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What does the law state in regards to a mechanics lien deadlines

We filed a notice of intent to lien on a property that we were hired by a Public Adjuster on for asbestos testing. The PA was supposed to pay the invoice and we have no received the payment. Upon filing the NOI we received an phone call from the building owner stating that we should know that we are outside the deadline for the lien to be filed. My question is, I was of the understanding that if we were to lien the funds there is no deadline. Any advice or direction here would be greatly appreciated.

1 reply

Jan 8, 2020

North Carolina's deadline for filing a lien against the project property (a "mechanics lien") is 120 days from last furnishing labor or materials to the job. But, as you mention above, there isn't really a deadline for filing a lien on the project funds which operates quite differently. A lien on funds freezes project funds at some point in the payment chain - specifically, when properly made, a lien on funds would stop a customer from being paid in full by their customer. For example: If a first-tier subcontractor (hired by the general contractor) places a lien on funds, then that would stop funds from flowing between the owner to the general contractor. However, if that contractor had been fully paid on the job, then there wouldn't be any funds to lien. Levelset discusses that here: NC Lien on Funds not Lien on Property. So, if a threat to lien the project property has been given, and if the deadline to file a lien on the property has passed, then it would make sense that a recipient might claim the time to file a mechanics lien has passed. But, for a subcontractor, sub-sub, supplier, etc. who's looking to lien the project funds at some point in the payment chain, then there isn't a hard deadline to adhere too - and as long as all project funds haven't been paid out to other parties, a lien on funds may well be appropriate.

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