A subcontractor has not been paid by the general contractor on a public project. Under NC lien law, what is the subcontractor's primary remedy?
Correct Answer
C) Make a claim against the payment bond
On public projects, subcontractors cannot file mechanics' liens but can make claims against the payment bond required for public construction projects.
Why This Is the Correct Answer
On public construction projects in North Carolina, subcontractors cannot file mechanics' liens against government-owned property because the government holds sovereign immunity and cannot have its property encumbered. Instead, NC requires general contractors on public projects above a certain threshold to obtain a payment bond. Subcontractors' primary remedy is to make a claim against this payment bond under NC G.S. 44A-27 et seq.
Why the Other Options Are Wrong
Option A: File a mechanics' lien on the property
Filing a mechanics' lien on the property is NOT available for public projects. Government-owned property (state, county, municipal) is immune from mechanics' liens. This remedy is only available on private property.
Option B: Sue the property owner directly
Suing the property owner (the government) directly is generally barred by sovereign immunity without specific statutory authorization. The payment bond system exists precisely as an alternative to direct suits against the government.
Option D: File a complaint with the licensing board
Filing a complaint with the licensing board is a disciplinary remedy against the contractor's license, not a payment remedy. The licensing board cannot compel payment or adjudicate payment disputes.
Memory Technique
Public = Bond. Private = Lien. The government owns the land and you cannot lien government land — so the bond is the substitute protection. Think 'Public Bond, Private Lien.'
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