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Frequently Asked Questions

Contract Drafting and Review

  1. What should a well-written contract include?
  2. Does a contract need to be in writing?
  3. What are the requirements of a contract?
  4. What is a contract?

Commercial Landlord/Tenant

  1. How can landlords protect themselves from further financial losses if the tenant appeals eviction?
  2. What is summary ejectment?
  3. What can commercial landlords do when tenants fail to pay the rent?
  4. Is the commercial landlord responsible for preventing criminal activity?
  5. What are common area maintenance costs?
  6. Who’s responsible for maintaining common areas of a commercial center?
  7. Who’s responsible for maintaining a leased commercial space?

Other Contract Disputes with Builders and Contractors

  1. How can an attorney help with my contract dispute?
  2. What are the time limitations on breach of contract claims and filings?
  3. How do you know if a breach of contract claim has occurred?
  4. What is a breach of contract?
  5. What is a contract dispute?

Payment Disputes with Builders and Contractors

  1. How can an attorney help when a mechanics lien is placed on their home?
  2. What is a mechanic’s lien?
  3. Can a contractor place a lien on my house?
  4. Can contractors increase the price of a project?

Home Construction Defects

  1. What if a contractor or builder does a bad job?
  2. What are construction defects?
  3. Do contractors and builders warranty their work?
  4. What is a warranty of workmanship?
  5. What is an implied warranty of habitability?
  6. What is an express warranty?
  7. What if the contractor will not honor the warranty?
  8. Who is responsible for construction defects?
  9. Are there any time limitations on construction defect claims?
  10. What can a construction lawyer help with an owner with their construction defect?

What should a well-written contract include?

The contents of a well-written contract largely depend on the subject and nature of the agreement. However, every contract should clearly and fully memorialize the purpose of the contract and the parties’ intentions.


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Does a contract need to be in writing?

Under North Carolina law, most contracts do not need to be in writing to be enforceable. However, there are several exceptions to that rule. For example contracts for the sale of land, promises to pay the debt of another, contracts for the sale of goods for $500 or more and several other types of agreements must be in writing. It is always best practice to memorialize your agreement in writing regardless of whether the law requires it.


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What are the requirements of a contract?

Generally, the requirements of a contract are:

1) Competence of the parties: The parties entering into a contract must be legally competent to enter into a contract. Generally, that means that each party entering into the contract is 18 years or older and has sufficient mental capacity to understand the implications of the contract. If one or more of the parties is not competent, the contract is void.

2) Proper purpose: The purpose of the contract must be legal. This means that the purpose of the contract cannot violate public policy, be immoral or violate a statute.

3) Offer: One party must communicate an offer to the other party, also known as the offeree. To effectively communicate an offer, the offeror must communicate his or her intent to enter into a contract to the offeree. The offer must be definitive and certain.

4) Acceptance: For a legally binding contract to be formed, the offeree must accept the offer without changes or a counteroffer. If the offeree counteroffers, the initial offer is terminated and the counteroffer becomes a new offer. This restarts the contract-creation process.

5) Consideration: Consideration is a new benefit, right or value that one party to a contract gives to the other. The nature of the consideration is often the reason the parties entered into a contract. The amount or value of the consideration has no impact on the validity of the contract. A contract without an exchange of consideration is invalid.

It is important to note that certain types of contracts have additional requirements.


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What is a contract?

A contract is an oral or written agreement between two or more parties, which can be enforced by a court. In modern society, contracts are the pillars of most transactions.


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How can landlords protect themselves from further financial losses if the tenant appeals eviction?

At the summary ejectment hearing, the landlord or its attorney can ask the magistrate to set an appeal bond. Under North Carolina law, the appeal bond is in the amount of the uncontested overdue rent. The appealing tenant must post that amount with the clerk’s office to stay the eviction, otherwise the landlord can proceed with the eviction even if the tenant appealed. The winner of the appeal receives the bond proceeds.


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What is summary ejectment?

Summary ejectment is a legal proceeding where the landlord seeks to evict the tenant. Landlords may pursuit summary ejectment when the tenant has failed to pay rent or breached the lease agreement in some other way.

A summary ejectment proceeding is filed with the small claims court in the county where the subject space is located. A magistrate will then conduct a hearing. At the hearing, the landlord has to burden to show that the tenant should be evicted. If the magistrate determines the tenant defaulted on paying their rent or committed any other acts that justify eviction, she will enter an order of summary ejectment.

The tenant will have ten days to appeal the order. If the tenant does not appeal, the landlord may obtain a writ of possession from the clerk. Once the writ is issued, the sheriff’s office will schedule an eviction of the tenant. Note, the sheriff’s office will not perform the eviction unless the the landlord or someone on its behalf changes the locks at the time of the scheduled eviction.


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What can commercial landlords do when tenants fail to pay the rent?

When a tenant fails to pay the rent, one option for the landlord, is to pursuit a summary ejectment. Another option includes negotiating a settlement with the tenant(s) involved. While other options exist, many are risky and expose the landlord to unnecessary liability.


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Is the commercial landlord responsible for preventing criminal activity?

Generally, a commercial landlord is not responsible for preventing criminal activity. North Carolina law does not require commercial landlords to provide security. However, one exception to this rule is when the lease agreement requires the landlord to provide security or otherwise protect the space from criminal activity. In such a case, the landlord may be in breach of the lease agreement if they fail to provide security.


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What are common area maintenance costs?

Common area maintenance costs, also known as CAM, may include the cost of maintaining and repairing the common areas. Such costs may include repair costs, security costs, property taxes, and property insurance among other items. Many North Carolina commercial leases require the commercial tenant to pay a portion of the landlord’s common area maintenance costs.


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Who’s responsible for maintaining common areas of a commercial center?

Generally, the landlord is responsible for maintaining the common areas of a commercial center. However, the landlord may require a commercial tenant to cover a portion of the costs associated with common area maintenance.


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Who’s responsible for maintaining a leased commercial space?

The terms of the commercial lease dictate who is responsible for maintaining the leased space. Therefore, you should read the lease to determine who must maintain what. If the lease is silent on this point, then the tenant must maintain the space it is renting. North Carolina law does not require a commercial landlord to maintain the rented space unless the lease states otherwise. A residential tenant, however, does have certain maintenance responsibilities under North Carolina law.


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How can an attorney help with my contract dispute?

An attorney will review your contract and gather all related facts and documents to recommend the best strategy for you. If a settlement appears to be a good option, the attorney can help you get the best deal possible. Otherwise, the attorney will determine whether the issues should be taken to court or arbitration. Furthermore, the attorney can check whether you may have any claims other than a breach of contract and warn you if the other side has strong claims against you.

Anderson Legal has substantial experience with a wide variety of contract disputes. We will carefully review your matter and provide you with the personal attention you deserve. In choosing Anderson Legal, you ensure representation by a passionate advocate who will protect you and your home.


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What are the time limitations on breach of contract claims and filings?

Yes! There are time limitations on when a breach of contract claim can be filed. If you wait too long to file, your claim may be barred and you will never be able to recover on your claim. Generally, the statute of limitations for a breach of contract claim is three years from the date of the breach. However, it is important to look to your contract to determine whether the contract imposes other time limitations.


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How do you know if a breach of contract claim has occurred?

Every case is different. The unique terms of each contract and the actions of the parties determine whether a breach of contract has occurred. Therefore, you should contact an attorney who can fully evaluate your matter and explain your options.


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What is a breach of contract?

Generally, a breach of contract occurs when a party to a contract fails to perform the promise(s) it made under the contract. However, there are exceptions to this rule. An exception for this rule occurs when a party has a legal excuse for failing to make good on its promise.

One such legal excuse is the doctrine of impossibility. Under the doctrine of impossibility, the party could not perform on the contract because performance was impossible. For example, a contractor who entered into a contract to paint a house would not be in breach of contract for failing to paint said house if the house was destroyed in an unrelated fire.

Another legal excuse is a failure to perform condition precedent. For example, if the contract required the owner to provide the contractor with written notice of when work was to begin and the owner did not do this, the contractor will not be in breach of contract for failing to begin the work.

Other legal excuses exist that prohibit the failure to perform under a contract from rising to a breach of contract. If you believe a breach may have occurred, contact Anderson Legal to determine your best course of action.


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What is a contract dispute?

A contract establishes the relationship between parties and sets forth rules for the subject transactions. A contract dispute arises when parties to a contract disagree about something related to the contract.


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How can an attorney help when a mechanics lien is placed on their home?

The stakes are high for a homeowner who is faced with a mechanics lien on their home. Ultimately, the owner is at risk of having their home sold at auction. They may also be hid with additional claims that would result them owing large sums of money to the contractor.

An attorney can review your matter and inform you of your risks. They can negotiate with the contractor on your behalf, and if need be, defend you in a lawsuit against the contractor.

In choosing Anderson Legal, you ensure that you and your home receive the care and attention you deserve. We will carefully review your case and develop a strategy to minimize your risks.

 


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What is a mechanic’s lien?

Under North Carolina law, a mechanic’s lien, sometimes called a construction lien, enables construction contractors, design professionals and suppliers to secure monies they are owed for work they performed on a construction project. There are two types of construction liens. One type of construction lien is a lien against the owner’s real property where the work was performed. This type of construction lien is available to construction professionals who have directly contracted with the project owner to improve the real property. The other type of construction lien is a lien on the funds. Liens on the funds are available to subcontractors, second tier sub contractors and third tier subcontractors. Liens on funds are placed on the monies owed to the party with whom the unpaid trade contracted.


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Can a contractor place a lien on my house?

Yes. Generally, contractors and suppliers can place liens on your residence if they have not been paid monies they are owed. North Carolina law has strict requirements for mechanic’s liens. Therefore, if a lien has been placed on your property, consult an attorney to determine whether the lien is valid.


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Can contractors increase the price of a project?

Yes. Generally, a contractor can increase the price of a project when it has performed work that is not in the existing contract.  This usually happens under two scenarios. The first scenario is when the contractor performs additional work upon the owner’s request. The second scenario is when the contractor runs into unexpected conditions requiring it to invest additional work or materials. Usually, the terms of the contract dictate how the parties must handle each of these scenarios.


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What if a contractor or builder does a bad job?

Construction projects are generally governed by contracts. When your contractor or builder does a bad job, the first thing to do is review the contract. The contract may tell you whether or not the contractor is in fact in the wrong. It may also tell you what you what options you have and how to recover from the contractor. For example, some contracts may require you to send a letter to the contractor before you file a claim. Some contracts have an arbitration provision, that requires you to arbitrate against the contractor. Many contracts give you a limited amount of time to seek recovery from the contractor. All contracts are different, so it is important to pay attention to the specifics of your contract. If the contractor or builder provided you with any written warranties, those must also be closely reviewed.


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What are construction defects?

Generally, a construction defect is a defect in the design, material or workmanship that impacts the mechanical systems, building components or structure of a construction project. Construction defects come in two forms: patent defects and latent defects. Patent defects are immediately apparent upon inspection. Latent defects are not immediately apparent and are not discoverable until later.


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Do contractors and builders warranty their work?

Yes. Under North Carolina law, in undertaking a construction project, construction professionals make certain assurances to the owner of the project. These assurances are known as implied warranties.

The warranty of workmanship and the warranty of habitability are two examples of implied warranties that apply to residential construction.

Some contractors, builders and other construction professionals also provide express warranties. Those are either verbal or written assurances a construction professional makes about the quality or state of the project.


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What is a warranty of workmanship?

Under the implied warranty of workmanship, a construction professional assures the owner that they will perform the work with ordinary skill and in a manner that a skillful workman should perform the subject work. For example, a contractor hired to install a new roof on a home assures the owner they will install the roof without defects and in the manner that a roof should be installed.


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What is an implied warranty of habitability?

The implied warranty of habitability only applies to residential construction. It warrants against substantial defects that are not immediately visible. For example, a contractor hired to install a new roof warrants that the roof will be installed so that it will not create issues that would make the home unsafe or uninhabitable.


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What is an express warranty?

Express warranties are assurances a contraction professional can provide to an owner verbally or in writing. Unlike implied warranties, North Carolina law does not require express warranties.

Express warranties can take the form of a simple sentence included in the construction contract. For example the contract can state  that the contractor  will complete the project free of defects and in accordance with the terms of the contract. Still other express warranties are memorialized in thick booklets.


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What if the contractor will not honor the warranty?

When a contractor fails to honor a warranty, the owner may have a claim for breach of warranty. Depending on the warranty, the claim may be a breach of implied warranty or a breach of express warranty.

If you believe a contractor has failed to honor its warranty, it is best to seek the help of an attorney to evaluate your case.


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Who is responsible for construction defects?

The construction professional who designed, supplied or constructed the defective portion of the home is the responsible party.


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Are there any time limitations on construction defect claims?

Yes! There are time limitations on construction defect claims. Generally, the statute of limitations for construction defect claims in North Carolina is three (3) years from the date the owner discovered or should have discovered the defect. However, there is also a statute of repose with respect to construction defect claims. Under the statute of repose, no claim for construction defects can be filed more than six (6) years after the contractor’s last act on the project regardless of when the defect was discovered. This means that if an owner discovers a construction defect four years after the project was substantially complete, it only has two years to bring its claims. It must also be noted that contracts and written warranties can also alter the time to bring a claim.


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What can a construction lawyer help with an owner with their construction defect?

A construction lawyer will review the facts and documents related to your concerns. The attorney may also help the owner hire an expert to evaluate the construction defect. While this may appear to be a costly step, it is an important one. An expert will help the parties understand the nature and extent of the defect. Once the attorney has done a comprehensive review of the matter, she can determine whether you have a claim and create a strategy. The attorney may negotiate a settlement where the contractor will either pay for repairs or perform the repairs. If appropriate, the attorney may file a lawsuit or request an arbitration on your behalf.

In choosing Anderson Legal, you ensure representation by an attorney with a strong understanding of both the legal implications and construction concepts involved in your case. Anderson Legal will closely review your case and help you understand your options. Anderson Legal will aggressively protect your interests while providing you with the personal service you deserve.


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