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Hudson Law News & Updates

Triggering the Statutes of Limitations for Construction Claims, or When Does the Clock Start Running?

PLEASE NOTE: This article only applies to North Carolina.  This article is designed for general information only.  The information presented in this article should not be construed to be formal legal advice nor the formation of an attorney/client relationship. This article addresses only one aspect of the statutes of limitations with regards to construction contracts.  Please contact your attorney if you need further information.

In order to avoid potential open-ended liability for an indefinite period of time, the North Carolina Legislature has enacted various statutes of limitations.  The time in which to file a lawsuit regarding improvements to real property is primarily governed by two statutes, N.C. Gen. Stat. §1-50 and N.C. Gen. Stat. §1-52.   First, N.C. Gen. Stat. §1-50 sets an outside time limit of six years for filing a lawsuit to “recover damages based upon or arising out of the defective or unsafe condition of an improvement to real property.”  The lawsuits covered by this limit include, but are not limited to, breach of contract for the construction or repair of an improvement to real property, damages for negligent construction or repair, damages for personal injury, death, or damage to property, damages for economic or monetary loss, contribution or indemnification for contract or tort damages associated with improvements to real property, and actions against materials suppliers, developers, architects, surveyors, contractors associated with an improvement or repair to real property.  Second, within the six year period, N.C. Gen. Stat. §1-52 specifies a three year limitation that begins to run when the plaintiff discovers or should have discovered the defect.  Since the discovery of defects is largely outside of the control of the builder, this article primarily discusses the limits of §1-50.

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Last Furnishing and Lien Rights

PLEASE NOTE: This article only applies to North Carolina.  This article is designed for general information only.  The information presented in this article should not be construed to be formal legal advice nor the formation of an attorney/client relationship. This article addresses only one aspect of the statutes of limitations with regards to construction liens.  Please contact your attorney if you need further information.

Most contractors are aware that, if the Owner or General Contractor on a private project fails to pay for labor or materials, the person supplying the labor or materials may file a mechanics’ lien.  Most contractors are also aware of the two strict time limits contained in Chapter 44A of the North Carolina statutes - 120 consecutive calendar days for filing a lien and 180 consecutive calendar days for perfecting that lien by filing a lawsuit.  As some contractors have found out the hard way, the lien statutes are interpreted very strictly.  As the expression goes, “close” only counts in hand grenades and nuclear bombs.  This means that, if you are even one day late in filing your lien or your lawsuit, you lose your lien and, as a result, a secured interest in the property to help secure payment.  What is not entirely clear is what triggers these periods to start running?  Both NCGS 44A-12 and 44A-13 state that both the 120 and 180 day periods start to run on the date of “last furnishing of labor or materials at the site of the improvement by the person claiming the lien.”  Since a contractor will usually negotiate with the owner for payment as long as possible before taking legal action, it is very important to know exactly what “last furnishing” means.  This article attempts to explain what the phrase “last furnishing” means and how you can determine when these deadlines will pass.

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General Liability Insurance Policy Coverage for Faulty Construction

PLEASE NOTE: This article only applies to North Carolina.  This article is designed for general information only.  The information presented in this article should not be construed to be formal legal advice nor the formation of an attorney/client relationship. This article addresses only one aspect of the insurance with regards to construction.  Please contact your attorney if you need further information.

In addition to insurance policies such as those covering workman’s compensation, premises liability, and vehicle liability, many business owners have also purchased a comprehensive general liability (CGL) policy.  The idea is to provide insurance for liability that may not be covered by other policies.  But, what does the policy actually cover?

The only way to determine the coverage is to read the policy very carefully.   Unfortunately, most policy holders never read the policy until they get sued or they have a loss and the insurance company denies their claim.  CGL policies are vague and confusing because they are drafted in the language of insurance and edited by insurance company lawyers.  It could be argued that the insurance companies are trying to leave the actual coverage in doubt so that the same language can be used to justify opposing positions to either pay or deny a claim.  If you wait until you have a claim to read the policy, it will be too late.  You should read the policy so that you know what, when, where and how you are covered in the event of a claim for defective construction.  While most CGL policies are similar, the insurance company can make changes at any time, and you have to read the policy to know what it contains. 

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Got a Traffic Ticket - Now What?

PLEASE NOTE: This article only applies to traffic citations received in North Carolina.  This article is designed for general information only.  The information presented in this article should not be construed to be formal legal advice nor the formation of an attorney/client relationship.

Traffic laws are frequently violated by many people, but there are consequences to violation of those laws, primarily financial.  As a private citizen or a business owner, everyone is subject to those costs if you, a member of your family, or one of your workers is convicted of a traffic violation.  This article is intended to better help you understand those consequences.  I have spent time as an assistant district attorney prosecuting traffic cases, and I have worked as a defense attorney defending traffic citations.  Hopefully, some of my observations will be helpful to you.

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