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File To Owner In NC in Advance of shipping?

I'm getting ready to begin shipping brick to the largest project I've sold to and concerned the subcontractor mason who I'll be selling these to is going to be a problem for a myriad of reasons. It was suggested to me I file to owner in advance to protect myself if the mason doesn't pay in terms or holds back payment. If this protects me, please advise how and what steps I should take to file. We're a few weeks from shipping first load and I want to protect myself as much as possible.

1 reply

Jun 19, 2019

That's a great question, and I'm glad you're proactively thinking about potential problems. All too often, construction and supply businesses wait until something goes wrong to create a gameplan for dealing with issues. I'll assume you're referring to sending preliminary notice in order to notify others that you're providing work to the project and to preserve the eventual right to file a mechanics lien, if payment disputes become a problem.

In North Carolina, all privately owned construction projects where the overall project cost exceeds $30,000, as well as for projects on all owner-occupied single-family residences, a property owner must designate a "lien agent" (generally, a title insurance company) for their construction project. Where a lien agent is present, subs and suppliers who weren't hired directly by the property owner must typically send preliminary notice (called a "Notice to Lien Agent") in order to preserve their right to lien.

Further, sending a Notice of Subcontract can help to preserve rights, too. This document is only required when the project's general contractor has filed a Notice of Contract - but as mentioned above, sending preliminary notice (even when it's not required) is good to build communication and collaboration on the project. Plus, where a Notice of Contract is filed, sending a Notice of Subcontract is necessary to best preserve payment recovery rights.

For more information on sending notices in North Carolina, these resources should be helpful:
(1) About North Carolina Preliminary Notices
(2) North Carolina Preliminary Notice: Everything You Need to Know
(3) North Carolina Lien and Notice Overview, FAQs, and Statutes.

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