North Carolina Legislative News

  • Effective 1/1/08 - S1245 - Retainage Reform
  • Effective 1/1/2002 - SB 912 Amendment to Mechanic's Lien Law - The North Carolina Legislature is at it again amending our mechanics' lien law.  North Carolina General Statute 44A-12.1, "an Act to Prohibit the Indexing, Docketing, or Recording of Unauthorized Claims of Lien and to Provide for Penalties for Filing Unauthorized Statutory Liens," became effective January 1, 2002 and will apply to offenses committed on or after that date.  Basically, this statute directs the Clerk of Superior Court not to index, docket, or record a claim of lien purporting to assert a lien on real property unless the document "appears on its face to contain all of the information required by the stature. . . " The Clerk may, however, accept a defective document "for filing," but must inform the person offering the document that it will not be indexed, docketed, or recorded in any way which will affect the title to any real property.

Additionally, the statute also makes it a Class 1 misdemeanor to cause or attempt to cause a claim of lien to be filed "knowing that the filing is not authorized by statue, or with the intent that the filing is made for an improper purpose. . . "  This is a positive development in that too many liens are filed for improper purposes.  Although intent is always difficult to prove, this statue gives those against whom a lien is filed some solid statutory authority for complaining.

In essence, the Legislature has made the Clerk of Superior Court of each county the "gatekeeper" with regard to defective liens.  One might argue that the legislation is good in that it will keep defective liens from being filed.  Of course, the down side is that valid liens that do not "look" like they are supposed to will be denied by the Clerk.  In larger, busier counties, the Clerks will probably continue to take liens that have all the bells and whistles, while in smaller counties the Clerks may scrutinize liens more carefully.

Unfortunately, because there are 100 counties in North Carolina, each with its own Clerk of Superior Court (and each usually with several assistant clerks as well), there will be no uniform application of the new statute.  More than likely, however, most Clerks will spend less time scrutinizing a lien that has been prepared by a lawyer.  If you chose to prepare a lien yourself, make sure and utilize the  statutory form provided in 44A-12.  If you have concerns about preparing a valid lien, you should consider consulting with a construction lawyer, especially if there is a significant amount of money at stake.  A lien is a powerful tool, but it can be easily lost or invalidated if it does not strictly comply with all of the statutory requirements.   Copies of this new law are available by calling the ASAC office at 877-285-3356

Contributed by:  The Construction and Surety Group, Adams Kleemeier Hagan Hannah & Fouts PLLC, Greensboro NC, 336-373-1600.

  • Effective 12/6/01 - New Public Contracting Law alters North Carolina's Public Multi-Prime Contractor bidding requirements.  This bill makes several significant alterations to public bidding.

      Construction Management at Risk services are selected on the basis of demonstrated competence and qualification without regard to fee.  After a Construction Manager at Risk is selected, the parties will then negotiate a fee.  If the best qualified firm and the Owner cannot negotiate a fee, the Owner will then initiate contract fee negotiations with the next best qualified contractor.

       The Construction Manager at Risk shall contract directly with the Owner and shall publicly advertise as required by N.C. Gen. Stat. 143-129.  The Owner and Construction Manager will work together to pre-qualify first-tier subcontractors before the Construction Manager at Risk accepts bids.

       Construction Manager at Risk and first-tier subcontractors shall make a good faith effort to recruit and select minority businesses for participation in contracts.

       Minority Business Participation:

       - Each state building project shall have a verifiable ten per cent (10%) goal     for minority participation including building projects done by a private entity on a facility to be leased or purchased by the State.

        - On projects costing $300,000.00 or more, each first-tier subcontractor or Construction Manager at Risk Projects shall identify on its bid the minority businesses that it will use on its project.

Public Construction Contracts may be awarded pursuant to ANY of the following methods: Separate Prime, Single Prime, Dual Bidding, Construction Manager at Risk, Alternative Contracting Methods authorized by the State Building Commission

By: S. Jennifer Rader, Attorney, The Safran Law Offices, Raleigh NC (919-828-1396)

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Effective 10/1/01 - House Bill 1053 shortens time period in which claimant may bring action on payment bond.  Any claimant who has a direct contractual relationship with any subcontractor but has no contractual relationship, express or implied, with the contractor may bring an action on the payment bond only if he has given written notice to the contractor within 120 days (instead of current 180 days) from the date on which the claimant performed the last of the labor or furnished the last of the materials for which he claims payment, stating with substantial accuracy the amount claimed and the name of the person for whom the work was performed or to whom the material was furnished.  Applies to actions on payment bonds filed on or after 10/01/01

 

American Subcontractors Association of the Carolinas

Executive Director: Linda Burkett

104-A N. Woodland Drive, Lancaster, SC 29720

Phone:  (803 or 877) 285-3356

Fax:  (803) 285-3357

E-mail:  asac@asacarolinas.com

Web Site: www.asacarolinas.com

 

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