Back in 2010, when a group of construction, real property and bankruptcy lawyers first started meeting to consider potential revisions to North Carolina's lien and bond statutes, one of the driving forces behind those discussions – particularly for those who typically represent subcontractors and suppliers – was protection for downstream project participants after an upstream player filed for bankruptcy. Such protection, known commonly as the "Bankruptcy Fix," was included in the package of revisions signed into law last summer. This article explores the origins of the Bankruptcy Fix and discusses how the 2012 lien law legislation protects the right of subs and suppliers to serve a Notice of Claim of Lien Upon Funds, even after a party above them in the contractual chain files for bankruptcy.
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Construction Law Updates
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