Background
K. Lee Builders, Inc., a licensed general contractor, entered a construction contract with Thomas Scott Barnes to build a home on Barnes’s property in Henderson, Vance County. The parties signed the contract in August 2022, and work began in November 2022. By February 2023 a dispute had emerged over plaintiff’s waterproofing of the basement; plaintiff attempted repairs but the conflict persisted, and work continued at least through September 13, 2023. On October 4, 2023, K. Lee Builders filed a claim of lien on real property under N.C.G.S. § 44A-12 asserting $53,410.76, but the document contained two incorrect dates: it listed the date of first furnishing as September 5, 2022 (more than two months before work actually began on November 2, 2022) and the date of last furnishing as August 25, 2023 (about three weeks before the actual last date of September 13, 2023).
Barnes deposited $53,410.76 with the Vance County Clerk of Court as a cash bond to discharge the lien and then filed counterclaims including breach of contract, warranty claims, fraud, and an unfair and deceptive trade practices claim under G.S. 75-1.1. Barnes moved for summary judgment on the lien, arguing the incorrect dates made the lien fatally defective. The trial court initially agreed, then reversed course and ruled the lien substantially complied because Barnes suffered no actual prejudice. After a jury trial, the jury found Barnes breached the contract and awarded K. Lee Builders $53,410.76; Barnes recovered nothing on his counterclaims. The court entered a Status Quo Order directing the Clerk to retain the bond funds pending appeal.
The Court’s Holding
The Court of Appeals reversed the lien ruling, vacated the Status Quo Order, and affirmed the jury’s breach-of-contract verdict. On the lien, the court held that a claim of lien with plainly incorrect dates of first and last furnishing is legally defective — and that no showing of actual prejudice is required. The court extended its 2025 decision in Fine Line Homes, LP v. Luthra, 298 N.C. App. 670 (2025), which held that omitting the last-furnishing date is fatal, to cover incorrect dates as well. The court reasoned that because furnishing dates determine whether the lien was filed and enforced within the statutory time limits, inaccurate dates undermine the public-notice purpose of the lien statute just as surely as a missing date. Because a claim of lien cannot be amended under N.C.G.S. § 44A-12(d), K. Lee Builders was bound by the dates as filed.
The court also narrowly construed the “obvious scrivener’s error” exception of Canady v. Creech, 288 N.C. 354 (1975), under which a facially incoherent date that no reader could take seriously will not invalidate a lien. Here, the dates were wrong — first furnishing listed more than two months before contract execution — but they were not internally contradictory or self-evidently impossible on the face of the document. Under Beach & Adams Builders, Inc. v. Northwestern Bank, 28 N.C. App. 80 (1975), a lien claimant is bound by an incorrect date that was not an obvious error apparent from the document itself, because title examiners should not be forced to investigate beyond the public record.
Because the lien was legally void, the cash bond — which under George v. Hartford Acc. & Indem. Co., 330 N.C. 755 (1992), is a substitute for the land and not a general fund of recovery — must be released to Barnes. K. Lee Builders retains its right to collect the contract judgment of $53,410.76 through other enforcement mechanisms.
Key Takeaways
- Under N.C.G.S. § 44A-12, incorrect dates of first or last furnishing are as fatal as an omitted date; the lien fails even if no competing creditor or title examiner was actually misled.
- A claim of lien cannot be amended after filing under § 44A-12(d), so contractors must verify furnishing dates against project records before filing — there is no cure once an error is made.
- The “obvious scrivener’s error” safe harbor from Canady is narrow: it requires a date that is facially incoherent (e.g., a last-furnishing date later than the filing date), not merely one that appears questionable on close inspection.
- A cash bond deposited to discharge a mechanic’s lien under G.S. 44A-16 is a substitute for the land; if the underlying lien is defective, the bond must be returned to the property owner even if the contractor prevailed on the underlying contract claim at trial.
- A defective lien does not preclude recovery on a breach-of-contract judgment; the contractor must simply collect through execution on that judgment rather than against the lien bond.
Why It Matters
North Carolina’s mechanics’ lien statute (§§ 44A-8 through 44A-24) is widely used in a state with an active residential and commercial construction market. K. Lee Builders closes a gap left open by Fine Line Homes: after this decision, both missing and incorrect furnishing dates destroy a claim of lien, regardless of actual prejudice. Contractors and subcontractors preparing lien documents must verify the dates of first and last furnishing against project records before filing, because no mechanism exists to correct an error afterward. Lenders, title insurers, and investors evaluating mechanic’s lien risks in North Carolina should also confirm that furnishing dates on any filed lien are consistent with available project documentation — a date that looks merely improbable, but is not facially impossible, will not be excused by the courts.
The decision also carries a practical lesson on cash bonds: a property owner who posts a bond to free land from a suspected lien retains the right to that money if the lien is ultimately void, even if the owner is simultaneously found to have breached the underlying construction contract. Owners facing simultaneous lien-enforcement and breach-of-contract exposure should assess lien validity carefully — a meritorious lien-defect defense can preserve the bond regardless of the contract outcome.