Tuesday, May 25, 2010

South Carolina Mechanics Lien Filings

In the state of South Carolina, liens filed on private property are known as Mechanics’ Liens. When a South Carolina construction lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property. South Carolina law does not allow contractors working on public contracts to file any mechanics’ liens. Rather, contractors have bond claim rights pursuant to statutory law.

As for who is permitted to file a mechanics lien, contractors, subcontractors, sub-subcontractors, and suppliers all have construction lien rights under South Carolina Lien Law.

Prior to filing a mechanics lien, under South Carolina law, a “notice of furnishing labor or materials” must be provided by a subcontractor or supplier in order to maintain mechanics lien rights. Such notice requirements may be inapplicable if an owner fails to file a “notice of project commencement” within 15 days of commencement of the work.

A South Carolina mechanics’ lien claim must be filed within 90 days after completion of the contractors work. A lawsuit to foreclose upon the South Carolina construction lien must be brought no later than 6 months after the claimant ceases to furnish labor or materials.

To file a lien claim in South Carolina, the claimant need not have a written contract to perform the work for which the mechanics lien is being filed.  Oral contracts are sufficient, as long as there is sufficient evidence to indicate that a contract indeed exists.

Filing a mechanics lien claim is a great way to protect your accounts receivables because on a private project, the South Carolina mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the mechanics lien.  On a public project, the South Carolina mechanics lien freezes the money owed to you so that the public entity cannot distribute it to the person that is not paying the lien claimant.

In addition to South Carolina mechanics lien claims, LienItNow.com also provides other methods for collecting money that is owed on a construction project.  These other services include the provision of Stop Notices and Bond Claims.

A Stop Notice is a notification that has the ability to enhance the effectiveness of a mechanic’s lien.  A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project.  Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim.  The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid.

Bond claims can only be filed on a project where the owner, contractor or subcontractor has obtained a payment bond to ensure that every contractor receives payment for the work performed on the Project.  The payment bonds issued by sureties for construction projects have specific timing requirements, but most require claimants to submit claims against the bond within sixty to ninety days from the claimants’ last date of work.  Bond claims are more effective than a lien claim because the payment bond acts as a guarantee that payment will be made for work properly completed.

For more information on filing a South Carolina Construction Lien, a South Carolina Mechanics Lien, a South Carolina Stop Notice, a South Carolina Bond Claim, or a South Carolina pre-lien notice, please visit http://lienitnow.com/south-carolina-faq.asp

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