New lien filing requirements take effect in South Carolina!
The South Carolina legislature made some changes to its mechanics lien statute this summer. Among the changes is the addition of § 29-5-15 to the South Carolina Code.
Per §29-5-15(A), contractors and subcontractors must provide the clerk of court with proof of their license or registration when a license or registration are required for the underlying labor. Although the law does not require contractors to submit a copy of their license, they must record their license or registration number on the lien document itself.
The lien statute now imposes a penalty for filing a “frivolous lien” as well. Per §29-5-15(B), a contractor who files a frivolous lien is subject to a fine of up to $5,000.00, the loss of his registration or contractor license, or both of these penalties.
It is unclear what constitutes a “frivolous lien” because the statute does not define it. Furthermore, there is no defining case law in South Carolina on the matter. However, this provision immediately follows the new requirement that contractors record their license or registration number on the lien document upon filing. Therefore, a lien filed without the contractor’s license or registration number might be considered “frivolous” under the new law.
South Carolina Governor Mark Sanford signed these provisions into law on June 2, 2009.
For more information or any legal questions regarding South Carolina construction, please contact please contact our firm at (919) 295-2846.