What We Know

In a case closely followed by the subcontractor and supply house industry in North Carolina, the U.S. District Court for the Eastern District of North Carolina held yesterday that filing a mechanics lien claim after a bankruptcy case has been filed does not violate the automatic stay of the Bankruptcy Code.  Subcontractors and material suppliers now have the green light to file their mechanics lien claims without fear of them being invalidated, or worse being sanctioned by the Bankruptcy Court, for violating the automatic stay. Although our firm did not participate in this case, our firm was active in several of the cases that the Court cites in its decision, particularly the Ferguson Enterprises, Inc. v. Mammoth Grading, Inc. case.