Sending a preliminary notice is essential for securing your mechanic’s lien rights. Every state has their own set of laws dealing with when and where these notices must be sent, but North Carolina is one of the only states to have a unique lien notice recipient: the lien agent.
A “lien agent” is one of several terms that contractors in North Carolina must know about. Below, we discuss North Carolina’s lien agent laws and what they mean for contractors working in the Tar Heel State. For any questions regarding North Carolina’s mechanic’s lien process, contact a Charlotte mechanic’s lien attorney from Cotney Construction Law.
North Carolina Lien Agents
In North Carolina, a lien agent is a title insurance company or agency that must be notified prior to filing a mechanic’s lien. General Statute 44A-11.1 requires a lien agent to be appointed by an owner on projects that are valued at $30,000 or more. If you are unsure of who the lien agent is on your project, you can either request this information from the owner or review the building permit.
With contractors, subcontractors, and material suppliers coming and going on a project site, it’s not uncommon for an owner to be unaware of all of the entities contributing to a project. By requiring that a preliminary notice be sent to a lien agent, this system ensures that owners are never surprised by a mechanic’s lien.
What Do Contractors Need to Know?
General contractors, subcontractors, laborers, suppliers, and all other entities must send a Notice to Lien Agent within 15 days of first providing labor or materials. While sending a Notice to Lien Agent in a timely manner is essential for preserving your lien rights, it is only one of several lien deadlines to be aware of. For complete details on how to successfully file a mechanic’s lien in North Carolina, contact a Charlotte construction lien attorney from Cotney Construction Law.
Everyone stands to benefit from the requirement of a lien agent. As mentioned, lien agents keep owners in the loop on who is working on their projects. Subcontractors and material suppliers who are further down the construction totem pole now have a clear understanding of whom to send a preliminary notice to. However, the real winners are the insurance companies that profit from this system.
While contractors can benefit from the inclusion of a lien agent, it’s not all for the best. While it can be extended, a Notice to Lien Agent will expire after five years. Furthermore, you may be required to cancel this notice upon receiving final payment. As a contractor, you must remain aware of particulars like these to ensure that you always receive payment for your services. For a partner that can assist you with securing your mechanic’s lien rights, contact a Charlotte mechanic’s lien attorney from Cotney Construction Law.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.