S*233 Session 108 (1989-1990)
S*0233(Rat #0497, Act #0426 of 1990) General Bill, By Leventis and Leatherman
A Bill to amend Title 29, Code of Laws of South Carolina, 1976, relating to
mortgages and other liens, by adding Chapter 6 so as to provide for timely
payments to contractors, subcontractors, and suppliers, to provide for
interest on late payments, and to provide exceptions.-amended title
01/24/89 Senate Introduced and read first time SJ-5
01/24/89 Senate Referred to Committee on Banking and Insurance
03/23/89 Senate Committee report: Favorable with amendment
Banking and Insurance SJ-8
03/28/89 Senate Amended SJ-11
03/28/89 Senate Read second time SJ-12
03/28/89 Senate Ordered to third reading with notice of
amendments SJ-12
03/30/89 Senate Amended SJ-15
03/30/89 Senate Read third time and sent to House SJ-15
04/04/89 House Introduced and read first time HJ-17
04/04/89 House Referred to Committee on Judiciary HJ-18
01/18/90 House Committee report: Favorable with amendment
Judiciary HJ-7
01/25/90 House Debate adjourned until Tuesday, January 30, 1990 HJ-14
01/30/90 House Amended HJ-31
01/30/90 House Read second time HJ-33
01/31/90 House Reconsider vote whereby read second time HJ-14
01/31/90 House Debate adjourned until Tuesday, February 6, 1990 HJ-15
02/06/90 House Debate adjourned until Wednesday, February 7,
1990 HJ-57
02/07/90 House Debate adjourned until Tuesday, February 13, 1990 HJ-20
02/13/90 House Debate adjourned until Wednesday, February 14,
1990 HJ-14
02/15/90 House Debate adjourned until Tuesday, February 20, 1990 HJ-19
02/20/90 House Debate adjourned until Wednesday, February 21,
1990 HJ-23
02/21/90 House Amended HJ-30
02/21/90 House Debate adjourned until Thursday, February 22,
1990 HJ-31
02/22/90 House Amended HJ-10
02/22/90 House Read second time HJ-10
02/27/90 House Read third time and returned to Senate with
amendments HJ-12
03/01/90 Senate House amendment amended SJ-8
03/01/90 Senate Returned to House with amendments SJ-8
03/07/90 House Non-concurrence in Senate amendment HJ-66
03/08/90 Senate Senate insists upon amendment and conference
committee appointed Sens. Leatherman, Leventis,
Setzler SJ-2
03/12/90 House Conference committee appointed MD Burriss, Short
& J. Williams HJ-3
04/11/90 Senate Conference report received and adopted SJ-13
04/12/90 House Conference report received and adopted HJ-194
04/12/90 House Ordered enrolled for ratification HJ-198
04/19/90 Ratified R 497
04/24/90 Signed By Governor
04/24/90 Effective date 04/24/90
04/24/90 Act No. 426
05/14/90 Copies available
(A426, R497, S233)
AN ACT TO AMEND TITLE 29, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING
TO MORTGAGES AND OTHER LIENS, BY ADDING CHAPTER 6 SO AS TO PROVIDE FOR
TIMELY PAYMENTS TO CONTRACTORS, SUBCONTRACTORS, AND SUPPLIERS, TO PROVIDE
FOR INTEREST ON LATE PAYMENTS, AND TO PROVIDE EXCEPTIONS.
Be it enacted by the General Assembly of the State of South Carolina:
Contractors, subcontractors, and suppliers; timely payment required
SECTION 1. Title 29 of the 1976 Code is amended by adding:
"CHAPTER 6
Payments to
Contractors, Subcontractors, and Suppliers
Section 29-6-10. Unless the context otherwise requires in this
chapter:
(1) 'Contractor' means a person who contracts with an owner to
improve real property or perform construction services for an owner.
(2) 'Improve' means to build, effect, alter, repair, or demolish
any improvement upon, connected with, or on or beneath the surface of any
real property, or to excavate, clear, grade, fill, or landscape any real
property, or to construct driveways and roadways, or to furnish
materials, including trees and shrubbery, for any of these purposes, or
to perform any labor upon these improvements, and also means and includes
any design or other professional or skilled services furnished by
architects, engineers, land surveyors, and landscape architects.
(3) 'Improvement' means all or any part of any building,
structure, erection, alteration, demolition, excavation, clearing,
grading, filling, or landscaping, including trees and shrubbery,
driveways, and roadways on real property.
(4) 'Owner' means a person who has an interest in the real
property improved and for whom an improvement is made and who ordered the
improvement to be made. 'Owner' includes any state, local, or municipal
government agencies, instrumentalities, or entities.
(5) 'Real property' means the real estate that is improved,
including lands, leaseholds, tenements, and hereditaments, and
improvements placed on the real property.
(6) 'Subcontractor' means any person who has contracted to furnish
labor or materials to, or has performed labor or supplied materials for,
a contractor or another subcontractor in connection with a contract to
improve real property.
Section 29-6-20. Performance by a contractor or subcontractor in
accordance with the provisions of his contract entitles him to payment
from the party with whom he contracts.
Section 29-6-30. When a contractor or a subcontractor has performed
in accordance with the provisions of his contract, the owner shall pay
the contractor by mailing via first class mail or delivering the
undisputed amount of any pay request within twenty-one days of receipt
by the owner of any pay request based upon work completed or service
provided under the contract, and the contractor shall pay to his
subcontractor and each subcontractor shall pay to his subcontractor,
within seven days of receipt by the contractor or subcontractor of each
periodic or final payment, by mailing via first class mail or delivering
the full amount received for that subcontractor's work and materials
based on work completed or service provided under the subcontract.
Section 29-6-40. Nothing in this chapter prevents the owner,
the contractor, or a subcontractor from withholding application and
certification for payment because of the following: unsatisfactory job
progress, defective construction not remedied, disputed work, third party
claims filed or reasonable evidence that claim will be filed, failure of
contractor or subcontractor to make timely payments for labor, equipment,
and materials, damage to owner, contractor, or another subcontractor,
reasonable evidence that contract or subcontract cannot be completed for
the unpaid balance of the contract or subcontract sum, or a reasonable
amount for retainage.
Nothing in this chapter requires that payments due a contractor from
an owner be paid any more frequently than as set forth in the
construction documents, nor shall anything in this chapter affect the
terms of any agreement between the owner and any lender.
Section 29-6-50. If a periodic or final payment to a contractor
is delayed by more than twenty-one days or if a periodic or final payment
to a subcontractor is delayed by more than seven days after receipt of
periodic or final payment by the contractor or subcontractor, the owner,
contractor, or subcontractor shall pay his contractor or subcontractor
interest, beginning on the due date, at the rate of one percent a month
or a pro rata fraction thereof on the unpaid balance as may be due.
However, no interest is due unless the person being charged interest has
been notified of the provisions of this section at the time request for
payment is made. Nothing in this chapter shall prohibit owners,
contractors, and subcontractors, on private construction projects only,
from agreeing by contract to rates of interest and payment periods
different from those stipulated in this section, and in this event, these
contractual provisions shall control, provided the requirements of
Section 29-6-30 and this section are specifically waived, by section
number, in conspicuous bold-faced or underlined type. In case of a
wilful breach of the contract provisions as to time of payment, the
interest rate specified in this section shall apply.
Section 29-6-60. The provisions of this chapter do not apply
to:
(1) residential homebuilders;
(2) improvements to real property intended for residential
purposes which consist of sixteen or fewer residential units; or
(3) private persons or entities owning improvements to real
property when the specific improvements are not financed by a
nonowner."
Time effective
SECTION 2. This act takes effect upon approval by the Governor.
Approved the 24th day of April, 1990.
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