An Update On North Carolina's New Lien Agent System

Explore:  Lien Agents Liens

On April 1, 2013, the changes to North Carolina’s construction lien laws enacted in July 2012 became effective. For a general overview of the pertinent changes, please review the articles written by Brian Corbett and Tom Davis. Prior to the effective date, the North Carolina Legislature passed a bill making a few clarifications and technical corrections to the prior lien law legislation. In part, the recent enactment clarified the point in time at which the determination is made regarding the minimum $30,000 cost threshold for which the new requirement for the project owner to appoint a lien agent applies, expanded the circumstances requiring a project owner to name a successor lien agent, affected changes to the process and procedures for perfecting subrogation rights of subcontractors, and made various other minor revisions to the mechanics lien laws.

In addition, the March 2013 legislation expanded the permissible methods for delivery of notices required under the revised lien statutes to include utilization of an Internet Website designated by the lien agent for transmission of all information required to notify the lien agent of its appointment and to provide notices to the lien agent from potential lien claimants of any potential lien claims. This newly added method was in direct response to lobbying by a coalition of North Carolina title insurance underwriters who have banded together to collectively provide transaction-fee-supported lien agent services. Doing business as LiensNC, LLC, this coalition, in collaboration with NIC Services, LLC, has developed a web-based online lien agent system.

The website,, provides “one-stop-shopping” (a) to owners interested in making required lien agent appointments and remitting the required fee, (b) to contractors and subcontractors interested in filing required potential lien claim notices, and (c) to construction lenders and other third parties interested in quickly and easily monitoring the construction lien status of covered projects. The website provides a general overview of the process and history of the new North Carolina lien agent system and is user-friendly, containing a helpful guide and easy step-by-step instructions for accomplishing the user’s desired task. This website will greatly enhance and facilitate all participants’ implementation of, and compliance with, North Carolina’s new mechanics lien laws.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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