Under South Carolina law, any person who is owed money for providing labor, materials, or service actually used in building, repairing, or altering a building may file a mechanic’s lien against the property where the building is located. See S.C. Code Ann. § 29-5-10. When a mechanic’s lien is filed against the property, the owner cannot use the property as collateral or sell any parts of the property until he satisfies the lien.

The owner may, however, go on the offensive and take certain actions to remove the lien from his property. There are several statutory and non-statutory actions an owner may take. Each has benefits and limitations but, as shown below, the non-statutory actions are usually more advantageous and more pro-active.

   South Carolina statutes allow an owner to move to dismiss the lien if the lien claimant fails to file the lien within 90 days after the furnishing of labor or materials. See S. C. Code Ann. 29-5-90. Additionally, the owner can move to dismiss if the lien claimant fails to bring suit to enforce the lien within 6 months after the furnishing of the labor or materials. See S.C. Code Ann. 29-5-120. The owner may also move to dismiss if he can show that the lien claimant has willfully and knowingly claimed more than is due. See S.C. Code Ann. 29-5-100.

   Moreover, the owner may remove the lien from his property by posting cash or a surety bond with the office of the clerk of court or register of deeds in an amount equal to 1 1/3 of the amount of the lien. See S.C. Code Ann. 29-5-110. As a last resort, the owner may defeat the lien by taking the matter to trial and winning.

   These above statutory actions are not advantageous to most owners because they require large amounts of money (as with the bond) or large amounts of time with the property remaining encumbered by the lien (as with the time limitations for filing and bringing suit and with going to trial). Fortunately, South Carolina courts have provided a non-statutory procedure for owners to remove a lien from their property quickly and without the need for a large cash or surety bond.

   In Sea Pines Co. v. Kiawah Island Co., Inc., 268 S.C. 153, 232 S.E.2d 501 (1977), the Supreme Court recognized for the first time a non-statutory pro-active procedure available to owners dealing with a mechanic’s lien that has been wrongfully imposed on their property and cannot be corrected by statutory means. Sea Pines filed a mechanics lien against Kiawah for work regarding the development of the island as a luxury resort. In response, Kiawah filed an affidavit that said the debt claimed by Sea Pines bore no relation to the material and services furnished by Sea Pines. The judge vacated the mechanic’s lien after Sea Pines failed to show cause why the lien should not be withdrawn, cancelled, or reduced. The Supreme Court held that a judge’s authority to vacate a mechanic’s lien is similar to the judge’s authority to grant summary judgment (granted where there are no genuine issues of material fact) or a directed verdict (granted where a jury could only find in favor of one party).

   The Court outlined examples of causes of action a party may bring to move the court to vacate a lien. An owner may bring a cause of action seeking declaratory judgment as to the validity of the lien and seeking cancellation of the lien and/or an owner may bring a cause of action seeking an order canceling the lien under a special proceeding and Rule to Show Cause Hearing. The owner should be sure to accompany any Complaint with a Motion for an Expedited Hearing and should be sure that each cause of action seeks recovery of attorney fees.

   In Cedar Creek Properties v. Cantelou Associates, Inc., 320 S.C. 483, 465 S.E.2d 774 (Ct. App. 1995), the Court of Appeals removed any uncertainly in the ability of the prevailing party to collect attorney fees when bringing a cause of action under Sea Pines. The Court held that the costs incurred by a property owner in defeating a mechanic’s lien qualify as costs within the statutory meaning and therefore can be recovered by the prevailing party. In addition, the court held that attorney fees are available even when a filer of a lien cancels the lien prior to trial. Cantelou filed a mechanics lien against Cedar Creek but cancelled the lien just prior to the start of trial. The court made clear that Cedar Creek was entitled to any attorney fees expended in its effort to defeat Cantelou’s lien.