Claim of Lien in the Carolinas

By Ashlee Poplin, Attorney with Cotney Construction Law, Licensed and Practicing in NC and SC.

Unfortunately, many in the construction industry have engaged in a project where the compensation promised was not delivered.

There are a few remedies for such a situation including filing an action for breach of contract, filing an action for quantum meruit if the recipient has benefited without payment for the benefit, and filing a claim of lien. This article focuses on the latter, the claim of lien, and how the laws in North and South Carolina differ in making sure contactors, subcontractors and suppliers are protected.

What is a claim of Lien?

A claim of lien is a remedy that allows the filing party to claim property or funds as security against an amount of money or services owed. It will cloud title to real estate before judgment is entered which gives the filing party an extraordinary remedy that is not provided to other unpaid creditors.

How to file a claim of Lien?

First, in all the Carolinas a contractor or subcontractor that intends to file a claim of lien must be licensed. Public policy discourages unlicensed contractors and subcontractors from engaging in construction projects and therefore does not allow them the extraordinary remedy that exist for those with a license. If licensed, the next step is to determine what state and county the construction project is located. Claims of lien must be filed in the county where the property is located.

North Carolina:

In North Carolina, the law that governs a claim of lien is found at North Carolina General Statute § 44A. The statute is specific on what must be included in the claim of lien and the deadlines that are in place. Failure of absolute compliance with the statute in filing the claim of lien can jeopardize its validity. Two important deadlines to consider in North Carolina are the filing deadline and the enforcement deadline. A claim of lien in North Carolina must be filed within 120 days from the last day of furnishing labor or materials. An action to enforce a claim of lien in North Carolina must be commenced within 180 days from the last day of furnishing labor or materials.

South Carolina:

In South Carolina the law that governs a claim of lien is found in the South Carolina Code of Laws § 29-5. As with North Carolina, the law is specific on what must be included in the claim of lien and the deadlines that are in place in order to create a valid claim. The filing deadline is much shorter in South Carolina which makes prompt action important to secure a valid claim of lien. In South Carolina a claim of lien must be filed within 90 days of the last day of furnishing labor or materials. An action to enforce a claim of lien in South Carolina must be commenced within 180 days from the last day of furnishing labor and materials.

With assistance interpreting the state statutes and filing your claim of lien please reach out to Cotney Construction Law to speak with a licensed attorney.

Author’s note: The information contained in this article is for general educational purposes only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.

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