Page 45 - State Law Summary of Mechanic's Lien Law

South Dakota SD

What is the statutory authority? What is the period of enforcement of a filed mechanic’s lien?
SDCL § 44-9-1 et seq. A mechanic’s lien must be enforced within 6 years from the date the last item
of the lienholder’s claim was furnished, as listed in the lien statement. If not
What is the Attachment Date of the Mechanic’s Lien? enforced within this time period, the lien becomes unenforceable. SDCL§ 44-9-24.
As against the owner of the land, the mechanic’s lien attaches as of the date
the claimant furnishes the first item of material or labor on the property. Additionally, the property owner, their agent or contractor can serve a written
SDCL § 44-9-7. demand on the lienholder to commence suit to enforce the lien. If the lienholder
does not file suit within 30 days of service, the lien is forfeited. After 40 days, the
As against a bona fide purchaser, mortgagee, or encumbrancer without notice, lien may be canceled by the register of deeds upon filing an affidavit, a copy of
the mechanic’s lien attaches as of the earlier of the actual and visible beginning the demand, and proof of service. SDCL § 44-9-26.
of the improvement on the ground or the date the claimant recorded a notice of
contract. SDCL § 44-9-8. Is there a procedure to bond over the mechanic’s lien(s)?
No.
What constitutes visible commencement of construction?
Furnishing of material or labor on the property. Botsford Lumber Co. v. Schriver, Are the ALTA 32/33 Series Endorsements available for the Loan Policy?
1925, 49 S.D. 68, 206 N.W. 423. Yes.
What is the priority of the insured construction mortgage/
deed of trust?
A mortgage has priority if recorded before all of the following:
i. The visible beginning of construction;

ii. The first item of work or material is furnished to the property;

iii. The claimant records a notice of contract. SDCL §§ 44-9-7 and 44-9-8.
A construction loan that is properly recorded and includes a written provision
that it secures future advances has priority over mechanic’s liens, even if
lender is not obligated to make future advances. SDCL § 44-1-13.

A mechanic’s lien filed after a mortgage does not relate back to a separate,
earlier, unrelated mechanic’s lien. Mechanic’s lien claimants do not
collectively gain priority over a mortgage because one lien predates the
mortgage. SDCL §§ 44-1-4 and 44-9-7.
Also, mechanic’s liens filed subsequent to properly recorded mortgage do not
relate back to separate, unrelated mechanic’s lien which attached before
mortgage so that all mechanic’s lien claimants held collectively superior
position over mortgagee for purposes of receiving sale proceeds. SDCL §§
44-1-4 and 44-9-7. See also In re Swann, 141 B.R. 678 (1992).

If priority of the insured mortgage/deed of trust is lost, is there a
statutory procedure to regain priority?
No.
When does a mechanic’s lien have to be filed for claimant to maintain
lien rights?
A mechanic’s lien will expire unless a statement of claim is filed within 120 days
after the last work is performed or the last item of skill, services, material or
machinery is furnished. SDCL § 44-9-15.

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