NORTH CAROLINA GENERAL ASSEMBLY

1979 SESSION

 

 

CHAPTER 395

HOUSE BILL 522

 

 

AN ACT TO AMEND CHAPTER 39, ARTICLE 5, SECTION 39-30 OF THE NORTH CAROLINA GENERAL STATUTES.

 

The General Assembly of North Carolina enacts:

 

Section 1.  Chapter 39, Article 5, Section 39-30 of the General Statutes is hereby amended to read as follows:

"§ 39-30.  Investigation by clerk; bond, or other securities. — (a) Upon the filing of said application and the certificate of the cost of the improvement, the clerk of the court shall satisfy himself that the land or lots are located in his county and he shall also satisfy himself of the genuineness of the application and certificate of the certified engineer or county surveyor, and shall, if so satisfied, require a good and sufficient bond, in a sum equal to the amount certified by the certified engineer or county surveyor as the approximate cost of the improvement or improvements, with a corporation licensed to do business in the State of North Carolina as surety thereon, conditioned to save the purchaser or purchasers of each lot or lots harmless to the amount of the estimated and certified cost of the proposed improvement on each lot or lots so purchased; or require (at the option of the person, firm or corporation desiring to offer the lot or lots for sale, provided that such person, firm, or corporation can establish to the satisfaction of the clerk, by sworn financial statement or otherwise, his, their, or its net worth, as of the date of the application, is equal to or greater than fifty percent (50%) of the amount certified as set forth in G.S. 39-29, above) a personal or corporate (as the case may be) guaranty in a sum equal to the amount certified by the certified engineer or county surveyor as the approximate cost of the improvement or improvements, conditioned to save the purchaser or purchasers of each lot or lots harmless to the amount of the estimated and certified cost of the proposed improvement on each lot or lots so purchased.

(b)        In lieu of the bond specified in paragraph (a) above, the person, firm or corporation seeking the permit may deposit with said clerk of court certificates of deposit, letters of credit and/or securities satisfactory to the clerk of a fair market value at least equal to one-half of the amount certified by the certified engineer or county surveyor as the approximate cost of the improvement or improvements. The certificates, letters of credit and/or securities so deposited with the clerk of court shall be held in trust for the sole protection and benefit of the purchaser or purchasers of said lot or lots from said person, firm or corporation pursuant to this Article. A pro rata portion of the certificates, letters of credit and/or securities shall be returned to the person, firm or corporation to whom such permit is issued when the clerk of court is satisfied that the value of the deposited certificates, letters of credit and/or securities is in excess of the amount required to equal one-half of the remaining cost of the then uncompleted improvements proposed to be made on each lot covered by the permit, and all the certificates, letters of credit and/or securities shall be returned if the clerk of court is satisfied that all of the improvements represented or agreed to be made have been completed. The clerk of court may sell or transfer any and all of said certificates, letters of credit and/or securities or utilize the proceeds thereof for the purpose specified in paragraph (a) above. With the certificates, letters of credit and/or securities deposited with the clerk of court, the person, firm or corporation applying for such permit pursuant to this section shall at the same time deliver to the clerk of court a power of attorney, in a form acceptable to the clerk of court, executed and acknowledged by the applicant authorizing the sale or transfer of said certificates, letters of credit and/or securities or any part thereof in order to satisfy the obligations pursuant to this section.

(c)        Permits issued by the clerk of court pursuant to this section shall constitute a lien on each lot described in said permit to the extent of the amount certified by the certified engineer or county surveyor as the approximate cost of the improvement or improvements thereon agreed to be made by the person, firm, or corporation receiving said permit. Provided, however, said lien shall not attach if a surety bond is posted pursuant to paragraph (a) above, or if certificates, letters of credit and/or securities are deposited pursuant to paragraph (b) above. Provided further, that such lien shall not have priority over any existing perfected lien or security interest.

(d)        The clerk shall release by instrument recorded in the office of the register of deeds any lien created under this Article upon a showing satisfactory to the clerk that all direct improvements to that particular lot pursuant to the application and to the certificate of the certified engineer or county surveyor have been completed.

(e)        Upon filing of a sworn, written request by the person, firm or corporation holding a permit pursuant to this Article requesting the cancellation of such permit, the clerk of court shall determine that all work commenced has been completed in accordance with the application and the certificate of the cost of the improvement and that no purchaser or purchasers of lots will be directly damaged by the cancellation of the permit. Upon such finding the clerk of court shall cancel the permit and return to the person, firm or corporation all forms of evidence of bond, certificates of deposit, letters of credit and/or securities posted to secure performance and the clerk of court shall cancel all liens created by this Article. No permit may be reinstated after cancellation except pursuant to the procedures for a new application under this Article."

Sec. 2.  This act shall be effective upon ratification and shall apply to all applications for permit filed after the effective date.

In the General Assembly read three times and ratified, this the 18th day of April, 1979.