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RECALLED
May 20, 1999
S. 565
S. Printed 5/20/99--S.
Read the first time March 4, 1999.
TO AMEND CHAPTER 5, TITLE 29, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO MECHANICS' LIENS, BY ADDING SECTION 29-5-440 SO AS TO PROVIDE FOR THE RIGHT TO SUE ON A PAYMENT BOND, UNDER CERTAIN CONDITIONS AND CIRCUMSTANCES, FOR THE AMOUNT, OR BALANCE, UNPAID AT THE TIME OF INSTITUTING THE SUIT AND TO PROSECUTE THE ACTION TO FINAL EXECUTION AND JUDGMENT FOR THE SUM OR SUMS JUSTLY DUE; TO AMEND SECTION 11-35-3030, AS AMENDED, RELATING TO THE PROVISIONS FOR BOND AND SECURITY AND CONSTRUCTION SERVICES UNDER THE SOUTH CAROLINA CONSOLIDATED PROCUREMENT CODE, SO AS TO DELETE CERTAIN PROVISIONS RELATIVE TO THE RIGHT TO INSTITUTE SUITS ON PAYMENT BONDS, AND TO ADD PROVISIONS FOR, AMONG OTHER THINGS, THE REQUIRED GIVING OF TWO WRITTEN NOTICES; TO AMEND SECTION 57-5-1660, AS AMENDED, RELATING TO THE STATE HIGHWAY SYSTEM, CONSTRUCTION CONTRACTS AND PURCHASES, AND AMOUNTS OF AND ACTIONS ON CONTRACTORS' BONDS, SO AS TO DELETE CERTAIN PROVISIONS, AND TO ADD PROVISIONS FOR, AMONG OTHER THINGS, THE REQUIRED GIVING OF TWO WRITTEN NOTICES; AND TO AMEND THE 1976 CODE BY ADDING SECTION 11-1-120 SO AS TO PROVIDE FOR THE PROVISIONS APPLICABLE TO THE INSTITUTION OF A SUIT WHEN THE STATE OR A COUNTY, A MUNICIPALITY, OR A POLITICAL SUBDIVISION OF THE STATE, A COUNTY, OR A MUNICIPALITY CONTRACTS FOR CONSTRUCTION AND REQUIRES THE PERSON OR ENTITY PERFORMING THE WORK TO FURNISH A PAYMENT BOND, NOT GOVERNED BY CERTAIN OTHER PROVISIONS OF LAW, IN THE FULL AMOUNT OF THE CONTRACT FOR THE PROTECTION OF PERSONS WHO FURNISH LABOR OR MATERIAL TO THE CONTRACTOR OR HIS SUBCONTRACTORS FOR THE WORK SPECIFIED IN THE CONTRACT.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 5 of Title 29 of the 1976 Code is amended by adding:
"Section 29-5-440. Every person who has furnished labor or material to a contractor or his subcontractors in the prosecution of work provided for in any contract for construction, in respect of which a payment bond has been furnished and who has not been paid in full therefor before the expiration of a period of ninety days after the day on which the last of the labor was done or performed by him or material was furnished or supplied by him for which a claim is made, shall have the right to sue on the payment bond for the amount, or the balance thereof, unpaid at the time of the institution of the suit and to prosecute the action to final execution and judgment for the sum or sums justly due him; provided, however, that any person having a direct contractual relationship with a subcontractor of the contractor furnishing the bond but no contractual relationship expressed or implied with the contractor furnishing the bond shall have a right of action upon the bond only upon (1) giving written notice by certified or registered mail to the contractor furnishing the bond within forty-five days after beginning to furnish labor, materials, or supplies for the prosecution of the work that such person has provided labor or materials, and (2) giving written notice by certified or registered mail to the contractor furnishing the bond within ninety days from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material for which claim is made, stating with substantial accuracy the amount claimed as unpaid and the name of the party to whom material was furnished or supplied or for whom labor was done or performed. No action for the labor, materials, or supplies may be instituted against the contractor furnishing the bond or its surety unless both notices have been given. No suit under this section shall be commenced after the expiration of one year after the last date of furnishing or providing labor, services or materials."
SECTION 2. Section 11-35-3030(2)(c) of the 1976 Code is amended to read:
"(c) Suits on Payment Bonds-Right to Institute. Every person who has furnished labor or material to the contractor or its his subcontractors for the work specified in the contract, in respect of which a payment bond is furnished under this section, and who has not been paid in full therefor before the expiration of a period of ninety days after the day on which the last of the labor was done or performed by such person or material was furnished or supplied by such person for which such claim is made, shall have the right to sue on the payment bond for the amount, or the balance thereof, unpaid at the time of institution of such suit and to prosecute such action for the sum or sums justly due such person. Any person having a direct contractual relationship with a subcontractor of the contractor furnishing the bond, but no contractual relationship expressed or implied with the contractor furnishing such payment bond, shall have a right of action on the payment bond only upon (1) giving written notice by certified or registered mail to the contractor within ninety forty-five days from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material upon which such claim is made, after beginning to furnish labor, materials, or supplies for the prosecution of the work for which such person has provided labor or materials and (2) giving written notice by certified or registered mail to the contractor within ninety days from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material upon which such claim is made, stating with substantial accuracy the amount claimed as unpaid and the name of the party to whom the material was furnished or supplied or for whom the labor was done or performed. Such written notice to the contractor shall be personally served or served by mailing the same by registered or certified mail, postage prepaid, in an envelope addressed to the contractor at any place the contractor maintains an office or conducts its business. No action for the labor, materials, or supplies may be instituted against the contractor or the surety unless both notices have been given. No suit under this section shall be commenced after the expiration of one year after the last date of furnishing or providing labor, services, or materials."
SECTION 3. Section 57-5-1660(b) of the 1976 Code is amended to read:
"(b) Every person who has furnished labor or material in the prosecution of the work provided for in such contract, in respect of which such a bond has been furnished under this section and who has not been paid in full therefor before the expiration of a period of ninety days after the day on which the last of the labor was done or performed by him or material was furnished or supplied by him for which such claim is made, shall have the right to sue on such bond for the amount, or the balance thereof, unpaid at the time of the institution of such suit and to prosecute such action to final execution and judgment for the sum or sums justly due him; provided, however, that any person having direct contractual relationship with a sub-contractor providing labor or materials in the prosecution of the work but having no contractual relationship expressed or implied with the contractor furnishing the bond shall have a right of action upon the bond only upon (1) giving written notice by certified or registered mail to the contractor within ninety forty-five days from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material for which claim is made, stating with substantial accuracy the amount claimed and the name of the party to whom material was furnished or supplied or for whom labor was done or performed. after beginning to furnish labor, materials, or supplies for the prosecution of the work for which such person has provided labor or materials and (2) giving written notice by certified or registered mail to the contractor within ninety days from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material for which claim is made, stating with substantial accuracy the amount claimed as unpaid and the name of the party to whom material was furnished or supplied or for whom labor was done or performed. No action for the labor, materials, or supplies may be instituted against the contractor or the surety unless both notices have been given. No suit under this section shall be commenced after the expiration of one year after the date of the final settlement of the contract."
SECTION 4. Chapter 1 of Title 11 of the 1976 Code is amended by adding:
"Section 11-1-120. (A) When the State or a county, a municipality, or a political subdivision of the State, a county, or a municipality contracts for construction and requires the person or entity performing the work to furnish a payment bond not governed by Section 11-35-3030(2)(c) or Section 57-5-1660(b) in the full amount of the contract for the protection of persons who furnish labor or material to the contractor or his subcontractors for the work specified in the contract, the provisions of subsection (B) of this section shall apply.
(B) Every person who has furnished labor or material to the contractor or his subcontractors in the prosecution of the work provided for in such contract, in respect or which such a bond has been furnished under this section and who has not been paid in full therefor before the expiration of a period of ninety days after the day on which the last of the labor was done or performed by him or material was furnished or supplied by him for which such claim is made, shall have the right to sue on such bond for the amount, or the balance thereof, unpaid at the time of the institution of such suit and to prosecute such action to final execution and judgment for the sum or sums justly due him; provided, however, that any person having a direct contractual relationship with a subcontractor of the contractor furnishing the bond but no contractual relationship expressed or implied with the contractor furnishing the bond shall have a right of action upon the bond only upon (1) giving written notice by certified or registered mail to the contractor within forty-five days after beginning to furnish labor, materials or supplies for the prosecution of the work for which such person has provided labor or materials an (2) giving written notice by certified or registered mail to the contractor within ninety days from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material for which claim is made, stating with substantial accuracy the amount claimed as unpaid and the name of the party to whom material was furnished or supplied or for whom labor was done or performed. No action for the labor, materials, or supplies may be instituted against the contractor or the surety unless both notices have been given. No suit under this section shall be commenced after the expiration of one year after the last date of providing or furnishing labor, materials or services."
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