Subcontractors oppose ‘lien agent’ proposal pending in the General Assembly

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The American Subcontractors Association of the Carolinas (ASAC) urges its members to oppose the “lien agent redraft” proposed by title insurers before the General Assembly that take away subcontractors’ constitutionally-guaranteed lien rights. Brian Schoolman, Safran Law Offices, and several other ASAC members have attended stakeholder meetings on the “hidden liens” proposals.

The key issues are described in a letter by Mr. Schooman to the legislative aide assisting on the bill drafting for the House and to the attorneys for other interest groups.  The key items here, which could be fairer trade-offs for accepting the lien agent scheme, are (1) fixing the Pete Wall issue, so that lease arrangements or multiple-layer developments can’t be used to evade the possibility of lien rights; and (2) turning the notice to lien agent (or notice of subcontract, or whatever paperwork is demanded) into a substantive preservation of subcontractors’ lien rights, so that they can’t be undercut by a general contractor or a higher-tier subcontractor.

ASAC is asking members to call Pryor Gibson, who is Governor Perdue’s aide, at 919-733-5811, to let Mr. Gibson and the Governor know that if the lien agent bill passes as it is currently being considered, it will remove over 140 years of constitutionally mandated protection of mechanic lien rights from subcontractors and suppliers, who are in North Carolina, who pay taxes in North Carolina, and who employ tens of thousands of North Carolinians.

Mr. Schoolman anticipates that the next time the bill will be discussed publicly is at the Judiciary subcommittee’s meeting on Wednesday, June 20 at 10 AM.  It isn’t officially scheduled yet, but that is the consensus opinion for the next hearing.

 

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