I am the prime contractor on four commercial projects in North Carolina where I recently missed my deadline to enforce my mechanics lien. What are my options for legal recourse and collecting payment on these projects?
Mar 29, 2019
I'm sorry to hear about your situation. However, there are always options outside of the mechanics lien enforcement process to try and compel payment. For one, sending a warning or threat that a filed mechanics lien will be enforced could always do the trick - regardless of whether a claimant actually intends to do so. By sending a document like a Notice of Intent to Foreclose, a lien claimant can turn the heat up on a property owner. Considering the drastic implications of a potential lien enforcement suit, it's entirely possible that a property owner would be willing to talk payment to avoid the uncertainty of litigation. Another option might be to send demand letters to nonpaying parties. When payment demands are sent along with specific legal threats (like a breach of contract claim, an unjust enrichment claim, or some other legal claim), a claimant can show their customer they're serious about getting paid. Demand letters are especially effective when sent via an attorney. If threats and demands don't work, it might come time to take more official action. One option, though not necessarily a favorable one, might be to send the debt to collections. By putting a debt in collections, a contractor won't be able to recover everything they're owed - but at least they'll be done with the matter. Plus, the added benefit of "getting back" at the customer by hurting their credit might be desired by some contractors. Another option, depending on the amount of the claim, might be to take a customer to North Carolina small claims court. However, it appears that North Carolina small claims court actions are limited to $10,000 or less. Finally, regardless of whether the amount of the dispute exceeds $10,000, taking legal action (i.e. filing a lawsuit) is always an option. With all of that being said, keep in mind that every construction dispute is different - and that means the best route for recovery will be different depending on the situation, too. Before taking action, it might be wise to consult with a local construction attorney to review the details of your situation and to advise on how to proceed. They'll be able to highlight the pros and cons of different recovery methods and advise on how best to proceed.
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