South Carolina lien waiver: unenforceable unless the payment substantially equals what you waived
South Carolina's waiver rule is not in the mechanics lien chapter and it is not even the subject of its own section. It is a proviso stapled to the end of a criminal subsection about falsely certifying that everybody has been paid, and it sets a stricter test than most states.
In South Carolina an agreement to waive the right to file or claim a lien for labor and materials is against public policy and unenforceable unless payment substantially equal to the amount waived is actually made.
Read the law: S.C. Code Ann. section 29-7-20(2)scstatehouse.gov
S.C. Code Ann. 29-7-20(2), the provisoFill it in online Type your details in and download it already filled in.Provided, however, that an agreement to waive the right to file or claim a lien for labor and materials is against public policy and is unenforceable unless payment substantially equal to the amount waived is actually made.
Substantially equal to the amount waived. It is not enough that some payment arrived. A waiver for $30,000 taken against a $9,000 check does not meet that test, which is stricter in one direction than the rule in most states.
Download a blank South Carolina lien waiver
South Carolina prescribes no statutory wording, so this is the general conditional waiver on progress payment, the form that fits most draws. Print it and fill it in by hand, or use the builder below and get it back already filled in.
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The sentence the proviso is attached to
Section 29-7-20(2) is a criminal provision. A person who wilfully and intentionally certifies to an owner or a lending institution, by affidavit or otherwise, that everybody who furnished services, labor or materials has been paid in full, when they have not, is guilty of a misdemeanor punishable by a fine of up to five thousand dollars or up to sixty days, or both.
That is aimed at the general contractor who signs a final affidavit that is not true in order to collect the last draw. The waiver proviso then sits at the end of the same subsection, and it carves out services or materials for which lien rights have been waived in writing, provided the payment test is met.
So the two halves work together. The certification has to be true, and a waiver only counts toward making it true if the money behind it was substantially equal to what was given away.
The neighboring section is worth more than the waiver rule
Section 29-7-10 gives every laborer, subcontractor and materialman a first lien on the money the contractor received for that building, in proportion to the amount of their claims, and directs the contractor to pay them out of that money.
That is a claim aimed at the money rather than at the property. It does not depend on recording a lien against the land, it does not run on the same clock, and it survives situations where a lien against the real estate is no longer available.
If you are a South Carolina subcontractor who has been told the lien deadline has passed or that the owner already paid, chapter 29-7 is the chapter to read before you give up. Almost no lien waiver page mentions it.
What to put on the form
The amount, above everything else. South Carolina measures the waiver against the payment actually made, so a form with no figure on its face has nothing to be measured against.
The through date on a progress waiver, so the release stops where the payment stops.
Every open item in the exceptions box. Retainage in particular, because a final waiver that does not except retainage is a waiver for an amount larger than the payment that came with it.
Which of the four to sign on a South Carolina job
The statute protects you from a waiver signed before the work or before the payment. It does not protect you from one worded too broadly, or handed over against a check that later bounces, so the conditional form is still the right default.
Questions people ask
Is a lien waiver signed before payment enforceable in South Carolina?
No. S.C. Code Ann. 29-7-20(2) says an agreement to waive the right to file or claim a lien for labor and materials is against public policy and unenforceable unless payment substantially equal to the amount waived is actually made.
What does substantially equal mean in the South Carolina statute?
The statute does not define it, but the comparison it sets up is between the payment actually made and the amount waived. A partial payment far below the waived figure does not meet the test, which is why the payment amount belongs on the face of every waiver you sign.
Where is South Carolina's lien waiver rule?
In chapter 29-7, Liens of Laborers and Others on Contract Price, not in the mechanics lien chapter at 29-5. It is a proviso at the end of section 29-7-20(2), a criminal subsection about falsely certifying that everyone has been paid.
My South Carolina lien deadline passed. Is there anything left?
Look at S.C. Code Ann. 29-7-10. It gives laborers, subcontractors and materialmen a first lien on the money the contractor received for that building, in proportion to their claims, which is a claim against the money rather than against the property. This is not legal advice and it is worth putting in front of an attorney.
Working in another state? The general lien waiver forms page covers all four waiver types, and conditional vs unconditional lien waiver explains which of the two to sign and when.
This page quotes S.C. Code Ann. section 29-7-20(2) and explains what it says. It is not legal advice, and a statute can be amended. Read the linked section before you rely on it.