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General contractors must send a preliminary notice on private projects.
The preliminary notice to lien agent must be provided to the lien agent. A notice of contract must be filed with the clerk of court for the county in which the project occurred. And, a notice of subcontract must be provided to the GC.
General contractors must provide an informational notice on public projects.
While GCs don't have the ability to make a claim against the payment bond they obtained for the protection of sub-tier parties, they still have notice requirements in North Carolina.
Subcontractors and suppliers must send notice on private projects.
The party that receives the notice depends on the notice itself. The preliminary notice to lien agent must be provided to the lien agent. A notice of contract must be filed with the clerk of court for the county in which the project occurred. And, a notice of subcontract must be provided to the GC.
Subcontractors and suppliers may need to send notice on public projects.
If the claim is worth more than $20,000, notice of public subcontract must be sent.
Yes, in most cases some notice will be required.
North Carolina requires a preliminary notice to be sent to a “lien agent” if one is present. However, a lien agent will not be required on:
1. Projects where the original building permit was less than $30,000; or
2. An owner-occupied, single-family residence.
When required, a Notice to Lien Agent must be made within 15 days from the potential lien claimant’s first furnishing of labor and/or materials to the project. We discuss this requirement here: Lien Agent: The Most Dramatic Change to North Carolina’s Mechanics Lien Laws.
North Carolina also provides a mechanism for a general contractor to protect himself from double payment liability through subrogation liens filed by second or third-tier subcontractors – called a Notice of Contract. If the GC files this Notice of Contract, then subcontractors and suppliers must file a Notice of Subcontract.
The Notice to Lien Agent must be sent within 15 days of the potential lien claimant’s first furnishing of labor and/or materials to the project.
If utilized, a Notice of Contract must be filed by the general contractor within 30 days after the building permit is issued for the project. The notice should be filed with the Clerk of Court in the county in which the property is located, and posted in a visible location at the project site adjacent to the posted building permit.
A Notice of Subcontract must be served on the general contractor to identify the lower tier subcontractor. There is no specific time requirement to serve the general with the notice of subcontract; it may be served prior to the furnishing of labor or materials or at anytime thereafter. However, the general contractor is only required to notify the sub of payments made after the receipt of the notice of subcontract. Therefore, the sooner it is filed, the better.
There has been no litigation yet related to the new notice provision as it went into effect on April 1, 2013. However, the express language of the requirement makes the failure to timely send the preliminary notice fatal to a lien claim. At the very least, it appears that the priority of the lien will be adversely affected if the requirement is considered valid.
If the general contractor fails to file and post the Notice of Contract in the required time period, he is not protected against potential double payment through subrogation liens filed by second or third tier subs or suppliers.
There is no set time requirement for serving the general contractor with the notice of subcontract. So in a strict sense, it cannot be late. However, a sub is only entitled to receive notice of payments made after the notice was given.
The preliminary notice to lien agent is generally filed electronically through LiensNC.com, a state notice repository created by statute. We explain how this service works and give it a review in these two articles:
Other allowable methods for delivery of a preliminary notice to lien agent are:
North Carolina law provides several methods of delivery of the notice to lien agent authorized by statute, including:
(1) Certified mail, return receipt requested.
(2) Signature confirmation as provided by the United States Postal Service.
(3) Physical delivery and obtaining a delivery receipt from the lien agent.
(4) Facsimile with a facsimile confirmation.
(5) Depositing with a designated delivery service authorized pursuant to 26 U.S.C. § 7502(f)(2).
(6) Electronic mail, with delivery receipt.
The Notice of Contract must be filed with the Clerk of Court in the county in which the property is located, and posted in a visible location at the project site adjacent to the posted building permit.
The Notice of Subcontract must be provided to the general contractor – but no specific provision sets forth the manner in which he must be served. Best practice may be to send the notice by certified mail.
The Preliminary Notice to Lien Agent must be sent to the Lien Agent appointed in the building permit. If the building permit does not list the Lien Agent, any party may request that information and must receive a reply from the property owner within 7 days. Further, the general or any subcontractor is required to provide any supplier with whom they contract the name of the Lien Agent within 3 days of contracting with that supplier.
The Notice of Contract must be filed with the Clerk of Court of the county in which the property is located, and posted at the project site; the notice of subcontract must be provided to the general contractor.
It is unclear whether the Preliminary Notice to Lien Agent is considered delivered upon sending or receipt. However, the requirement that the notice be served via a method providing notice of actual receipt seems to indicate that the actual receipt of the notice is required.
Notice is considered filed when filed, and posted on the jobsite. It is not specified whether notice of subcontract is considered delivered when sent or received as there are no specific requirements as to how to send it.
It depends. Subcontractors whose claim is greater than $20,000 must provide a “Notice of Public Subcontract” within 75 days of first furnishing labor and/or materials to the project. This notice is not require for claims less than $20,000, and is only required for the amount exceeding $20,000 when the claim is greater than $20,000.
Further, General Contractors must provide every subcontractor it engages to perform labor or furnish materials a “Contractor’s Project Statement” that includes the following information:
Subcontractor’s should provide the “Notice of Public Subcontract” within 75 days of first furnishing labor and/or material to the project. However, if the General Contractor failed to provide a copy of the bond within 7 calendar days of a proper written request, the 75 day deadline is waived.
The statutory sections concerning the General Contractor’s “Contractor’s Project Statement” contain no specific date by which it must be provided to the subcontractors.
The “Notice of Public Subcontract” may be given later than 75 days, but it will only be partially effective to preserve the right to make a bond claim. Late notice will only preserve the right to make a claim for labor and/or materials furnished in the 75 days immediately prior to sending the notice. Work provided more than 75 days prior to sending notice will not be protected.
Notice, when required, should be sent via certified mail, or by signature confirmation as provided by the United States Postal Service, postage prepaid, or served in any manner provided by law for the service of summons.
The “Contractor’s Project Statement” should be “provided” to the subcontractors.
Notice of Public Subcontract must be provided to the General Contractor.
The Contractor’s Project Statement should be provided to the subcontractors.
First, filing a lien under the circumstances you present is problematic. There are strict deadlines for noticing intent and recording your lien. Sounds to me like this is an afterthought and not within 4 months of your last date of work, but perhaps I'm wrong there. In any event, if you're seeking items from two years ago, I doubt that would go well for you under a mechanic's lien theory of recovery.
Second, it doesn't sound like there was much of an arrangement between you and the owner, this was something you were doing to improve the residence you were living in.
Third, if you're broke, what good is the mechanic's lien anyway? Even if it were valid, you'd still need to take action on it to pursue it. If they've just refi'd, I imagine the property is encumbered to a not-insignificant extent. The loan already closed, so presumably they aren't going to refi again or sell very soon. If you don't have the money to pursue a wrongful eviction, foreclosure likely isn't within your current financial ability to pursue. If you aren't going to foreclose, then you still have other claims and remedies, but I'd think you'd handle most of those claims and damages within a wrongful eviction case, should you ever have the means to pursue that case.
Most likely your best course of action at this point would be a demand letter and potentially a breach of contract action against the GC who has not paid you. If there is a payment bond on the project your may still have time to make a claim against this bond. But otherwise, because you did not send preliminary notice, you would not have lien rights.
North Carolina has an interesting preliminary notice scheme, but it can be confusing. North Carolina amended it’s notice and lien laws in 2013, so those changes shouldn’t be a surprise to anybody by now – but there are still nuances to consider that can make compliance with the rules and requirements related to preliminary notice in North Carolina tricky. There are different notices that may be required in different situations, but the overarching notice requirement is the “Notice to Lien Agent.”
North Carolina created the lien agent concept in their notice requirements pursuant to legislation in 2013. The lien agent in North Carolina, and the required notice to that lien agent, was designed to confront the problem of “hidden liens.” In order for project participants in North Carolina to retain the right to file a valid and enforceable mechanics lien on most projects, they must first give preliminary notice to a designated lien agent. In North Carolina, the lien agent is required to be, “a title insurance company or title insurance agency designated by an owner pursuant to G.S. 44A-11.1.”
For any private project in North Carolina in which the original building permit is $30,000 or more, the owner is required to designate a lien agent (“title insurance company”) — and the potential lien claimant must serve this lien agent with a preliminary notice in order to protect his rights. The lien agent must be noted on the building permit for projects for which a building permit is required, which should be posted at the job site. If it is not, a potential lien claimant may request the identity of the lien agent by sending a written request to the property owner, who has 7 days in which to respond. Further, a contractor or subcontractor must provide a material supplier with a notice identifying the Lien Agent within 3 days of contracting with that supplier.
Generally, these preliminary notices to lien agent are provided through the North Carolina online lien agent system liensnc. However, despite the official sounding name, and the general ease of electronic noticing (when everything is listed correctly) it’s not strictly necessary to provide the notice through that portal.
North Carolina law provides several methods of delivery of the notice to lien agent authorized by statute, including:
(1) Certified mail, return receipt requested.
(2) Signature confirmation as provided by the United States Postal Service.
(3) Physical delivery and obtaining a delivery receipt from the lien agent.
(4) Facsimile with a facsimile confirmation.
(5) Depositing with a designated delivery service authorized pursuant to 26 U.S.C. § 7502(f)(2).
(6) Electronic mail, with delivery receipt.
Number 6 on the list is especially intriguing. While there has not yet been litigation surrounding the sufficiency of a notice delivered via e-mail, it will be interesting to see how that plays out. Additionally, while supposedly required, the notice to lien agent (and its deadline) appears to not technically matter related to the ability to file a lien, provided the notice is given or the lien filed prior to the conveyance of the underlying property to a bona fide purchaser for value.
North Carolina also provides a mechanism for a general contractor to protect himself from double payment liability through subrogation liens filed by second or third tier subcontractors, if subcontractors don’t provide an additional notice timely. If the notice of contract is filed by the general contractor, the subcontractors and suppliers must file a notice of subcontract.
The first step is to read the guide to preliminary notices in North Carolina. This article explains everything you need to know about preliminary notices, including the information that’s required, the rules for delivery, and the deadlines to send.
In North Carolina, the notice you send depends on your role in the project. If there’s a lien agent on the project, every participant must send notice to the lien agent. GCs can file a notice of contract to protect them from double payment liability. If the GC files a notice of contract, all subcontractors are required to file a notice of subcontract. You can find the generic preliminary notice form here.
Our free forms were created by construction attorneys to meet all language and formatting requirements in North Carolina, making this part easy to get right.
It’s important that you fill the preliminary notice form out carefully. That’s because making a mistake could cost you your right to file a mechanics lien in North Carolina down the line. Include all the required information, and make sure the information is 100% correct.
The last step is to deliver your North Carolina preliminary notice. Deliver your notices by certified mail, return receipt requested, or utilize LiensNC.
North Carolina notices of contract must be filed with your local county clerk. View a full list of North Carolina counties here to find your clerk. There are no specific delivery requirements for notices of subcontract.
Select Preliminary Notice document.
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