State Codes and Statutes

State Codes and Statutes

Statutes > North-carolina > Chapter_131E > GS_131E-244

§ 131E‑244. Accounting lien for expenses.

(a)        Within 30 days after termination of the temporarymanagement, the temporary manager shall give the court a complete accountingof:

(1)        All property of which the temporary manager took possession;

(2)        All funds collected under this Article;

(3)        Expenses of the temporary management; and

(4)        All disbursements or transfers of facility funds or otherassets made during the period of temporary management. On the same day theaccounting is filed with the court, the temporary manager shall serve on therespondent by registered mail a copy of this accounting.

(b)        If the operating funds collected during the temporarymanagement exceed the reasonable expenses of the temporary management, thecourt shall order payment of the excess to the respondent, after reimbursementto the contingency fund. If the operating funds are insufficient to cover thereasonable expenses of the temporary management, the respondent shall be liablefor the deficiency, except as described in this section.  If the respondentdemonstrates to the court that repayment of amounts spent from the contingencyfund would significantly impair the provision of appropriate care or servicesto residents, the court may order repayment over a period of time with orwithout interest or may order that the respondent be required to repay onlypart or none of the amount spent from the contingency fund. In reaching thisdecision, the court may consider all assets, revenues, debts and otherobligations of the long‑term care facility, the likelihood of the sale ofthe long‑term care facility where repayment forgiveness would result inunjust enrichment of the respondent, and shall consider the impact of itsdetermination on the provision of care to residents.  The respondent maypetition the court to determine the reasonableness of any expenses of thetemporary management.  The respondent shall not be responsible for expenses inexcess of amounts the court finds to be reasonable.  Payment recovered from therespondent shall be used to reimburse the contingency fund for amounts used bythe temporary manager.

(c)        The court may order that the Department have a lien for anyreasonable costs of the temporary management that are not covered by theoperating funds collected by the temporary manager and for any funds paid outof the contingency fund during the temporary management upon any beneficialinterest, direct or indirect, of any respondent in the following property:

(1)        The building in which the long‑term care facility islocated;

(2)        The land on which the long‑term care facility islocated;

(3)        Any fixtures, equipment, or goods used in the operation ofthe long‑term care facility; or

(4)        The proceeds from any conveyance of property described insubdivisions (1), (2), and (3) of this subsection made by the respondent withinone year prior to the filing of the petition for temporary management unlesssuch transfers were made in good faith, in the ordinary course of business, andwithout intent to frustrate the intent of subsection (b) of this section.Transfers made coincidental with serious deficiencies in resident care may beconsidered evidence of intent to frustrate the intent of subsection (b) of thissection.

(d)        To the extent permitted by other provisions of applicableState or federal law, the lien provided for in this section is superior to anylien or other interest that arises subsequent to the filing of the petition fortemporary management under this section, except for a construction ormechanic's lien arising out of work performed with the express consent of thetemporary manager.

(e)        The clerk of court in the county in which the long‑termcare facility is located shall record the filing of the petition for temporarymanagement in the lien docket opposite the names of the respondents andlicensees named in the petition.

(f)         Within 60 days after termination of the temporarymanagement, the temporary manager shall file a notice of any lien created underthis section.  If the lien is on real property, the notice shall be filed withthe clerk of court in the county where the long‑term care facility islocated and entered on the lien docket.  If the lien is on personal property,the lien shall be filed with the person against whom the lien is claimed, andshall state the name of the temporary manager, the date of the petition fortemporary management, the date of the termination of temporary management, adescription of the property involved, and the amount claimed.  No lien shallexist under this section against any person, on any property, or for any amountnot specified in the notice filed under this section. (1993, c. 390, s. 1.)