Mechanics liens are legal rights that help ensure construction industry participants are able to get paid the money they’ve earned on their projects and jobs. This article provides a step-by-step guide detailing how to file a mechanics lien in the state of South Carolina.
Why File a Mechanics Lien?
Have you ever walked onto a new job or project and thought, “I can’t wait to file a lien!” Of course not!
Nobody likes liens! This includes the folks that are on the receiving in of a lien filing, as well as the poor folks that have been backed into a corner because of a payment issue that they can’t resolve. Mechanics liens are the nuclear option when it comes to construction nonpayment, and typically, it’s a good idea to exhaust all available options before deciding to go with a lien.
Still – problem jobs happen, and sometimes a payment issue will persist despite the best intentions to make it go away. If payment isn’t coming and it’s time to bring out the big guns, you’d better be prepared. Thankfully, construction industry members in all 50 states have access to powerful laws — mechanics lien laws — that practically guarantee your right to get paid the money you earned on your projects. But, since each state’s mechanics lien law is different, it makes sense to take a closer look at the mechanics lien process in the state of South Carolina.
Who Can File a South Carolina Mechanics Lien?
Any party who furnishes labor or materials used in the “erection, alteration, or repair of a building or structure” or “for the improvement of real property” is entitled to mechanics lien protection in South Carolina. The statute is very broad. It covers pretty much anyone working on a project, regardless of tier – from architects all the way to suppliers and equipment lessors.
Help and additional resources are available on the zlien South Carolina Lien and Notice FAQ page
But wait, there’s more!
South Carolina actually security guards on construction sites to claim a mechanics lien as a laborer. That’s right, security guards! Landscapers are provided lien protection as well if the service exceeds $5,000.
In order to file a South Carolina mechanics lien, it’s important that a lien claimant be licensed. If licensure is required, the failure to maintain that license can prohibit a lien claimant from recovery. Regardless of lien rights, though, it’s a good idea to obtain the required licensure.
Is Preliminary Notice Required in South Carolina?
Yes and no.
South Carolina is one of a handful of states that utilizes a Notice of Commencement. General contractors can file a Notice of Commencement, but they don’t have to. But, if a Notice of Commencement is filed, the amount of any remote claimant’s mechanics lien cannot exceed the amount that the GC owes their first tier sub at the time of the claim. In other words, by utilizing a Notice of Commencement, a general contractor can limit lien exposure on their projects – and that’s something most GC’s are interested in.
For subcontractors, suppliers, and other parties who don’t have a direct contract with the property owner, preliminary notice is required. Specifically, a Notice of Furnishing Labor or Materials must be filed in order to preserve the right to lien. This notice is a little weird too, though.
Unlike preliminary notices in other states, this notice doesn’t have a strict deadline. Rather, it must only be sent before filing and serving a lien claim – so, in theory, a claimant could wait to send notice until they know a payment dispute is afoot. But that’s a bad idea.
The amount that a claimant can recover through a lien claim is actually tied to when this notice is sent. It will preserve the right to lien for the amount that is owed and unpaid between the GC and the party who hired the remote claimant. That means the earlier sent, the better.
Take a Deep Dive into the SC Notice of Commencement! South Carolina’s Notice of Commencement Is a Little Bit Odd
SC Mechanics Lien Form Requirements
South Carolina mechanics liens don’t require a specific statutory form. However, there is certain information that must be included. The lien must include the following information:
- A just and true account of the amount due
- A description of the property sufficient for identification
- Name of property owner
- Claimant’s contractor license number or registration (if required to be licensed or registered
Of course, the form must also be notarized. Considering how strict some other states can be, all in all, the South Carolina mechanics lien requirements are pretty light.
In fact, compared to some other states, these “requirements” might be downright lenient. According to the South Carolina mechanics lien law, as long as the property can be reasonably recognized, an error in the lien statement won’t invalidate the lien unless the claimant has willfully and knowingly claimed more than the amount that’s due.
Deadline for Filing and Service
A South Carolina mechanics lien claim must be filed no later than 90 days from the last day that labor/materials were furnished. South Carolina, unlike most other states, does allow for an extension to this deadline for “call-back” or warranty work. This means that if a party returns to the jobsite to do work pursuant to a warranty or just to fix something, the 90-day clock starts ticking from that new, later date. Again – leniency.
Once filed, the claimant must serve the property owner with a copy of the lien within the same 90-day period. Plus, depending on the county where the project is located, you may be required to submit proof of service on the owner before filing.
What Happens Next?
Hopefully, payment happens next! Of course, not all mechanics lien filings will immediately result in payment.
If a mechanics lien is filed and payment still isn’t coming, enforcing the lien may become necessary. In South Carolina, a mechanics lien will expire unless it is enforced within 6 months from the claimant’s last furnishing. Additionally, a notice of Lis Pendens must be filed in order to notify the owner of the pending lawsuit concerning his property.
[Note, that if the claimant files the lien before the last date of furnishing, then the 6-month deadline runs from the date the lien is filed rather than the last date of furnishing.]
Adding a step in between filing a lien and enforcing that lien can often help to force payment. There’s a reason the lien enforcement deadline is so far away from the lien filing deadline. Hopefully, during that 6-month window of time, the parties can resolve the dispute without the need for a lawsuit.
But sometimes, a property owner or contractor might need a little extra push. A claimant can provide that push with a Notice of Intent to Foreclose. By sending a Notice of Intent to Foreclose, a lien claimant literally puts the other side on notice: If payment isn’t made and made soon, then a lien enforcement suit will be filed.
Still Unpaid After Filing a Lien? Consider Sending a Notice of Intent to Foreclose
If the Debt Gets Paid, Release the Lien
When the underlying debt is paid, it’s time to release the mechanics lien. This is a general principle that applies to every state, but South Carolina specifically requires it. The lien claimant must execute the lien release, but the debtor (owner or contractor) is obligated to pay for it.
SC Mechanics Lien Forms – Free Downloads
Mechanics Lien Form (when hired directly by project/property owner)
Mechanics Lien Form (when hired by a party other than project/property owner)