South Carolina Notice of Furnishing Labor or Materials

Introduction

Key Things to Know

1. 1

   South Carolina calls this a notice of furnishing labor or materials, and Section 29-5-20(B) uses it to lift a cap rather than to unlock a lien. Without it, a sub-subcontractor or supplier cannot lien for more than the contractor still owes the subcontractor it supplied.

2. 2

   Once the contractor has received it, the section says no payment by the contractor to the subcontractor will lessen the amount recoverable by the person giving notice. That protection is prospective, so what the notice saves depends on how much of the subcontract was still unpaid on the day it landed.

3. 3

   There is no day count in Section 29-5-20(B). The section attaches no deadline, which is unusual and is not the same as having unlimited time, because every dollar the contractor pays the subcontractor before your notice arrives is a dollar outside your cap.

4. 4

   Certified or registered mail to the contractor are the two methods the section names. Keep the delivery record rather than only the mailing slip, since the statute measures from receipt.

5. 5

   Six items are mandatory under Section 29-5-20(B): your name; the name of the person you contracted with or who employed you; a description of the labor, services or materials and the contract price or value, with specially fabricated materials broken out separately; a project description sufficient for identification; the dates of the first and last item furnished or scheduled; and the amount claimed to be due, if any.

6. 6

   The cap only exists where a notice of project commencement was filed. Section 29-5-23 says failure to file one renders Sections 29-5-20(B) and 29-5-60(B) inapplicable, and it requires a location notice posted at the job site whose wording the statute dictates.

7. 7

   Section 29-5-20(D) exempts individual laborers whose lien is less than two thousand dollars from subsection (B) altogether, so a small individual labor claim is not capped for want of a notice.

South Carolina Requirements for Preliminary Notice

• Certified or Registered Mail to the Contractor

  Section 29-5-20(B) requires the notice of furnishing labor or materials to be provided by certified or registered mail to the contractor. Those are the only two methods the section names. On the payment bond track, Section 29-5-440 adds the permitted addresses: any place the bonded contractor maintains a permanent office for the conduct of its business, or the current address shown on the records of the Department of Labor, Licensing and Regulation.

• Sub-Subcontractors and Suppliers to Subcontractors Send It

  Section 29-5-20(B) is written around a sub-subcontractor or supplier, meaning a party that supplied labor, material or services to a subcontractor rather than to the contractor. Section 29-5-20(D) exempts individual laborers when the amount of their lien is less than two thousand dollars. On the bond side, Section 29-5-440 defines a remote claimant as a person in direct contractual relationship with a subcontractor or supplier of a bonded contractor but with no contractual relationship with the bonded contractor.

• No Day Count, but the Protection Starts Only on Receipt

  Section 29-5-20(B) attaches no number of days to this notice. What it does provide is that after receiving such notice, no payment by the contractor to the subcontractor will lessen the amount recoverable by the person so giving notice. Everything the contractor paid that subcontractor before your notice arrived sits outside your cap, so the practical rule is to send it at the start of the job rather than when an invoice ages.

• Six Content Items, With Specially Fabricated Materials Broken Out

  Section 29-5-20(B) requires the claimant name; the name of the person contracted with or by whom the claimant was employed; a description of the labor, services or materials and the contract price or value, with materials specially fabricated by a person other than the one giving notice and their contract price or value stated separately; a project description sufficient for identification; the date the first and the last item was actually furnished or scheduled to be furnished; and the amount claimed to be due, if any.

• Without the Notice, the Claim Is Capped at What the Subcontractor Is Owed

  Section 29-5-20(B) provides that in no event shall the aggregate amount of any liens filed by a sub-subcontractor or supplier exceed the amount due by the contractor to the subcontractor to whom that party supplied, unless the notice has been provided. The same subsection keeps an outer ceiling in every case: the total aggregate amount of liens on the improvement cannot exceed the amount due by the owner. Section 29-5-60(B) requires the contractor to prorate all just liens among sub-subcontractors and suppliers to a subcontractor where the amount due that subcontractor is insufficient.

• No Notice of Project Commencement, No Cap to Lift

  Section 29-5-23 lets any person entering into a direct agreement with, or with the consent of, an owner file a notice of project commencement with the clerk of court or register of deeds within fifteen days of the commencement of work, with a fifteen dollar filing fee, and it requires a location notice posted at the job site whose wording the statute dictates. The section then provides that the failure to file a notice of project commencement shall render the provisions of Sections 29-5-20(B) and 29-5-60(B) inapplicable.

• The Separate Written Notice to the Owner Under Section 29-5-40

  Where work is done or material furnished on the employment of a contractor or some other person than the owner, Section 29-5-40 makes the Section 29-5-20 lien attach against the true owner once the laborer, mechanic, contractor or materialman notifies the owner in writing of the furnishing of the labor or material and the amount or value of it. The same section caps the aggregate of liens it creates at the amount due by the owner on the contract price of the improvement. This is a second document and the contractor notice does not substitute for it.

• Equipment Rental, Security Guards and Debris Disposal Are Inside the Regime

  Section 29-5-22 treats a supplier of tools, appliances, machinery or equipment as having furnished material within the meaning of Sections 29-5-20 and 29-5-40, to the extent of the reasonable rental value for the period of actual use. Section 29-5-25 deems a provider of private security guard services at the site during the improvement a laborer within those sections, and Section 29-5-27 does the same for a provider of construction and demolition debris disposal services as defined in Section 44-96-40(6). Each therefore faces the same notice question as a trade subcontractor.