The plaintiff must cause a notice to be served a reasonable time previous to the day for appearance before the referee, appointed as provided in section 32-16-10, on each person having outstanding liens of record, who is not a party to the action, to appear before the referee at a specified time and place to make proof, by such person’s own affidavit or otherwise, of the amount due or to become due contingently or absolutely thereon. In case such person is absent or such person’s residence is unknown, service may be made by publication or notice to such person’s agent under the direction of the court in such manner as may be proper. The report of the referee thereupon must be made to the court and must be confirmed, modified, or set aside and a new reference ordered as the justice of the case may require.