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TITLE 44 LIENS
CHAPTER
44-9 MECHANICS’ AND MATERIALMEN’S LIENS
44-9-1 Persons Entitled to Lien
44-9-2 Authorization of Improvements, Repairs by Lessee
44-9-3 Lien on Title of Vendor
44-9-4 Notice of Nonresponsibility, Posting, Service
44-9-5 Homestead
44-9-6 Amount of Lien
44-9-7 Priorities
44-9-8 Bonafide Purchasers
44-9-9 Prorata Payment of Liens
44-9-10 Service of Sworn Account, Withholding of Funds
44-9-11 Payments to Claimant, Disputes
44-9-12 Recovery from Owner
44-9-13 Diversion of Funds, Theft
44-9-14 Demand for Verified Account
44-9-15 Statement of Claim, Filing
44-9-16 Statement of Claim, Contents
44-9-17 Service of Lien Statement
44-9-18 Filing and Indexing
44-9-19 Fees
44-9-20 Claims Against Multiple Improvements
44-9-21 Satisfaction of Lien
44-9-22 Demand for Satisfaction, Penalty, Attorneys Fees
44-9-23 Venue, Proceedings
44-9-24 Limitations
44-9-25 Parties
44-9-26 Demand for Commencement of Action
44-9-27 Summons and Complaint
44-9-28 Notice of Pendency
44-9-29 Order to Appear, Publication
44-9-30 Consolidation
44-9-31 Bill of Particulars
44-9-32 Pleadings
44-9-33 Proceedings
44-9-34 Receiver
44-9-35 Receivership
44-9-36 Receiver’s Certificates
44-9-37 Compensation of Receiver
44-9-38 Power to Appoint Receiver
44-9-39 New Parties, Postponements
44-9-40 Judgment, Costs
44-9-41 Costs
44-9-42 Attorney’s and Receiver’s Fees
44-9-43 Personal Judgment, Subrogation
44-9-44 Sale, Proceeds, Distribution Prorata
44-9-45 Leasehold, Redemption
44-9-46 Severance of Building
44-9-47 Confirmation of Sale
44-9-48 Resale
44-9-49 Ordinary Actionsz
CHAPTER
44-9A CONSTRUCTION LIEN WAIVER AGREEMENTS
44-9A-1 Waivers
44-9A-2 Endorsement of Joint Check and Agreement of Waiver
44-9A-3 Joint Check Provision
44-9A-4 Joint Check Endorsement, Effect
44-9A-5 Release of Proceeds of Joint Check
SOUTH
DAKOTA CODIFIED LAWS
TITLE 44 LIENS
CHAPTER 44-9 MECHANICS’ AND MATERIALMEN’S LIENS
44-9-1 Persons Entitled to Lien
Whoever shall, at the request of the owner or the duly authorized
agent or representative of the owner, or of any contractor
or subcontractor, furnish skill, labor, services, including
light, power, or water, equipment, or materials for the improvement,
development, or operation of property as hereinafter specified,
shall have a first lien thereon and the appurtenances thereto,
prior and superior to all other liens except those of the
state or of the United States, and except existing liens,
mortgages, or other encumbrances then of record or of which
the lien claimant has actual notice, for the price or value
of the same, so furnished, subject to the further provisions
of this chapter, as follows:
(1) For the erection, alteration, repair, or removal of any
building, fixture, bridge, fence, or other structure or for
grading, filling in, or excavating the same, or for digging
or repairing any ditch, drain, well, cistern, reservoir, or
vault thereon or for laying, altering, or repairing any sidewalk,
curb, gutter, paving, sewer, pipe, or conduit in or upon the
same or in or upon the adjoining half of any highway, street,
or alley upon which the property abuts, a lien upon the said
improvement and the land on which it is situated, or to which
it may be removed;
(2) For the construction, alteration, or repair of any line
of railway or of any telegraph, telephone, electric light,
or power line, or of any line of pipe, conduit, or subway
or any structure, appliance, or fixture upon or appertaining
to any of them, a lien upon the public utility so constructed,
altered, or repaired and upon the line, plants, and property
thereof and upon all the rights, franchises, and privileges
of the owner appertaining thereto;
(3) Upon any mine or mining claim, oil or gas well or spring,
a lien upon the same and any rights, privileges, franchises,
easements, and tangible property and other property or appliances
appurtenant thereto, for any of the items hereinbefore specified
or referred to as giving right to a lien.
44-9-2
Authorization of Improvements, Repairs by Lessee
When improvements are made by one person upon the land of
another, all persons interested therein otherwise than as
bona fide prior encumbrancers or lienors shall be deemed to
have authorized such improvements, insofar as to subject their
interests to the liens therefore; provided that as against
a lessor no lien is given for repairs made by or at the instance
of his lessee.
44-9-3 Lien on Title of Vendor
Whenever land is sold under an executory contract authorizing
the vendee to improve the same, and such contract is forfeited
or surrendered after liens have attached by reason of such
improvements, the title of the vendor shall be subject thereto,
but he shall not be personally liable if the contract was
made in good faith.
44-9-4 Notice of Nonresponsibility,
Posting, Service
Any person who has not authorized the improvement may protect
his interests from such liens by serving upon the persons
doing the work or otherwise contributing to such improvement,
within five days after knowledge thereof, written notice that
the improvement is not being made at his instance, or by posting
like notice, and keeping the same posted, in a conspicuous
place on the premises.
44-9-5
Homestead
The lien shall not extend to nor affect any rights in any
homestead so far as the same is exempt from levy and sale
on execution.
44-9-6
Amount of Lien
If the contribution be made under a contract with the owner
and for an agreed price, the lien as against him shall be
for the sum so agreed upon together with the cost of any additional
material or work agreed upon, otherwise, and in all cases
as against others than the owner, it shall be for the reasonable
value of the work done, and of the skill, material, and machinery
furnished.
44-9-7
Priorities
Such lien as against the owner of the property shall attach
and take effect from the time the first item of material or
labor is furnished upon the premises by the lien claimant,
and shall be preferred to any mortgage or other encumbrance
not then of record, unless the lien holder had actual notice
thereof.
44-9-8
Bonafide Purchasers
As against a bona fide purchaser, mortgagee, or encumbrancer
without notice, however, no lien shall attach prior to the
actual and visible beginning of the improvement on the ground,
but a person having a contract for the furnishing of labor,
skill, material, or machinery for such improvement, may file
with the register of deeds of the county within which the
premises are situated or of the county to which such county
is attached for judicial purposes, or if claimed under subdivision
(2) of section 44-9-1, with the secretary of state, a brief
statement of the nature of such contract, which statement
shall be notice of his lien for the contract price or value
of all contributions to such improvement thereafter made by
him or at his instance.
44-9-9
Prorata Payment of Liens
All liens, claims for labor performed, or services or materials
furnished, as provided in subdivision (3) of section 44-9-1,
shall be concurrent liens upon the property charged and shall
be paid pro rata out of the proceeds arising from the sale
thereof, if the same shall be sold, or upon settlement without
sale.
44-9-10
Service of Sworn Account, Withholding of Funds
Any person furnishing any of the items for which a lien may
be claimed under the provisions of section 44-9-1 under a
contract, either express or implied between the owner of the
property or his duly authorized agent or representative, and
any contractor working upon or about such property may serve
upon the owner, or his duly authorized agent or representative
at any time, a sworn account and notice of his claim showing
the items and amounts and the dates that the same were furnished,
and thereupon the owner shall withhold from his contractor
so much of the contract price as may be necessary to meet
the claims of persons who have served such accounts and notices.
44-9-11
Payments to Claimant, Disputes
Whenever any such account and notice is served upon the owner
of the property or his duly authorized agent or representative,
he shall furnish his contractor with a copy of the same, and
if such contractor shall not within fifteen days after the
receipt of such account and notice give the owner, his agent,
or representative, written notice that he intends to dispute
the claim, he shall be considered as assenting thereto and
such owner may pay the same to the claimant when it becomes
due and deduct the amount out of any moneys due such contractor,
who may in like manner deduct such amount from any moneys
due from him to his subcontractor or the claimant.
44-9-12
Recovery from Owner
The amount which may be due from any contractor to his creditor
may be recovered from said owner by the creditor of said contractor,
in any action at law, to the extent and value of any balance
due by the owner to his contractor under the contract with
him, at the time of the notice first given as provided in
section 44-9-10, or subsequently, according to such contract
or under the same.
44-9-13
Diversion of Funds, Theft
Any contractor, subcontractor or supplier on any improvement
of real estate, mines, or public utilities within the purview
of this chapter who knowingly uses more than five hundred
dollars of the proceeds of any payment made to him on account
of such improvement by the owner of such real estate or person
having the improvement made, for any other purpose than the
payment for labor, skill, materials, and machinery contributed
to such improvement while any account for such labor, skill,
material, or machinery furnished for such improvement up to
the time of such payment remains unpaid and due and owing
under the credit terms arranged, is guilty of theft of the
proceeds of such payment. It is not a violation of this section
to withhold funds from a contractor, subcontractor or supplier
pending the completion and final approval of his work or product.
44-9-14 Demand for Verified Account
The owner, by serving written request within fifteen days
after the completion of the contract, may require any person
who may have a lien under the provisions of this chapter,
to furnish him an itemized and verified account of his lien
claim, the amount thereof, and his name and address. No action
or other proceeding shall be commenced for the enforcement
of such lien until ten days after such statement is so furnished
pursuant to the request of the owner. The word “owner”
as used in this section shall include any person interested
in the premises otherwise than as a lien holder thereunder.
44-9-15 Statement of Claim, Filing
The lien shall cease at the end of one hundred twenty days
after doing the last of such work, or furnishing the last
item of such skill, services, material, or machinery, unless
within such period a statement of the claim therefore be filed
with the register of deeds of the county in which the improved
premises are situated, or of the county to which such county
is attached for judicial purposes, or if the claim be under
the provisions of subdivision 44-9-1 (2), with the secretary
of state.
44-9-16 Statement of Claims, Contents
Such statement shall be made by or at the instance of the
lien claimant, shall be verified by the oath of some person
shown by such verification to have knowledge of the facts
stated, and shall set forth:
1) A notice of intention to claim and hold a lien, and the
amount thereof;
(2) That such amount is due and owing to the claimant for
labor performed, or for skill, services, material, or machinery
furnished, and for what improvement the same was done or supplied;
(3) The names and post-office addresses of the claimant, and
of the person for or to whom performed or furnished;
(4) The dates when the first and last items of the claimant’s
contribution were made;
(5) A description of the property to be charged, identifying
the same with reasonable certainty;
(6) The name and address of the owner thereof at the time
of making such statement, according to the best information
then had; and
(7) An itemized statement of the account upon which the lien
is claimed.
44-9-17 Service of Lien Statement
Before filing such lien statement, the person claiming the
lien shall mail to the property owner at his last known post-office
address, by registered or certified mail, a copy of such lien
statement and the post-office receipt for such mailing shall
be attached to the lien statement and filed in the office
of register of deeds.
44-9-18 Filing and Indexing
The register of deeds shall file such statement or lien in
numerical order and enter the same upon a register to be kept
for that purpose containing the name of the owner of the property
against whom the lien is claimed, date of filing, amount,
description of the property affected by the lien and a blank
space for the date of release. In addition, if such lien affects
the title to real property, he shall enter the same upon the
mortgage or lien index described in section 7-9-9.
44-9-19 Fees
The register of deeds shall charge a fee of three dollars
for the filing and indexing of any lien under the provisions
of this chapter and the further sum of one dollar for the
filing and indexing of any assignment or satisfaction of such
lien, which sums may be taxed as costs in favor of the lien
holder.
44-9-20 Claims Against Multiple Improvements
Except as in the case of condominiums under the provisions
of section 43-15A-29, a lien holder who contributes to the
erection, alteration, removal or repair of two or more buildings
or other improvements situated upon or removed to one lot,
or upon or to adjoining lots, under or pursuant to the purposes
of one general contract with the owner, may file one statement
for his entire claim, embracing the whole area so improved.
Alternatively, he may apportion his demand between or among
the several improvements and shall assert a lien for a proportionate
part upon each and upon the ground appurtenant to each respectively.
44-9-21 Satisfaction of Lien
Whenever a lien has been claimed by filing the same in the
office of the register of deeds and it is afterward satisfied
by payment, foreclosure, compromise, or other method, the
creditor shall execute and deliver to the owner of the property
a satisfaction describing the lien by its date, date of filing,
amount claimed, description of the property, and the names
of the lien claimants and owner of the property. Such satisfaction
shall be executed before two witnesses or acknowledged before
a notary public, and upon presentation to the register of
deeds, he shall file the same and cancel the said lien of
record.
44-9-22 Demand for Satisfaction, Penalty,
Attorneys Fees
If any holder of a lien under the provisions of this chapter
shall neglect to execute and deliver such satisfaction within
ten days after written demand therefore by the owner of the
property or any person interested therein, when such lien
has in fact been satisfied as provided in § 44-9-21,
he shall be liable to the person demanding such satisfaction
for all damages, costs, and expenses, including attorney’s
fees, and an additional penalty of one hundred dollars.
44-9-23 Venue, Proceedings
The lien may be enforced by action in the circuit court of
the county in which the improved premises or some part thereof
are situated, or of the county to which such county is attached
for judicial purposes, or, if claimed under subdivision 44-9-1(2),
of any county through or into which said railway or other
lien extends, which action shall be begun and conducted in
the same manner as actions for the foreclosure of mortgages
upon real estate, except as herein otherwise provided.
44-9-24 Limitations
No lien shall be enforced in any case unless the holder thereof
shall assert the same, either by complaint or answer, within
six years after the date of the last item of his claim as
set forth in the filed and entered lien statement; nor shall
any person be bound by the judgment in such action unless
he is made a party thereto within said six years.
44-9-25 Parties
The action to foreclose the lien may be commenced by any lien
holder who has filed his lien statement as required in this
chapter, and all other such lien holders who are not joined
with him as plaintiffs shall be made defendants. Any such
lien holder not named as a defendant may nevertheless answer
the complaint and be admitted as a party. All parties having
liens under this chapter may join as plaintiffs, if they so
desire, prior to the commencement of any action by a single
lien holder.
44-9-26
Demand for Commencement of Action
Upon written demand of the owner, his agent, or contractor,
served on any person holding a lien, requiring him to commence
suit to enforce such lien, such suit shall be commenced within
thirty days after such service, or the lien shall be forfeited.
44-9-27
Summons and Complaint
The action shall be commenced by issue of a summons and filing
complaint in the office of the clerk of courts.
44-9-28
Notice of Pendency
At the beginning of the action the plaintiff shall file for
record with the register of deeds of the county in which the
action is pending and of the several counties into which the
utility extends, if the lien is claimed under subdivision
44-9-1(2), a notice of the pendency thereof. After such filing
no other action shall be commenced for the enforcement of
any lien arising from the improvement described, but all such
lien claimants shall intervene in the original action by answer
as provided in section 44-9-25.
44-9-29 Order to Appear, Publication
Upon the application of the plaintiff, or anyone claiming
an interest in the property, the court may make an order requiring
all persons claiming any interest in the property or lien
thereon to appear in the action, either by complaint in intervention
or by answer, and to set up whatever rights, claims, or interests
they may have in and to the property involved in the action,
within a time to be fixed by the court in its order, which
shall not be less than sixty days after the first publication
of the same. The order shall be published in a legal newspaper
of the county once each week for at least four weeks, and
if within the time specified in said order, any party shall
not appear and assert his claim by proper pleading, he shall
be forever barred from claiming any right, lien, or interest
against the property, and judgment shall be entered in favor
only of those who appear and establish their liens, claims
or interests.
44-9-30 Consolidation
If more than one action shall be commenced in good faith for
foreclosure of liens upon the same property, all shall be
consolidated and tried as one, under such order of the court
as may best protect the rights of all parties concerned.
44-9-31
Bill Particulars
Each lien holder shall attach to and file with his complaint
or answer a bill of the items of his claim, verified by the
oath of some person having knowledge thereof, and shall file
such further and more particular account, as the court may
at any time direct. Upon his failure to file such original
or further bill, his pleading shall be stricken out and his
claim disallowed.
44-9-32
Pleadings
All averments of the answer shall be deemed denied without
further pleading.
44-9-33 Proceedings
All provisions of Title 15 shall be applicable to foreclosure
actions under this chapter, except where a different intention
plainly appears from the provisions of this chapter.
44-9-34
Receiver
Whenever action has been commenced for the foreclosure of
liens, under this chapter, and a majority of the lien holders,
parties to such action, shall by motion request the appointment
of a receiver the court may appoint a receiver to take possession
of all the property covered by such liens and to take care
of and preserve the same.
44-9-35 Receivership
In all cases of liens arising under the provisions of subdivision
44-9-1 (2) a receivership may be created in the first instance
instead of directing a sale of the property.
44-9-36
Receiver’s Certificates
The court may authorize such receiver to issue receiver’s
certificates to persons furnishing services, supplies, or
equipment only to the extent necessary for preservation of
such property, and for taxes, insurance, and similar charges
necessary to protection of the property. Such certificates
maybe made prior and preferred claims to all other liens of
every kind and character, except court costs and expenses
of sale, if such priority and preference shall be deemed necessary
by the court for proper preservation and care of the property.
The provision for such receiver’s certificates may be
made in the judgment of foreclosure or in any intermediate
judgment or supplemental judgment.
44-9-37
Compensation of Receiver
The compensation of the receiver shall be fixed at a reasonable
daily rate by order of the court for each day that the receiver
is actually engaged in the performance of his duties.
44-9-38
Power to Appoint Receiver
Nothing in Sections 44-9-34 to 44-9-37, inclusive, shall abridge
the power of the court otherwise to appoint a receiver under
the provisions of chapter 21-21.
44-9-39
New Parties, Postponements
If upon the trial of such action, or at any time before the
rendition of final judgment therein, it shall appear to the
satisfaction of the court that a proper party who may still
be brought in has been omitted, or that any party then entitled
to answer has not yet appeared, or that for any other reason
the trial or judgment should be delayed, or the judgment as
ordered or entered be modified, the court may postpone the
trial, or make such other or further order in the premises
as shall be just, and if it be found that any indebtedness
for which a lien is demanded be not then due, the same shall
be allowed for the amount of its present worth.
44-9-40 Judgment, Costs
Judgment shall be given in favor of each lien holder for the
amount demanded and proved by him, with costs and disbursements
to be fixed by the court at the trial, and such amount shall
not be included in the lien of any other party.
44-9-41
Costs
The clerk of the courts shall tax the same costs as are allowed
in foreclosures of real estate mortgages. The lien claimant
shall be entitled to tax as costs, in addition to all other
costs allowed by law, the sum of five dollars for the preparation
of the lien statement and account for filing with the register
of deeds.
44-9-42 Attorney’s and Receiver’s
Fees
The court shall have authority in its discretion to allow
such attorney’s fees and receiver’ s fees and
other expenses as to it may seem warranted and necessary according
to the circumstances of each case, and except as otherwise
specifically provided in this chapter.
44-9-43
Personal Judgment, Subrogation
If, after judgment, a lien holder who is personally indebted
for the amount of any lien so adjudged in favor of another
shall pay such indebtedness, he shall thereby become subrogated
to the rights of the person so paid.
44-9-44
Sale, Proceeds, Distribution Prorata
The judgment shall direct a sale of the real estate or other
property for the satisfaction of all liens charged thereon,
and the manner of such sale, subject to the rights of all
persons which are paramount to such liens or any of them.
It shall require the officer making such sale to pay over
and distribute the proceeds of the sale, after deducting all
lawful charges and expenses, to and among the lienors to the
amount of their respective claims, if there is sufficient
therefore; and if there is not sufficient then to divide and
distribute the same among the several lienors in proportion
to the amount due to each, and without priority among themselves.
44-9-45 Leasehold, Redemption
If the estate sold be a leasehold having not more than two
years to run, or be the interest of a vendee under an executory
contract of sale the conditions whereof are to be performed
within the same period, no redemption shall be allowed; in
all other cases the right of redemption shall be the same
as upon execution sales.
44-9-46 Severance of Building
If, without material injury to the building or other improvement
to which the lien holder has contributed, the same can be
severed and removed from the land, the judgment, in the discretion
of the court, may direct the sale of such improvement, with
the privilege to the purchaser of removing the same at any
time within sixty days, unless before such removal the owner
or other persons interested in the land shall pay to the sheriff,
for the purchaser, the amount realized from the sale, with
interest and all expenses incurred toward such removal.
44-9-47
Confirmation of Sale
No sale shall be deemed complete until reported to and confirmed
by the court.
44-9-48 Resale
If in any case the sale be not confirmed, the court may direct
a resale, or if deemed best may appoint a receiver to lease
or otherwise handle the property under its direction, in the
interests of all persons concerned.
44-9-49
Ordinary Actions
No failure to comply with any of the provisions of this chapter
shall affect the right of any person to recover, in an ordinary
civil action, from the party with whom he has contracted.
CHAPTER 44-9A CONSTRUCTION LIEN WAIVER
AGREEMENTS
44-9A-1 Waivers
Liens for materials, supplies, equipment and services furnished
under construction contracts to contractors or subcontractors
and arising under Title 5 or Title 44 of the South Dakota
Codified Laws or by virtue of the common law of this state
may be expressly waived as provided in this chapter in addition
to all other means presently existing under law by which such
liens may be waived.
44-9A-2
Endorsement of Joint Check and Agreement of Waiver
Any
lien to which a person or corporation furnishing materials,
supplies, equipment and services to a contractor or subcontractor
would otherwise be entitled under Title 5 or Title 44 of the
South Dakota Codified Laws or by virtue of the common law
of this state may be waived to the extent provided in this
chapter by such person or corporation by the endorsement of
a joint check wherein the payees include the contractor or
subcontractor and the person or corporation furnishing materials,
supplies, equipment and services and by the execution of a
separate agreement of waiver between the maker of the joint
check and such person or corporation.
44-9A-3
Joint Check Provisions
A
joint check as used for the purposes provided in this chapter
must have a provision on the reverse side thereof making reference
to a separate written agreement of waiver between the maker
and the person or corporation furnishing materials, supplies,
equipment or services to the contractor or subcontractor.
Such provision must be conspicuous and mention that the payees,
by their endorsements and in consideration of the payment
represented by the joint check, jointly and severally waive
all claims to which they might be entitled under Title 5 and
Title 44 of the South Dakota Codified Laws and the common
law of South Dakota for all materials, supplies, equipment
and service supplied under a clearly identified contract to
the extent of and of the date of the joint check.
44-9A-4
Joint Check Endorsement, Effect
The
endorsement of a joint check as provided herein and the execution
of a separate written agreement of waiver by a person or corporation
furnishing materials, supplies, equipment and services to
an owner, contractor, or a subcontractor shall constitute
an express waiver of all rights and claims under Title 5 and
Title 44 of the South Dakota Codified Laws and the common
law of this state against the owner or contractor and his
surety to the extent of, and as of the date of, the joint
check endorsed.
44-9A-5
Release of Proceeds of Joint Check
It
shall be of no consequence under this chapter if the payment
or any part thereof in such joint check is released to the
contractor or subcontractor by another payee. Release of such
funds is at the peril of the person or corporation furnishing
materials, supplies, equipment and services to the contractor
or subcontractor. |
