Picture this: You’re ready to finance a new car after building a home.
But, when you go to the bank they let you know that a mechanic’s lien is still on your property because a subcontractor wants to get paid from the general contractor.
Mechanics liens in South Dakota can be filed by any party who provides labor or material for property improvement or development. This includes a party that provided light, power, or even water to a construction project. The lien must be filed within 120 days of the date the last labor or material was provided. Once a lien is filed, it lasts a whopping 6 years in South Dakota.
So, what if you have this lien just sitting there and no party is taking action on the lien? You don’t have to wait the full six years if there is no action. A property owner can send a demand letter of sorts called “Notice to Commence Suit to Enforce Mechanics Lien.” The party must take action on the lien and commence a lawsuit within 30 days of receiving the letter. When no action is taken, the property owner can notify the register of deeds that, even after demanding it, the party still takes no action. The register of deeds then nullifies the lien.
A mechanics lien is a helpful tool for all those who work hard to build up and improve our society. Each party, even those without licenses, deserves to get paid. But that party should take action at some point prior to 6 years.
If you have any issues with a mechanic’s lien or if you need to commence suit because you have received a demand, contact the attorneys at the Goosmann Law Firm, PLC, in our Omaha, Sioux City, or Sioux Falls offices. We are here to help.