Construction Law

"Lien In": North Carolina General Assembly Revisits New Mechanics Lien Laws

Last April, we wrote about the significant changes to the North Carolina mechanics lien laws, which are continuing to create issues and opportunities for owners, contractors, subcontractors and title companies working in the State.  As with any significant legislative revision — to shamelessly employ a metaphor or two especially pertinent in the construction space — the “dust has settled” to a degree and some “touching up” must now take place.  The North Carolina General Assembly is back in session, in Raleigh, tackling a number of issues.

Are the mechanics lien laws one such issue?  Yes.

Ok, but what’s going on in that mechanics lien law space?  Well, our fine Raleigh colleague, Laura DeVivo, updated the world on her must-read, up-to-the-minute blog “Keeping Up With Jones Street” about the sometimes relevant but always impactful “goings on” at the North Carolina General Assembly.  To those outside the State, “Jones Street” is a reference to the location in Raleigh of the State’s legislative office building.

Laura’s blog entry can be accessed here in its website form, and it states:
HB 1101 – An Act to Enhance the Protection provided to Persons Making Improvements to Leased Real Property Under Article 3 of Chapter 44A of the General Statutes, as Recommended by the LRC (Legislative Research Commission) Committee on Mechanics Liens and Leasehold Improvements.  This bill would amend the statute concerning bond requirements for people making improvements to leased property; requires that anyone who leases property must secure bonds for changes to public buildings, and which parties must secure bonds; and provides that public-private partnerships subject to GS 143-128.1C are not subject to this bill. You can read the bill here:
HB 1102 – An Act to Clarify the Information Required to be Provided in a Notice to Lien Agent, as Recommended by the LRC Committee on Mechanics Liens and Leasehold Improvements.  This bill would amend the statute concerning the identification of life agent, notice to lien agent, and effect of notice to provide that service of the Notice to Lien Agent does not satisfy the service or filing requirements that apply to a Notice of Subcontract. Further, a Notice to Lien Agent cannot be combined with or refer to a Notice of Subcontract or a Notice of Claim of Lien upon funds. You can read the bill here:
The LRC on Mechanics Liens and Leasehold Improvements is made of House and Senate Members and held public meetings since adjournment last summer.
 We and Laura will keep an eye on this legislation as it moves through the system.

“As Sheryl Sandberg says, ‘You’ve got to lien in’.  Wait, that’s not right.”
**UPDATE – May 23, 2014***

Laura updates us here, on her blog “Keeping Up With Jones Street“.  She says:
HB 1101 and HB 1102 dealing with Mechanics Liens which we wrote about earlier this week will be considered Wednesday 5/28 at 10:00 in the Subcommittee C of the House Judiciary Committee. The bill sponsor is Representative Sarah Stevens who also chairs this subcommittee. There is no public audio connection for this committee room so I will report on committee actions.

***UPDATE – June 6, 2014***

Laura updates us again on her blog “Keeping Up With Jones Street“.  She says:

Mechanics Liens, HB 1101 and HB 1102 passed the House and are parked in the Senate Rules Committee. (Use of the Rules Committee is a very powerful tool. It’s a place to kill a bill, park a bill, rewrite a bill, horse trade…the possibilities are endless. Mischief abounds). We’re not sure what’s next for these bills but will keep you posted.

Mike Thelen practices in Womble, Carlyle’s Real Estate Litigation and Land Use practice group. He regularly represents a wide variety of clients, from local governments to businesses, in land use and land development matters in both state and federal venues throughout North Carolina.

Follow the North Carolina Land Use Litigator on Twitter at @nclanduselaw and “like” us on Facebook here.

Categories: Construction Law

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