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Where do my lien rights stand with a change of ownership of the property I am currently doing work at?

South CarolinaMechanics Lien

Hello, we are nearing the completion of a commercial project in SC. The owners have sold the complex and I want to see what our lien rights are and if we need to give them any upfront notices.

1 reply

Aug 18, 2021

Generally, mechanics lien rights stick with the project property. So, when the property is sold mid-job, the new owners should become responsible for any potential lien claims. Levelset discusses that in these article: What Happens If I Filed My Mechanics Lien After the Property Was Sold?

According to South Carolina's priority rules, a mechanics lien filed after the new owner's mortgage wouldn't take priority over the mortgage. However, a lien claim should certainly be an alarming development for a new commercial owner and could force some action on their part - whether that be them stepping in to resolve the matter, them contacting the prior owner and forcing them to deal with the matter, or some other resolution.

As for required notices - South Carolina general contractors don't have any mandatory preliminary notices, so there's no notice that becomes required simply due to the sale of the property. Note, though, that contacting the new owner to notify them about the payment situation would be wise. 

To the extent it looks like a lien may be required to recover payment, it'd also be wise to send any payment reminders, demands, or Notices of Intent to both the original owner and the new owner - the more eyes on the issue, the better the chances that recovery. Plus, if all parties are brought to the discussion, that'd improve transparency on the payment communications and could lead to a quicker resolution. Not to mention, an original owner who's failed to make payment could run into even bigger issues surrounding the sale.

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