Liens (Nc Bar 2013)

Front 1

Personal Property liens (general rule)

Back 1

Person who provides storage or repair services for personal property entitled to lien on that property to secure payment.

Front 2

What happens if lienholder does not possess

Back 2

Knowing, voluntary relinquishment of property = lien is lost.

Front 3

Priority: Personal property lien vs. pre-existing perfected Article 9 security interests

Back 3

Personal property lien wins. Not "first in time."

EXCEPT landlord and innkeeper liens are still subordinate.

Front 4

Elements of a General Service and Storage Lien (GSSL)

Back 4

1) Work performed pursuant to contract
2) Work performed in ordinary course of lienor's business

Front 5

If item brought in by not true owner

Back 5

Thief = no lien
Lawful possessor but not owner = $100 max lien i.e. lienholder can only demand $100 from true owner before relinquishing property, then must sue for remaining balance.

Front 6

Maximum lien for GSSL

Back 6

Reasonable value of services, NOT a higher contract price.

Front 7

Motor Vehicles lien

Back 7

Pursuant to contract, ordinary course of lienor's proper business

No $100 limit when received from mere lawful possessor

Motor boat not a motor vehicle -- "commonly used on highway"

Front 8

Rights of purchaser at personal property lien foreclosure

Back 8

Lienholder gets rights of selling lienholder, takes priority over Art. 9 security interest with standard exceptions (e.g. landlord/innkeeper).

Front 9

When is RP lien created

Back 9

At the first furnishing of goods or services

Front 10

When is RP lien perfected

Back 10

Notice given to the Lien Agent designated by the owner of RP

Front 11

How is RP lien effectively enforced

Back 11

(short SoL)

Filed with clerk within 120 days of completion of work

Also sent to owner of the project

If a subcontractor, give notice to general contractor

Suit to enforce within 180 days after completion.

Front 12

When is no notice to lien agent required for RP lien

Back 12

Cost of improvements <$3,000

Repairs on a consumer's primary residence

Front 13

RP lienholder gets maximum protection when it gives notice to the lien agent when?

Back 13

15 day grace period after first day or work to get priority as if filed on first day. After 15 days can still file, but no earlier priority than day of filing.

Front 14

How does a contractor find out who lien agent is?

Back 14

1) Owner must name when filing work permit
2) Notice sign on worksite
3) Asking owner (who must tell them)

Front 15

Who can *subject* a property to a lien

Back 15

1) Owners
2) Tenants
3) Prospective buyers

Front 16

Can owner avoid liens by having a tenant agreement that bans them from getting repairs/improvements without approval?

Back 16

No (if contractor doesn't know about the tenant agreement)

Front 17

Does RP lienholder have lien to entire plot of land?

Back 17

No, only "enough" surrounding land to make it useful.

Front 18

Does RP lien include attorney and collection fees?

Back 18

No, only for work done.

Front 19

Who can *claim* a lien?

Back 19

One who "contributes to permanently affixed improvement on property."

e.g. surveyor, architecht, civil engineer, excavator, a/c unit seller, firm leasing crane used for construction

NOT carpet installer (not permanently affixed), real estate appraiser to get favorable mortgage (not an improvement).

Front 20

SoL for RP liens

Back 20

Claim of lien <120 after last bonafide furnishing of services (completion of work). e.g. Not just touch-up painting.
Suit to enforce lien <180 after completion of work.

Front 21

When does RP lien begin?

Back 21

physical commencement at the job site.

EXCEPT engineers & architects

Front 22

Subcontractor lien (rule)

Back 22

Subcontractor can claim lien on funds owed to the person who hired him.

Landowner->Gen K'er->1st tier subK'er->2nd tier subK'er

Front 23

NC statute for 2nd tier subK'ers

Back 23

2nd tier sub is subrogated to the rights of the 1st tier sub (and 1st tier sub can get lien on funds owed by landowner to genK'er).

Front 24

How does sub get lien upon funds?

Back 24

Send letter stating:

1) he hasn't been paid
2) brief description of work done

Front 25

Does a subK'er asserting lien against funds need to give notice to lien agent?

Back 25

No

Front 26

What if part owing money ignored notice of lien on funds

Back 26

1) *personally* liable to sub
2) If that person is the owner, sub could get lien on owner's land with proper notice to Lien Agent.

Front 27

Most likely way to defeat sub's claim of a lien upon funds.

Back 27

prior party (e.g. owner) already paid ALL money owed to party above the sub (e.g. General K'er) (i.e. no money left in entire project to disperse).

Front 28

What if general contractor waives its right to lien on RP?

Back 28

First tier sub that was subrogated to general K'er loses right to lien.

Front 29

How can general K'er cut off second tier sub's access to RP lien?

Back 29

Simply notifying 2nd tier sup that he has paid 1st tier sub already.

Front 30

General priority rule for tax liens

Back 30

Government always wins. No state law claim has priority over it.

Even against preexisting recorded mortgage
Even against BFP of property with tax lien

Front 31

Priority between county and city tax liens?

Back 31

City & County share pro-rata (in proportion to amount owed to each)

Front 32

When does tax due become a lien

Back 32

As soon as property is listed for tax purposes around January 1st.

Front 33

Are tax liens in the chain of title for a parcel of property?

Back 33

Yes

Front 34

What type of judgment gives rise to a judgment lien

Back 34

Only money judgments

Front 35

What does judgment lien attach to

Back 35

only real property, not bank accounts, personal property, etc.

Front 36

What does the doctrine of instantaneous seisin do?

Back 36

Subordinates a prior judgment lien to a purchase money mortgage.

Front 37

What must be done to judgment to give rise to a lien?

Back 37

Docketed

Front 38

How do you prioritize multiple judgment liens in after-acquired property?

Back 38

Pro-rata, NOT first in time.

Front 39

Is an enacted reversion "after acquired property"?

Back 39

No. Reversion always existed.

Front 40

What is attachment lien

Back 40

Pre-judgment lien before P has established claim's validity (courts hesitant)

Front 41

Before attachment lien granted, P must show:

Back 41

1) Risk D will be unvailable at time of judgment; OR
2) Assets will be unavailable because they will be secreted away.

*More available against non-residents with assets in state.

Front 42

Attachment lien if debtor regularly forces creditors into costly litigation?

Back 42

No. "Difficult" not enough.

Front 43

Attachment if resident debtor regularly leaves for a definite period of time to a specific location?

Back 43

No, maybe if indefinite/nonresident/unknown location.

Front 44

While under threat of suit, D gives money to creditors and gives all spare cash to daughter. Attachment lien?

Back 44

1) No, ordinary course of business
2) Yes, personal and unusual.