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Mechanic's Liens
Chicago Bull

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Have you ever seen language like the following and wondered if it was anything you needed to be concerned about?
  • "Claim of Lien filed in Judgment Docket 22, Page 98, Wake County Registry - no action to enforce filed within 180 days."

To understand this, you need a basic understanding of North Carolina's Mechanic's Lien Laws which are designed to protect certain persons who do not get paid for their labor, services or materials. "Mechanic's Lien" is a term that refers to the lien rights of mechanics, laborers, materialmen, surveyors, architects, and professional engineers (to name but a few) who have rendered services for improvements to real property pursuant to a contractual obligation. A claim of lien is to be filed (1) in the county wherein the property is located and (2) at any time after the maturity of the obligation secured thereby but not later than 120 days after the last furnishing of labor or materials at the site of the improvement by the person claiming the lien. Filing of the "Claim of Lien" is the first step and frequently this is enough to spur the debtor to pay; but if not, an action to enforce the lien may be instituted in any county in which the lien is filed. This action may not be commenced later than 180 days after the last furnishing of labor or materials at the site of the improvement by the person claiming the lien. If no action is filed within the 180 day period, the lien claimant loses his right to seek a judgment enforcing the claim of lien. For this reason, you would not need to take exception to the above claim of lien.

If the Claim of Lien is filed within the prescribed time and subsequently enforced within the statutory period, the lien relates to and takes effect from the time of the first furnishing of labor or materials at the site of the improvement by the person claiming the lien. This doctrine of "relation back" makes it possible for a mechanic's lien to have a lien position superior to that of an insured lender (or owner). This is a special concern because there will be nothing on record at the time of closing to indicate such a problem exists.

The mechanic's lien laws set forth in Chapter 44A of the North Carolina General Statutes are the basis for our lien affidavits and our standard lien exception:

  • "Any lien, or right to a lien, for services, labor or materials heretofore or hereafter furnished, imposed by law, and not shown by the public records."
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