Form C if supplying sub-sub-sub or more remote subs. [44A-19] NOTE, HOWEVER, that if owner, general, or anyone else claimant is serving is a corporation, notice must be sent to the attention of an officer, director or managing agent of the corporation. NOTE ALSO that if the subcontractor’ lien arises only through subrogation, then the sub is limited to the rights of the contractor, thus the sub’s lien cannot be greater than the amount owed to the general at the time the notice is given. [44A-20; Watson Electrical Const. Co. v. Summit Companies, LLC, 160 N.C.App. 647, 587 S.E.2d 87 (2003)]
[Schor at §34.03[C], fn 62]

BOND CLAIM:

-Notice of claim on payment bond.

– Amount claimed

– Name of person to whom labor or materials were furnished.

Neither the statute nor the case law specifies who must sign the notice. [44A-27]

CONTRACT FUNDS HELD BY CONTRACTOR OR SUBCONTRACTOR, WHERE PROPER BOND IS NOT POSTED:

Same as for private works. [44A-18; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C.App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

Written notice of the claim stating with substantial accuracy:

-Amount claimed.

-Name of the person for whom the work was performed or to whom the material was furnished. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

-Written notice of the claim.

-Amount claimed.

-Name of the person for whom the work was performed or to whom the material was furnished. [N.C.2013 Session Laws, 2013-37 (S.B.75) Sec 1(f)]

REAL PROPERTY:

Within 180 days after claimant’s last delivery. Where the property is located in more than one county, a lis pendens must be filed in every county except the one in which the action is commenced. If, within 180 days after the claimant’s last delivery, a lis pendens is filed in each county where the property is located, this will satisfy the 180-day deadline for commencing an action. It is generally recommended that a suit be filed in that time as well. If the lien enforcement action is brought in a county other than the county in which the lien was filed, a lis pendens must be filed in the county in which the lien was filed. [44A-13] NOTE that where a lender forecloses on a deed of trust which is superior to the claimant’s claim, the lien claimant still needs to timely commence its lien foreclosure in order to have the right to claim against any surplus funds remaining after the lender’s claim was satisfied. Lynch v. Price Homes, Inc. 156 N.C.App. 83, 575 S.E.2d 543 (N.C.App., 2003)

NOTE that only the owner is a necessary party to a suit, though other claimants are proper parties, and if they are not named and included, then the foreclosure will not affect the other claimants’ rights. [Lawyers Title Ins. Corp. v. Zogreo, LLC, 702S.E.2d 222 ( N.C.App.,2010)] NOTE ALSO that if the real property is under the control of the bankruptcy court, then filing a proof of claim plus a lis pendens will satisfy the requirement of commencing the lien enforcement action. [44A-13]

CONTRACT FUNDS:

No specific provision.

PUBLIC-PRIVATE PARTNERSHIP:

NOTE that where a lien is claimed on the property or the contract funds on a public-private partnership project, the lien may be discharged by posting an adequate payment bond. The claimant will then have at least 1 year from the date of service of the payment bond and affidavit to file suit on the payment bond. [44A-16]

BOND CLAIM:

More than 90 days, but less than one year after last delivery by contractor or sub, or final settlement with contractor, whichever is later. [44A-27, 44A-28, Schor at §34.02[D]]

CONTRACT FUNDS HELD BY CONTRACTOR OR SUBCONTRACTOR, WHERE PROPER BOND IS NOT POSTED:

Same as for private work. [44A-18; James River Equipment, Inc. v. Tharpe’s Excavating, 634 S.E.2d 548 (N.C.App., 2006)]

PUBLIC-PRIVATE PARTNERSHIPS:

More than 90 days, but less than one year after last delivery or work by claimant. [143-128.1C]

PUBLIC-PRIVATE PARTNERSHIP, ONSLOW COUNTY:

More than 90 days, but less than one year after last delivery or work by claimant. [N.C.2013 Session Laws, 2013-37 (S.B.75) Sec 1(f)]

FORM A

NOTE THAT, for the dates of first and last furnishing of property, a first-tier subcontractor can use either the first and last dates that the subcontractor provided labor or materials, or the first and last dates that the contractor through which the sub is making his or her claim last furnished labor or materials.

CLAIM OF LIEN ON REAL PROPERTY

 

(1) Name and address of the person claiming the claim of lien on real property:

(2) Name and address of the record owner of the real property claimed to be subject to the claim of lien on real property at the time the claim of lien on real property is filed and, if the claim of lien on real property is being asserted pursuant to G.S. 44A-23, the name of the contractor through which subrogation is being asserted:

(3) Description of the real property upon which the claim of lien on real property is claimed: (Street address, tax lot and block number, reference to recorded instrument, or any other description of real property is sufficient, whether or not it is specific, if it reasonably identifies what is described.)

(4) Name and address of the person with whom the claimant contracted for the furnishing of labor or materials:

(5) Date upon which labor or materials were first furnished upon said property by the claimant:

(5a) Date upon which labor or materials were last furnished upon said property by the claimant:

(6) General description of the labor performed or materials furnished and the amount claimed therefor:

I hereby certify that I have served the parties listed in (2) above in accordance with the requirements of G.S. 44A-11.

……………………..

Lien Claimant

Filed this ….. day of ……….., ………………………

…………………………………………

Clerk of Superior Court

                                                                                   FORM B

NOTICE OF CLAIM OF LIEN UPON FUNDS BY FIRST, SECOND, OR THIRD TIER SUBCONTRACTOR

To:

1. ……………………………………., owner of property involved.

(Name and address)

2. ……………………………………………, contractor.

(Name and address)

3. …………………….. , first tier subcontractor against or through whom subrogation is claimed, if any.

(Name and address)

4. …………………….. , second tier subcontractor against or through whom subrogation is claimed, if any.

(Name and address)

General description of real property on which labor performed or material furnished:

…………………………………………………………………

…………………………………………………………………

…………………………………………………………………

General description of undersigned lien claimant’s contract including the names of the parties thereto: ……………………………………………….

…………………………………………………………………

…………………………………………………………………

The amount of lien upon funds claimed pursuant to the above described contract:  $ …………………….

The undersigned lien claimant gives this notice of claim of lien upon funds pursuant to North Carolina law and claims all rights of subrogation to which he is entitled under Part 2 of Article 2 of Chapter 44A of the General Statutes of North Carolina.

Dated ……………

………………., Lien Claimant

……………………………. (Address)

                                                                                   FORM C

NOTICE OF CLAIM OF LIEN UPON FUNDS BY SUBCONTRACTOR MORE REMOTE THAN THE THIRD TIER

To:

………………………….. , person holding funds against which lien upon funds is claimed.

(Name and Address)

General description of real property on which labor performed or material furnished:

…………………………………………………………………

…………………………………………………………………

…………………………………………………………………

General description of undersigned lien claimant’s contract including the names of the parties thereto: ……………………………………………….

…………………………………………………………………

…………………………………………………………………

The amount of lien upon funds claimed pursuant to the above described contract:    $ …………………………………………………….

The undersigned lien claimant gives this notice of claim of lien upon funds pursuant to North Carolina law and claims all rights to which he or she is entitled under Part 2 of Article 2 of Chapter 44A of the General Statutes of North Carolina.

Dated: ……………

………………., Lien Claimant

……………………………. (Address)

                                                                                   FORM D

NOTICE OF CONTRACT

(1) Name and address of the Contractor:

(2) Name and address of the owner of the real property at the time this Notice of Contract is recorded:

(3) General description of the real property to be improved (street address, tax map lot and block number, reference to recorded instrument, or any other description that reasonably identifies the real property):

(4) Name and address of the person, firm or corporation filing this Notice of Contract:

Dated: _________________________

_________________________________________

(Contractor or Owner)

 

Filed this the _______ day of ____________, _____.

_________________________

Clerk of Superior Court

                                                                                   FORM E

NOTICE OF SUBCONTRACT

(1) Name and address of the subcontractor:

(2) General description of the real property on which the labor was performed or the material was furnished (street address, tax map lot and block number, reference to recorded instrument, or any description that reasonably identifies the real property):

(3)(i) General description of the subcontractor’s contract, including the names of the parties thereto:

(ii) General description of the labor and material performed and furnished thereunder:

(4) Request is hereby made by the undersigned subcontractor that he be notified in writing by the contractor of, and within five days following, each subsequent payment by the contractor to the first tier subcontractor for labor performed or material furnished at the improved real property within the above descriptions of such in paragraph (2) and subparagraph (3)(ii), respectively, the date payment was made and the period for which payment is made.

Dated: _______________

_________________________________________

Subcontractor

FORM F

NOTICE TO LIEN AGENT

(1) Potential lien claimant’s name, mailing address, telephone number, fax number (if available), and electronic mailing address (if available):  _________________________________

 

(2) Name of the party with whom the potential lien claimant has contracted to improve the real property described below: ………………………

 

(3) A description of the real property sufficient to identify the real property, such as the name of the project, if applicable, the physical address as shown on the building permit or notice received from the owner: …………………

(4) I give notice of my right subsequently to pursue a claim of lien for improvements to the real property described in this notice.

 

Dated: ……….

……………………..

Potential Lien Claimant

FORM G

NOTICE OF PUBLIC SUBCONTRACT

(1) Name and address of the subcontractor giving notice of public subcontract:

(2) General description of the real property on which the labor was or is to be performed or the material was or is to be furnished (street address, tax map lot and block number, reference to recorded instrument, or any description that reasonably identifies the real property):

(3) General description of the subcontractor’s contract, including the names and addresses of the parties thereto:

(4) General description of the labor and material performed and furnished thereunder:

Dated: ……………

………………………………Subcontractor