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Woukd this be considered willful fraudulent lien?

South CarolinaBack ChargesChange OrdersConstruction AccountingConstruction ContractRight to Lien

Our General Contractor previously offered in writing, verbally, and written on invoices delay credits AND offered in writing, verbally and on invoices covered expenses that accrued without our knowledge (and only being informed of after the fact of their completion). The relationship soured towards the end of the project and now he has generated a fraudulent invoice to include these fees, charges, and expenses that were previously in writing, verbally, and noted on invoices as being not part of the owed expenses for renovation. He has threatened a mechanic lien on residence. Do we have a case to prove intentional and willful fraud?

1 reply

Jan 27, 2020
First, note that it's extremely common for a mechanics lien to be filed when there's a dispute as to what's owed. And, as long as the claimant has some argument that the amount liened is, in fact, due - the lien generally won't be tossed aside as intentionally fraudulent. Levelset discusses that idea in the following articles: (1) Frivolous Mechanics Liens: Intentionally Fraudulent vs. Honest Mistakes; and (2) Prove It! Proving Fraud on a Mechanics Lien Claim Can Be a Challenge. Looking to § 29-5-100 of South Carolina's mechanics lien statute, it states that an inaccuracy in the lien amount won't invalidate the claim unless the lien claimant "has wilfully and knowingly claimed more than is his due." So, if the contractor genuinely believes that they're owed the claimed amounts and if they can argue that point, then there's a strong chance their lien would remain valid, at least to some degree. At the same time, though, if the court finds the contractor knowingly and maliciously changed the prices they were charging in order to file an inflated lien claim, that could render a lien claim invalid. Plus, it's certainly possible that after a battle over the claim and debt owed, that contractor may well lose on the claim or have it reduced by the court. When a lien has been threatened, it might be a good idea to consult a local attorney to see what defenses might be available and to negotiate on your behalf. Plus, they'll be able to take action like sending a demand that the claimant either adjust their claim or refrain from filing it altogether. Further discussion on that, here: I Just Received a Notice of Intent to Lien – What Should I Do Now?
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