The recent, April 2011, tornadoes are a highly visible, if (thankfully!) rare impetus for construction and contracting work to happen in earnest in North Carolina, as well as in other places. We've been helped with some reporting that provides information on avoiding scams on the front end. But what about contractors who perform work and then go unpaid?
This article gives a (very!) brief introduction to that situation. Unfortunately, sometimes the contractors and subcontractors who work to build and improve residential and commercial properties go unpaid for one reason or another. Such people (or the companies they work for) perform quality work in good faith, and the North Carolina legislature has provided a legal framework to protect them and allow them to get paid.
The lien statute (44A of the North Carolina General Statutes) allows contractors and subcontractors to place a lien, which can vary depending on whether the contractor places it or the subcontractor does, on the property they improved.
But for such subcontractors and contractors, it is important that they not delay their actions. Even if they want to avoid litigation and "play nice," the window of time to preserve their rights is narrow. Only 120 days after the last date of work on the project can pass before the right to file a claim of lien expires. Similarly, even if a lien is filed, a formal lawsuit to enforce the lien right ("perfect" the lien) must be filed within 180 days of the last date that goods or services were furnished to the property.
Because of the specialized definitions, time frames, and issues involved, it is important to contact an attorney shortly after the invoices go unpaid, so that your rights can be preserved and protected. Filing the lien or the lawsuit does not always mean going to court. However, failing to do so can leave an innocent contractor or subcontractor without the compensation and legal remedy to which their hard work should entitle them.
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