In South Carolina, contractors and suppliers who aren’t paid for their work on a construction project can use a mechanics lien to secure payment. This legal tool gives the unpaid party a claim against the property.
At CRM Lien Services, we specialize in ensuring you get paid quickly and reliably. We can prepare and file mechanics liens for you, taking into account South Carolina construction lien law and state-specific rules and regulations, including the need for an adequate and ascertainable description of the real estate.
This guide outlines the necessary steps, rules, and deadlines for filing a mechanics lien South Carolina, ensuring your payment rights are protected.
Key Takeaways
- South Carolina Mechanics Liens Offer Broad Protection – Contractors, subcontractors, suppliers, and even security guards and landscapers (for projects over $5,000) can file a lien to secure unpaid work. Understanding the specific regulations regarding who is authorized to file South Carolina liens is crucial, as the process and requirements vary by project type.
- 90-Day Filing Deadline with Extensions for Call-Back Work – South Carolina allows a 90-day window to file a lien, which can be extended if additional work or repairs are performed under warranty.
- Preliminary Notice Not Required but Beneficial – While not mandatory, filing a preliminary notice or a Notice of Commencement can help protect lien rights, especially for subcontractors and suppliers.
Who Can File a South Carolina Mechanics Lien?
In South Carolina, individuals or businesses that provide labor or materials for the “construction, modification, or repair of a building or structure” or “enhance real property” are eligible for mechanics lien protection. The scope of mechanics lien rights in South Carolina is extensive, covering contractors, subcontractors, laborers, architects, engineers, surveyors, and equipment lessors.
Additionally, South Carolina grants mechanics lien rights to security guards employed at a site of real property improvement, recognizing them as laborers. As outlined by law, those offering landscaping services can also claim a lien if the service costs over $5,000 and is based on a written contract with the property owner.
It is important to note that contractors must be licensed or registered to file a mechanics lien if the law requires them to hold such credentials for the work they perform.
Is a Written Contract Required to File a Mechanics Lien in South Carolina?
A written construction contract in South Carolina is not required to file a mechanics lien. However, it’s strongly recommended that a direct contractual agreement be in writing to prevent misunderstandings or potential issues during the project.
What Is the Deadline to File a South Carolina Mechanics Lien?
South Carolina mechanics liens must be filed within 90 days from the last day the claimant provided labor or materials to the project. Unlike many states, South Carolina often permits “call-back” or warranty work to extend the filing deadline. This means if a contractor returns to repair or fulfill a warranty, the 90-day window typically starts from the date the project commences.
Additionally, some counties in South Carolina require proof that the lien was served on the property owner before the lien can be officially filed.
What Information Should Be Included in a South Carolina Mechanics Lien?
Under S.C. Code §29-5-90, a South Carolina Notice of Mechanics Lien must include specific details such as:
- Information about the claimant;
- The amount claimed, supported by a verified statement of account;
- A description of the property intended to be covered by the lien, ensuring it is sufficiently accurate for identification purposes;
- Details of the property owner and
- Contractor license or registration number, if required.
Can Attorney Fees, Collection Costs, or Other Amounts Be Included in the Lien Amount?
Legal counsel should be consulted to understand that attorney’s fees and collection costs cannot be included in the lien amount. However, in a lien enforcement action, the prevailing party, whether the lien claimant or the property owner, is entitled to recover costs and attorney’s fees. These fees must be reasonable and cannot exceed the total amount of the lien.
Do I Need to Send a South Carolina Preliminary Notice?
It depends on the situation. General contractors can file a Notice of Commencement with the Clerk of Court or Register of Deeds in the county where the property is located. While not required, this notice offers the general contractor some protection. If filed, liens from remote claimants (such as sub-subcontractors or suppliers to subs) are limited to the amount the general contractor owes the subcontractor with whom the remote claimant contracted.
If a lien claimant is hired by someone other than the property owner, they can protect their mechanics lien rights by delivering a Notice of Furnishing Labor or Materials before filing and serving the lien. It’s important to note that the lien amount for remote claimants can be reduced if the notice is not sent or is delayed, so it’s best to send the Notice of Furnishing early to secure full lien rights.
Proper notification by certified or registered mail is crucial to ensure that the owner is aware of storage costs and to facilitate the legal sale process if the owner fails to claim the property.
What Happens If I Send the South Carolina Preliminary Notice Late?
If the general contractor fails to file a notice of commencement on time, any payments made to a subcontractor will not reduce the amount a lower-tier party can recover. However, the total lien amount cannot exceed what the owner owes for such labor.
Although there is no strict deadline for filing a Notice of Furnishing Labor or Materials, it’s important to note that a remote claimant’s recoverable lien amount is limited to what the general contractor owes the subcontractor who hired the remote claimant. Therefore, filing the notice earlier is advisable. Additionally, some sources suggest that whether or not the general contractor files a notice of commencement might not impact this outcome.
Who Cancels the South Carolina Mechanics Lien After Payment Is Received?
South Carolina lien law states that once a debt secured by such lien is fully paid, the creditor must either mark the lien as discharged on the registry where the lien is recorded or provide a release that can be filed in the same registry. However, the debtor is responsible for covering the cost of this release process.
Essential Things to Know About Filing a South Carolina Mechanics Lien
Contractors and suppliers in South Carolina enjoy strong lien rights. Filing a mechanics lien can expedite payment and safeguard their interests when payment is delayed or withheld. However, there are specific rules and requirements to follow.
Here are five key things to know about South Carolina’s mechanics lien laws:
1. Licensed Contractors Have Lien Rights
In South Carolina, any party contributing labor or materials to a property’s construction, alteration, or repair can file a mechanics lien. This includes licensed contractors, subcontractors, laborers, architects, engineers, surveyors, and equipment lessors. An interesting aspect of South Carolina’s lien law is that even security guards at construction sites and landscapers can claim lien rights, provided the landscaping work exceeds $5,000. Importantly, contractors must be licensed for their work, and their license number must be included in the lien claim.
2. South Carolina’s Unique Lien Filing Deadline
The mechanics lien filing deadline in South Carolina is 90 days from the last day the claimant provided labor or materials for the project. However, South Carolina is unique in allowing “call-back” work—additional services or repairs requested after a project is marked complete—to restart the 90-day filing period, provided that specific information is posted at the job site. This makes it easier to extend the lien deadline when final work is required after substantial completion.
3. Preliminary Notice Isn’t Mandatory but Can Safeguard Rights
While sending a preliminary notice is not required in South Carolina, doing so can better protect your lien rights. A general contractor has the option to file a Notice of Commencement within 15 days of starting a project with the Clerk of Court or Register of Deeds in the property’s county. This notice helps safeguard the general contractor’s rights, while subcontractors and suppliers to subcontractors should consider filing a Notice of Furnishing Labor or Materials to ensure their lien rights are fully protected. This notice can be sent to the general contractor via certified mail.
4. Proof of Service May Be Required Before Filing a Lien
In some South Carolina counties, before filing a mechanics lien, you must provide proof that the property owner has been served with a copy of the lien. Even if this is not required in every county, the property owner must be notified within the same 90-day filing window. If the owner cannot be located, the lien can be served on the individual in possession of the property, and a sheriff’s affidavit confirming the owner could not be found must be filed. Service of the lien must be conducted by the sheriff rather than through mail or a private process server.
Mechanics Liens Don’t Have Priority Over Prior Recorded Mortgage Holders
Mechanics liens in South Carolina generally do not take priority over earlier claims, such as mortgages held by prior recorded mortgage holders. The state follows the “first in time, first in the right” rule, where the timing of filings determines priority. If there aren’t enough funds to pay all valid mechanics liens, lienholders share funds pro rata. Additionally, subcontractors and third-tier claimants usually have priority over general contractors.
Understanding these essential aspects of South Carolina’s mechanics lien laws can help contractors, subcontractors, and suppliers better protect their payment rights on construction projects.
How to File a Mechanics Lien in South Carolina?
Mechanics liens are legal tools that help construction professionals and suppliers secure the payments they are owed on their projects. This guide offers a clear, step-by-step breakdown of the process of filing a mechanics lien in South Carolina.
Since South Carolina has specific rules and county-level requirements, it’s easy to make a mistake that could invalidate your lien. If you’re ready to file on your own, here’s a step-by-step guide to help you.
Step 1: Getting Started on Your South Carolina Mechanics Lien
To begin the lien filing process, you’ll need to prepare the lien form correctly. This section will guide you in choosing the right form and filling it out accurately to ensure your claim is valid.
A. Choosing the Correct Form
Filing a mechanics lien South Carolina doesn’t require a specific statutory form, but certain details must be included to ensure the lien is valid. While many online resources offer free forms, they may not always meet legal requirements. Always double-check that the form covers all necessary information.
B. Filling Out Your Lien Claim
Simply filling out the form isn’t enough—you need to ensure all the information is accurate and complete. A small mistake can result in your claim being rejected.
- Claimant Information: Be sure to list your full legal name. If you’re filing on behalf of a company, use the officially registered business name to avoid challenges to your claim.
- Amount of Claim: The amount you claim should reflect the unpaid value of labor or materials you provided. It may include interest and reasonable legal fees, but be cautious not to overestimate. Filing a frivolous claim could result in penalties or even losing your contractor’s license.
- Property Description: The lien must include a clear description of the property. While it doesn’t need to be a full legal description, a simple street address may not be sufficient. Add as much detail as possible to accurately identify the property. This is crucial as all parties to a lien and other creditors with liens created from the same construction project will contest matters of debt related to the same property.
- Owner Information: Gather as much information as possible about the property owner. If there are multiple owners or a transfer of ownership during the project, you must document this thoroughly.
- Contractor License Number: Include your license or registration number on the lien form if your work requires a South Carolina contractor license.
- Verified Statement of Account: This section should outline all relevant payment terms from your contract, including the original contract price, payments received, and outstanding balance.
- Signature & Notarization: Your mechanics lien claim must be signed and notarized to be legally valid.
Step 2: Serving Notice on the Property Owner
South Carolina requires that the property owner be served with notice of the lien within the same 90-day period the lien is filed. Understanding the specific regulations regarding South Carolina liens is crucial, as some counties require proof of this service before accepting the lien. South Carolina mandates that the sheriff must personally serve the owner; if the owner cannot be located, the lien can be served on the person in possession of the property.
Step 3: Filing the Mechanics Lien in South Carolina
A. When to File
In South Carolina, you must file your lien within 90 days from the last date you provided labor or materials to the project. The state also allows for a unique extension in “call-back” or warranty work cases, where the 90-day period restarts from the last date of any additional work performed.
B. Where to File
Mechanics liens must be filed with the Clerk of Court or Register of Deeds in the county where the project is located. Each county has its own filing requirements, but South Carolina generally has standardized fees and minimal document formatting requirements. It’s still advisable to confirm requirements with the local office before filing.
What Happens Next?
Once the lien is filed, it’s possible that payment will follow without further action. However, a South Carolina mechanics lien is only valid for 6 months. If payment is not received, you’ll need to take further action.
Release of Lien Claim
Once you receive full payment, you must release the lien. South Carolina law requires the lien claimant to file a release of lien, at the debtor’s expense, in the same office where the lien was initially filed.
Enforcement Action
If payment is still not forthcoming, you may need to enforce the lien through foreclosure. This must be done within 6 months of the lien filing date, or the lien will expire. You will also need to file a notice of Lis Pendens, informing the property owner of the pending legal action.
If filing a full lawsuit seems too costly, an alternative is to send a Notice of Intent to Foreclose, signaling your intent to pursue legal action if payment is not made. This can often result in a resolution before a lawsuit becomes necessary.
By following these steps, you can file a mechanics lien in South Carolina and increase your chances of getting paid for your work.
Get in Touch
In conclusion, filing a mechanics lien in South Carolina is an essential legal tool for contractors, subcontractors, and suppliers to secure payment for their work. By understanding the specific steps, deadlines, and requirements outlined in this guide, you can effectively protect your rights and increase the chances of timely payment.
At CRM Lien Services, we have been serving customers nationwide with required reference documentation for lien claims since 1986. We assist property owners in navigating the mechanics lien process, informing them about their rights and responsibilities, including providing notices, securing payment, and releasing mechanic’s liens.
We have a wealth of expertise, are licensed and insured, and have a team of highly knowledgeable document processors. If you’re looking for a straightforward process for filing a mechanics lien, give us a call or shoot us an email.
