Mechanic’s liens and COVID-19
By Nate Pierce
Attorney at Law
In the current climate, with COVID-19 sending a shockwave of uncertainty through the economy, people and companies are rethinking capital expenditures and prioritizing their debts and other obligations. The construction industry may start to see a slow down in new projects, and experience trouble collecting on past accounts. You may be inclined to offer an extension on payment of an amount owed out of a gesture of goodwill. However, it is important to remember that your right to secure payment under the mechanic’s lien statute is time sensitive and will be waived if not pursued in a timely manner. Contractors, laborers, and materialmen should keep these key points in mind concerning mechanic’s liens:
- Mechanic’s lien statutes in North and South Carolina generally provide a lien to contractors, subcontractors, and suppliers for payment for services or materials provided for the improvement of real property.
- Anyone properly licensed under state law who is owed a debt for labor performed, or materials provided, towards the erection, alteration, or repair of a building or structure upon real property is deemed to have a mechanic’s lien against the improved real property.
- You may be able to recover both the amount owed for the labor or materials provided as well as your attorneys’ fees incurred.
- In order to pursue collection under a mechanic’s lien in South Carolina, you must file a proper notice in the county where the property is located and serve the owner within 90 days of the last date of work or furnishing materials.
- In North Carolina, the time to file is within 120 days of the last date of work or furnishing materials.
- In both North and South Carolina a lawsuit to foreclose on the lien must be brought within 180 days of the last date of work or furnishing materials. If you fail to bring suit within this timeline, your right to file a lien expires and cannot be revived.
- At this time, delays caused by COVID-19 will not impact the strict statutory deadlines for mechanic’s liens. Therefore, it is more important than ever to maintain communication with your owners, document your projects accurately, and be aware of issues causing delays in payment.
The Mechanic’s Lien statute is a valuable tool for those working in the construction industry. Contact Morton & Gettys if we can help you navigate these issues in these uncertain days.
Nate Pierce is an attorney with Morton & Gettys Law Firm in Rock Hill, SC. He can be reached at (803) 366-3414 or email@example.com.
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