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Lien lapse in South Dakota, for failure to enforce within 30 days?!

Contractor's attorney disputes validity of our Lien stating "it has lapsed due to your failure to enforce it. Under SDCL §5-22-8, a lien may be discharged for 'lapse of the time within which an action to enforce the same may be commenced without such action having been commenced.' SDCL 5-22-7 provides that: All claims to liens under this chapter relating to public improvement contracts shall cease to have any validity or to be binding upon the public body or the contractor under the provisions of this chapter unless an action to enforce the same as hereinbefore provided shall be commenced within thirty days from the acceptance of the work for which the same shall be claimed. ...As of today’s date, A Thru Z has not taken further action to enforce its lien...because A Thru Z has not taken any action to enforce its Public Claim of Lien within thirty (30) days of acceptance of A Thru Z’s work, its Public Claim of Lien has ceased to have any validity under SDCL 5-22-7 and 5-22-8." 1. Is this correct? 2. If so, we were not aware of this requirement to maintain/effectuate the Lien. I would expect that zLien should have advised us accordingly at the time we issued it. Did they and we missed it??

1 reply

Dec 14, 2018

I'm sorry to hear about that. First, it's worth noting that a property owner or other payor's first reaction to a lien filing is typically to challenge that lien. We discuss the idea in depth here: My Lien Was Challenged — What Do I Do?. As discussed in the article - a challenge against a lien does not necessarily indicate that there's an issue with the lien filing. That being said, zlien has noted the potential for the South Dakota lien enforcement period to be shortened to 30 days in several areas on its website, including: (1) in the South Dakota Lien and Notice FAQs (under "When is the Deadline to Enforce a South Dakota Mechanics Lien, or, How Long is My Lien Effective?"); and (2) 3 Important Nuances Within South Dakota Mechanics Lien Law. under § 44-9-26 of the South Dakota lien statute, an owner, an owner's agent, or a contractor can shorten the timeframe during which a South Dakota lien is effective by sending a written demand to the lien claimant. However, such a notice will only be effective to shorten the timeframe to lien if the written demand was served on the lien claimant and the party attempting to shorten the timeframe has provided proof that such a notice was sent to the party who held the lien. In the event that the notice was not properly sent to the lien claimant and/or that the party attempting to shorten the timeframe for lien has no proof that the lien holder was properly served, the time to enforce a filed South Dakota mechanics lien will not be shortened. Of course, it might be up to the lien claimant to dispute that the lien period should not be shortened - and that could take some sort of further legal action, such as a motion with the relevant court to dispute the issue. Finally, it's worth noting that while zlien provides a substantial amount of legal information regarding the lien laws across all 50 states, zlien is unable legally advise any user.

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