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a1handy

Can Lein holder still claim vehicle awarded in estate for mechanics lein

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I was recently awarded a vehicle that I have a mechanics lien against from an insolvent estate.  I had to go through the entire process including filing a claim, filing for a  hearing, hiring an attorney, etc.  The car that I was awarded as payment for services rendered has a lien by a large bank.  Since the bank never filed any claim against the estate for the lien does that still allow them to demand payment of the amount owed before I can obtain the title? If so what suggestions might someone have concerning on what to do next?  

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35 minutes ago, a1handy said:

I was recently awarded a vehicle that I have a mechanics lien against from an insolvent estate.  I had to go through the entire process including filing a claim, filing for a  hearing, hiring an attorney, etc.  The car that I was awarded as payment for services rendered has a lien by a large bank.  Since the bank never filed any claim against the estate for the lien does that still allow them to demand payment of the amount owed before I can obtain the title? If so what suggestions might someone have concerning on what to do next?  

 

I’m going to guess that you are an auto mechanic and had a lien on vehicle for the work you did the vehicle. That lien is not a mechanics lien; it is a personal property possessory lien. The term mechanic’s lien applies to liens on real estate for unpaid construction/repair work done on the property. If you did everything for the lien sale correctly (and since you say you hired an attorney to do it for you, I hope it was done correctly) then NC statutes tell you that (1) your personal property possessory lien has priority over any other perfected or unperfected security interest (other than a lien interest of the federal governement, which is determined by federal law); (2) that the sale proceeds go first to pay your lien, then any excess liens go to any other lien holders in order of priority, with any excess after that going to the vehicle owner; and (3) the buyer gets a title that is free of any interests in the property over which your lien has priority. The bank’s lien on the vehicle is perfected security interest and your possessory lien has priority over that. 

 

In short, if you did the sale right (and hopefully you did, as you had an attorney) the sale cleared the bank’s lien on the vehicle and the bank is only entitled to the sale proceeds in excess of the amount of your lien (i.e. reasonable charges for repairs, servicing, towing, storing, or for the rental of one or more substitute vehicles provided during the repair, servicing, or storage). The bank could not enforce the lien it has after the sale since its lien was essentially wiped out by the sale. 

 

You'll find the rules for personal property possessory liens in Chapter 44A of the North Carolina statutes. If you have problems dealing with the bank or getting a clear title document from the DMV your attorney should be able to help with that. 

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18 hours ago, a1handy said:

 

I was recently awarded a vehicle that I have a mechanics lien against from an insolvent estate.

 

 

Awarded by whom?  What do you mean when you say it was "awarded . . . from an insolvent estate"?

 

 

18 hours ago, a1handy said:

I . . . hir[ed] an attorney

 

When you asked your questions to the attorney you hired, what responses did you receive?

 

 

18 hours ago, a1handy said:

does that still allow them to demand payment of the amount owed before I can obtain the title?

 

I'm not sure what "that" refers to.  In any event, assuming the bank's lien was senior to yours, it should survive and continue to encumber the vehicle.

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The vehicle along with the lien was awarded to me by the judge overseeing the probate proceedings.  The car was in  my posession and  work had begun prior to the lien being attached. My attorney handled the proceedings concerning the  probate court.  He wants another retainer to handle future proceedings.

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By taking it through the probate proceeding, it would seem to me that the lien survives and is still valid.  Had you sold the car pursuant to your lien, it would have wiped out the lien on the car.

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