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How many days to notify lien agent?

North CarolinaPreliminary Notice

Hi, We have received a notification from our client in regards to the appointment of a lien agent on 11.09.18 however we have already started working on the project prior to that. Also, not being located in the State of NC, we were not aware what the notice was for and what we had to do with it. How many days do we have after the receipt of the notice to get in contact with the agent and register, especially as we have received it after starting work? Thank you!

1 reply

Dec 17, 2018
Great question! North Carolina is one of very few states that embrace a lien agent - and discusses that role a little more here: What Is a Lien Agent? Generally, notice must be given to a North Carolina lien agent within 15 days from first furnishing labor and/or materials. Of course, where a lien agent has not been designated during that time, it's impossible to provide a lien agent with that notice - but it's likely a good idea to send notice immediately upon the designation of a lien agent. While an owner is required to identify their lien agent, the North Carolina lien statute is unclear as to what consequences an owner will face for failure to identify their mechanics lien agent. Further, based on § 44-A11.2(b) of the North Carolina lien statute, a lien claimant who has provided work prior to the posting of the contact info for the lien agent "A potential lien claimant making a request pursuant to this subsection who has not furnished labor at the site of the improvements, or who did so prior to the posting of the contact information for the lien agent pursuant to subsection (d) or (e) of this section, shall have no obligation to give notice to the lien agent under this section until the potential lien claimant has received the contact information from the owner." Note, though, that section is qualified by the phrase "A potential lien claimant making a request pursuant to this subsection..." - so, as written, it appears to only apply to those on the project who requested the information of the lien agent but did not receive it. As for a situation where a lien agent was first designated late in the project - the statute is unclear as to how that might affect the need to provide a Notice to Lien Agent. Ultimately, this issue would likely come down to the following ideas: Where Notice to Lien Agent was not sent within the timeframe set out be statute, the right to lien might be lost. However, where a claimant had no way of knowing a lien agent was present, or when a lien agent was designated during the life of the project, potentially, there could be some leniency granted if the issue went before a court. Of course, most lien disputes don't make it to the courtroom, and they're typically resolved without the need for legal action. For more clarity here, it might be helpful to reach out to a local construction law attorney who's familiar with the rules surrounding lien agents and the notice rules involving them. They will be able to thoroughly asses your situation and provide advice on how to proceed.
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