If contractors and suppliers don’t get paid on a construction project in South Dakota, they can file a mechanics lien to secure payment. A mechanics lien is a legal tool that provides the unpaid party with a security interest in the property. This page breaks down the rules, requirements, and deadlines you need to follow to file a South Dakota mechanics lien.
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Optional notice of project commencement due 30 days after commencement. Location Notice must be displayed at jobsite.
Lien must be filed w/in 120 days after last labor or materials furnished.
Enforcement deadlinesIn South Dakota, an action to enforce a mechanics lien must be initiated within 6 years from the claimant's last furnishing labor or materials.
Note that the property owner can dramatically shorten this deadline. If the owner gives request to have lawsuit initiated sooner, the deadline is shortened to within 30 days of receipt of that request.
Preliminary notice deadlinesIf general contractor filed and posted Notice of Commencement, sub-subcontractors and suppliers to subcontractors must give Preliminary Notice (to owner and general contractor) within 60 days of last furnishing labor or materials.
Lien must be filed w/in 120 days after last labor or materials furnished.
Enforcement deadlinesIn South Dakota, an action to enforce a mechanics lien must be initiated within 6 years from the claimant's last furnishing labor or materials.
Note that the property owner can dramatically shorten this deadline. If the owner gives request to have lawsuit initiated sooner, the deadline is shortened to within 30 days of receipt of that request.
Preliminary notice deadlinesIf general contractor filed and posted Notice of Commencement, sub-subcontractors and suppliers to subcontractors must give Preliminary Notice (to owner and general contractor) within 60 days of last furnishing labor or materials.
Lien must be filed w/in 120 days after last labor or materials furnished.
Enforcement deadlinesIn South Dakota, an action to enforce a mechanics lien must be initiated within 6 years from the claimant's last furnishing labor or materials.
Note that the property owner can dramatically shorten this deadline. If the owner gives request to have lawsuit initiated sooner, the deadline is shortened to within 30 days of receipt of that request.
TopicContractors, suppliers, property owners, construction lenders, and other vendors will encounter all kinds of lien-related paperwork and questions when working on South Dakota construction jobs. Here are some of the common issues you may encounter, and answers written by construction attorneys and payment experts.
In South Dakota, any party who furnishes labor and/or materials for the improvement or development of property is entitled to lien rights. This generally means general contractors, subcontractors, laborers, and material suppliers. In South Dakota, lien rights also apply to companies that furnish light, power, and/or water to a construction project.
South Dakota imposes no additional licensing requirements in order to file a mechanics lien. However, it is never a good idea to perform work for which a license is required if you do not have the required license.
In South Dakota, a mechanics lien must be filed no later than 120 days after the last date labor and/or materials were furnished. However, there is some confusion as to whether this means 120 days from the last work on the project as a whole, or 120 days form the last work by the claimant to fulfill his duties under his contract. To be safe, it may be best practice to file the lien within 120 days from the completion of the claimant’s work on the project, whether or not the project is ongoing.
A South Dakota Statement of Mechanics Lien is governed by SD Codified Laws §44-9-16, and should contain all of the following information:
• Notice of intention to claim a lien;
• Lien amount;
• Description of labor and/or materials provided;
• Claimant’s information;
• Hiring party’s information;
• First and last dates of furnishing labor and/or materials;
• Property description;
• Owner’s information; &
• Itemized statement of account.
In South Dakota, a mechanics lien requires a “description of the property to be charged, identifying the same with reasonable certainty.” While this doesn’t seem to rise to the level of requiring a full legal description, the more specific the description of the property, the better.
Attorney’s fees and collection costs are not allowable in the lien amount itself in South Dakota, but interest and attorney’s fees may be awarded to the prevailing party in an action to enforce the lien. Interest is mandated to be set at the highest legal amount by statute.
Yes, South Dakota law requires that a mechanics lien must be notarized to be valid and accepted for recording.
South Dakota mechanics lien claims are documents recorded with the county register of deeds office. For your mechanics lien to be valid, you must record it in the county where the job is physically located.
South Dakota counties each have their own unique rules and requirements. To help you, we’ve assembled all of the offices in South Dakota that record mechanics liens. These pages will walk you through the county’s specific formatting requirements, deadlines, and fees.
There are a lot of questions on this page about who can file a South Dakota mechanics lien, when it must be filed, what types of rules apply, and more. But you may be wondering something much more practical: how do I actually get my mechanics lien recorded and filed?
• For a full breakdown of the process, you may want to consult: How to File a South Dakota Mechanics Lien | A Step-by-Step Guide
Notice is required, but technically, it is not notice that the lien was recorded. Rather it is notice that the lien will be recorded. South Dakota requires that a copy of the lien must be mailed to the property owner prior to the lien being filed with the Register of Deeds. A post office receipt of mailing must be attached to the lien filed with the register of deeds for proof of mailing to the property owner.
In South Dakota, an action to enforce a mechanics lien must be initiated within 6 years from the date of last furnishing labor or materials to the project.
However, if the property owner makes a written demand on the lien claimant to commence the action to enforce the lien, the lien claimant must initiate the action within 30 days from receipt of the written demand – or the lien will be extinguished.
Yes, California is considered a “full-price” lien state, meaning that the lien claim will secure the full amount unpaid to the lien claimant, regardless if the GC has been paid in full or not.
It depends. In South Dakota, a mechanics lien has priority over all other liens or encumbrances on the property except liens of the United States, South Dakota, or liens that were previously recorded or of which the mechanics lien claimant had actual knowledge.
For priority purposes, a mechanics lien attaches to the property from the first date of visible construction on the property. However, there is a very complicated provision of South Dakota mechanics lien law that provides a mechanism for filing a Notice of Contract with the Register of Deeds which, if filed, may give the mechanics lien priority over a construction lender.
South Dakota lien law provides that when a recorded lien is satisfied by payment, foreclosure, compromise, or any other method, the lien claimant must execute and deliver a Satisfaction with Mechanics Lien to the property owner. The satisfaction must be executed before two witnesses and filed with the Register of Deeds.
This requirement is strict; if the lien claimant doesn’t execute and deliver the satisfaction within 10 days from the written demand of the property owner or other interested party, the lien claimant will be liable for damages, attorney’s fees, and an additional penalty of $100.
I'm sorry to hear about the trouble you have been having. To tackle the first part of your question as to whether it is required to send a preliminary notice in South Dakota, it depends. On private projects, general contractors are not required to send a preliminary notice. However, if the GC filed a notice of commencement, subcontractors and suppliers must send a preliminary notice on private projects.
If you are dealing with a GC in this case and they weren't required to file a preliminary notice before filing a mechanics lien, this Levelset post in regards to disputing an invalid lien claim will likely be helpful to you.
Answered by Kire' Jackson | Levelset Admin https://www.levelset.com/payment-help/question/l/Mechanics liens are generally available to those who have performed work but not been paid for the work they've done. However, if a contractor hasn't fully performed under their contract and finished the job, that contractor generally won't be entitled to full payment. Before looking further, I think this article might provide some value to you: A Mechanics Lien Was Filed on My Property – What Do I Do Now?
The fastest and cheapest way to have a lien removed will typically be to have the claimant release their lien themselves. And, an owner may be able to convince the claimant to abandon the lien by threatening to pursue legal action to have the lien removed and to recover damages under a claim like slander of title. Another potential option might be to negotiate a partial payment in exchange for the release. While that might not be easy to stomach, it would likely be cheaper and less stressful than challenging a lien via legal action. Finally, as you mentioned above, challenging the lien claim via legal action is another popular option. And, it's pretty common for owners to take a mechanics lien dispute to court - especially when there are obvious issues with the lien. Your attorney will be able to evaluate the validity of the claim that was filed then advise on how best to combat it.
Answered by Matt Viator | Levelset AdminI'm sorry to hear about that. First, it's worth noting that a property owner or other payor's first reaction to a lien filing is typically to challenge that lien. We discuss the idea in depth here: My Lien Was Challenged — What Do I Do?. As discussed in the article - a challenge against a lien does not necessarily indicate that there's an issue with the lien filing. That being said, zlien has noted the potential for the South Dakota lien enforcement period to be shortened to 30 days in several areas on its website, including: (1) in the South Dakota Lien and Notice FAQs (under "When is the Deadline to Enforce a South Dakota Mechanics Lien, or, How Long is My Lien Effective?"); and (2) 3 Important Nuances Within South Dakota Mechanics Lien Law. under § 44-9-26 of the South Dakota lien statute, an owner, an owner's agent, or a contractor can shorten the timeframe during which a South Dakota lien is effective by sending a written demand to the lien claimant. However, such a notice will only be effective to shorten the timeframe to lien if the written demand was served on the lien claimant and the party attempting to shorten the timeframe has provided proof that such a notice was sent to the party who held the lien. In the event that the notice was not properly sent to the lien claimant and/or that the party attempting to shorten the timeframe for lien has no proof that the lien holder was properly served, the time to enforce a filed South Dakota mechanics lien will not be shortened. Of course, it might be up to the lien claimant to dispute that the lien period should not be shortened - and that could take some sort of further legal action, such as a motion with the relevant court to dispute the issue. Finally, it's worth noting that while zlien provides a substantial amount of legal information regarding the lien laws across all 50 states, zlien is unable legally advise any user.
Answered by Matt Viator | Levelset AdminContractors & suppliers have strong lien rights in South Dakota. If a contractor or supplier isn’t paid on an South Dakota job, they can turn to filing a lien to speed up payment and protect themselves. However, there are specific requirements and rules that must be followed. Here are 5 essential things you need to know about South Dakota’s mechanics lien law.
Any party– including general contractors, subcontractors, material suppliers, and laborers– who furnishes labor or materials for the improvement or development of property has South Dakota mechanics lien rights. South Dakota also allows lien rights to parties that furnish light, power, or water to a construction project. Most states require all mechanics lien claims be filed with the county recorder or clerk of court. In South Dakota, however, there are at least 2 offices where mechanics lien claims can be filed, and the lien claimant must make certain they file their lien claim in the right office. Generally speaking, like all other states, mechanics liens in South Dakota must be filed with the county recorder (the Register of Deeds) of the county where the construction project is located. However, the mechanics lien claim must be filed with the Secretary of State (and not the Register of Deeds) if the claim is for materials or services furnished for construction on power, electric, light, telephone or telegraph lines, or on railways.
The deadline to file a mechanics lien in South Dakota is 120 days from last furnishing labor or materials to a project. However, it is unclear whether the 120 day period begins from the last date the claimant furnished to the project, or 120 days from the last furnishing date on the project as a whole by any party. Because of this confusion, it is best practice to file within 120 days of your last date of furnishing to the project. HOWEVER, a Mechanics Lien’s Effectiveness Can Be Drastically Limited. South Dakota has one of the longest mechanics lien claim periods in the United States. After a mechanics lien is filed in the state, it is effective against the property for a total of six years! This is almost as long as standard judgments in many states. However, there is an exception. At any time, a property owner can deliver a written demand to the lien claimant requiring the lien claimant to commence suit to enforce the mechanics lien claim. This demand is referred to as a “Notice to Commence Suit to Enforce Mechanics Lien.” The mechanics lien claimant must start its lawsuit to enforce the lien claim within 30 days of receiving this notice, and if the lawsuit is not commenced, the mechanics lien claim will be rendered null and void.
General contractor and subcontractors are never required to send a preliminary notice. Sub-subcontractors and material suppliers need to send a Notice of Furnishing Labor or Materials within 60 days of first furnishing labor and materials to the project to the property owner and general contractor if the general contractor filed and posted a Notice of Commencement at the jobsite within 30 days of commencement of the project. If this Notice of Commencement was not filed and posted, there are no preliminary notice requirements for sub-subcontractors and material suppliers.
General contractors may file (and post) a notice of commencement to provide some protection against the liens of sub-subcontractors and suppliers to subs, but this notice is not necessary.
South Dakota does not require a party to be licensed in order to have lien rights and file a claim, although it is never recommended to perform work without a license if a license is required.
Those owed money on a project in South Dakota must file their mechanics lien within 120 days from last furnishing labor or materials to a project. However, a property owner can delay this process for at least 10 days by service an “Owners Demand for Lien Account” upon any potential lien claimant.
This “Owners Demand” must be within 15 days from the completion of the construction contract. If it is timely made, the lien claimant may not file a mechanics lien for at least 10 days after the lien account is furnished to the property owner.
While this may seem like a small delay or inconvenience, it can turn out to be much more, especially if the property owner were to make the demand for lien account near the end of a claimant’s deadline to file a mechanics lien. Theoretically, if a request was made at this time, the lien claimant could be forced out of its mechanics lien rights because the 10 day waiting period is not cause to extend a mechanics lien deadline.
