Perspectives

Amendments to North Carolina Mechanic’s Lien and Payment Bond Laws

In 2012, the North Carolina legislature significantly altered the laws for private mechanic’s lien and public payment bond claims.  Some of the changes went into effect on January 1, 2013, while others have an effective date of April 1, 2013. Below is a brief summary of some of the significant changes:

Effective January 1, 2013:

– A new preliminary notice form, called a Notice of Public Subcontract, is required for certain claimants on a public project. The Notice must be served within 75 days after the claimant’s first furnishing of labor or material.

– On a public project, if a payment bond is required, the general contractor must now provide a Contractor’s Project Statement, which lists certain identifying information about the project, including the name and address of the surety.

– Upon written request from a claimant, a general contractor must provide a copy of the payment bond furnished for a public project.

Effective April 1, 2013:

– The owner on a private project must designate a “lien agent,” which will usually be a title company. Claimants on a private project will have to serve lien notices on the designated “lien agent.”

– There is a new preliminary notice requirement for private projects. If a lien claimant has a contract with a party other than the owner, the claimant must serve a Notice to Lien Agent within 15 days after the claimant’s first furnishing of labor or material.

If you have any questions regarding the recent changes to North Carolina’s lien and bond laws, please contact Mark Anderson (manderson@wfjlawfirm.com) or Dan Reich (dreich@wfjlawfirm.com).