Summary:
In this case out of Davidson County, Fine Line Homes, LP filed a mechanic’s lien in the amount of $44,554.77 against property jointly owned by Anita Luthra and Sarina Steinbacher following a dispute over construction work at a residential home. Fine Line had a written contract with Luthra, but not with Steinbacher. After Luthra terminated Fine Line’s services and declined to pay the outstanding balance, the contractor filed a claim of lien and then brought a lawsuit to enforce the lien or, in the alternative, recover under quantum meruit.
Both defendants responded pro se, raising factual and legal defenses. Most significantly, Luthra alleged that the lien was defective because it lacked a critical statutory requirement—the date of last furnishing of labor or materials.
The trial court agreed and dismissed the lien enforcement action with prejudice, holding that the omission of the “last furnishing” date rendered the lien invalid. Relying on the plain language of N.C. Gen. Stat. § 44A-12 and longstanding case law, the trial court concluded that the date of last furnishing is a mandatory statutory element that determines the validity and enforceability of a lien. While § 44A-12(c) allows for “substantial” compliance with the lien form, the court found that omitting the date of last furnishing was a fatal error, not a mere technicality. The trial court denied dismissal of the quantum meruit claim and allowed certain counterclaims by Luthra to proceed.
Fine Line Homes appealed, arguing that the trial court improperly required strict compliance with the statute. The Court of Appeals affirmed the dismissal. Citing Brown v. Middleton, 86 N.C. App. 63 (1987), the Court reiterated that the 1977 amendment to § 44A-12 expressly requires the inclusion of the last date of furnishing. The appellate panel emphasized that this date is essential not only for public notice purposes but also to determine whether the lien was timely perfected and enforced under §§ 44A-12(b) and 44A-13(a). As the omission of this date made it impossible to evaluate the lien’s timeliness, the claim was defective on its face.
Commentary:
This case is a sharp reminder that even where courts tolerate some technical lapses under the doctrine of “substantial compliance,” certain statutory elements remain non-negotiable. North Carolina’s lien statutes strike a careful balance between protecting contractors’ rights and preserving the clarity of title for property owners and creditors. The date of last furnishing is not merely a procedural nicety; it serves as the linchpin for the 120-day lien filing and 180-day enforcement windows.
While the Court of Appeals refrained from drawing a bright line between substantial and strict compliance, Fine Line Homes reinforces that there are “substantially required” elements—and the accurate first AND last furnishing dates are one of them. Contractors and construction counsel must treat lien preparation with the same rigor as filing a civil complaint. A missing line on a form could, as here, forfeit a claim worth tens of thousands of dollars.
Those dates should be verified (including through discovery) with both the homeowner, the installer and the lienholder, a claim of lien includes a verification is recognized under N.C. Gen. Stat. § 14-209 as being made under penalty of perjury, opening erroneous claims of lien to not only potential UDTPA claims (with treble damages) but also criminal prosecution.
Consumer-side practitioners should also note how this decision preserves defenses against improperly filed liens and highlights the potential exposure contractors face to counterclaims, including fraud and unfair trade practices, when liens are filed carelessly. The validation of interlocutory appeal here under the "substantial rights" doctrine also underscores how critical lien priority is in construction disputes.
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