North Carolina Prompt Payment Law Overview – Private Projects

North Carolina’s prompt payment statutes set forth specific timeframes when general contractors, subcontractors, suppliers, and others involved with a construction project must be paid.  This page provides an overview of these regulations, and addresses some frequently asked questions related to the North Carolina prompt payment laws. You can also read the Full Text of North Carolina’s Prompt Payment Statutes.

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Prompt Payment Frequently Asked Questions

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Do I Have To Send A Letter or File Anything To Qualify For Prompt Payment Penalties or Remedies in North Carolina?

If the provisions related to prompt payment apply in North Carolina, the only prerequisite is that labor and/or material was furnished in accordance with the provisions of the contract. Note, however, that there is no applicable statute governing prompt payment to GCs on private projects, only subs are specifically protected.

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Can I Include Prompt Payment Fees In My North Carolina Mechanics Liens Claim or Bond Claim?

No. North Carolina doesn’t allow miscellaneous amounts to be included on the face of a mechanics lien.

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If I am paid late according to prompt payment statutes, can I obtain interest or other penalty payments?

There is no specific prerequisite for interest to begin to accrue on North Carolina other than the payment being late.

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Are there reasons for which payment may be withheld past the general deadline?

North Carolina allows payments to be withheld for the following reasons:

1. Unsatisfactory progress
2. Defective work that is not remedied
3. Disputed work
4. Third-party claims
5. Failure to pay parties down-the-chain
6. Damage to contractor or other subcontractors
7. Reasonable evidence that the contract cannot be completed for the outstanding balance thereof
8. Failure to make required payments to parties below

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What is the best practice for making a demand to a non-paying party to get prompt payment fees?

Sending a notice of intent to lien and prompt payment demand is generally the best method for encouraging parties to make payment.

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