Current Status Introducing Body:Senate Bill Number:589 Ratification Number:197 Act Number:141 Primary Sponsor:Courson Type of Legislation:GB Subject:Lien on gas or electric utility Companion Bill Number:3762 Date Bill Passed both Bodies:19930603 Computer Document Number:BBM/10411SD.93 Governor's Action:S Date of Governor's Action:19930614 Introduced Date:19930324 Date of Last Amendment:19930602 Last History Body:------ Last History Date:19930614 Last History Type:Act No. 141 Scope of Legislation:Statewide All Sponsors:Courson Type of Legislation:General Bill
Bill Body Date Action Description CMN Leg Involved
---- ------ ------------ ------------------------------ --- ------------
589 ------ 19930614 Act No. 141
589 ------ 19930614 Signed by Governor
589 ------ 19930610 Ratified R 197
589 Senate 19930603 Concurred in House amendment,
enrolled for ratification
589 House 19930603 Read third time, returned to
Senate with amendment
589 House 19930602 Amended, read second time
589 House 19930601 Recalled from Committee 26
589 House 19930504 Introduced, read first time, 26
referred to Committee
589 Senate 19930430 Read third time, sent to House
589 Senate 19930429 Amended, read second time,
unanimous consent for third
reading on Friday, April 30,
1993
589 Senate 19930428 Committee Report: Favorable 11
with amendment
589 Senate 19930324 Introduced, read first time, 11
referred to Committee
View additional legislative information at the LPITS web site.
(A141, R197, S589)
AN ACT TO AMEND SECTION 29-1-10, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO LIENS ON REAL ESTATE, SO AS TO PROVIDE THAT ANY LIEN ON REAL PROPERTY HELD BY A GAS OR ELECTRICAL UTILITY OR ELECTRIC COOPERATIVE SHALL CONTINUE UNTIL SATISFIED OR RELEASED INSTEAD OF LAPSING TWENTY YEARS AFTER THE MATURITY DATE OF THE LIEN, AND TO REQUIRE A MORTGAGE OR OTHER INSTRUMENT EXECUTED, OR MODIFIED, OR RENDERED AFTER THE EFFECTIVE DATE OF THIS PROVISION TO STATE ON ITS FACE CERTAIN INFORMATION PERTAINING TO THESE PROVISIONS; TO AMEND SECTION 29-3-50, RELATING TO MORTGAGES FOR FUTURE ADVANCES, SO AS TO FURTHER PROVIDE FOR ITS APPLICABILITY TO INDEBTEDNESS OF A GAS OR ELECTRICAL UTILITY OR ELECTRIC COOPERATIVE; TO AMEND THE 1976 CODE BY ADDING SECTION 29-3-80 SO AS TO PROVIDE THAT A MORTGAGE COVERS AFTER-ACQUIRED PROPERTY OF A GAS OR ELECTRICAL UTILITY OR ELECTRIC COOPERATIVE, AND BY ADDING SECTION 29-3-90; SO AS TO ALLOW GENERAL AS OPPOSED TO SPECIFIC DESCRIPTIONS OF REAL PROPERTY IN MORTGAGES GIVEN BY A GAS OR ELECTRICAL UTILITY COMPANY OR ELECTRIC COOPERATIVE.
Be it enacted by the General Assembly of the State of South Carolina:
Duration of mortgages; notice requirements
SECTION 1. Section 29-1-10 of the 1976 Code is amended to read:
"Section 29-1-10. No mortgage or deed having the effect of a mortgage or other lien shall constitute a lien upon any real estate after the lapse of twenty years from the date for the maturity of the lien. However, if the holder of the lien shall, at any time during the continuance of the lien, cause to be recorded upon the record of that mortgage or deed having the effect of a mortgage or other lien a note of some payment on account or some written acknowledgment of the debt secured thereby, with the date of the payment or acknowledgment, the mortgage or deed having the effect of a mortgage or other lien shall be, and shall continue to be, a lien for twenty years from the date of the record of that payment on account or acknowledgment. When there is no maturity stated or fixed in the mortgage or the record of the mortgage, then the provisions hereof are applicable from the date of that mortgage and that mortgage shall not constitute a lien after the lapse of twenty years from the date thereof. Notwithstanding the above provisions of this section, any mortgage or other instrument which by its terms creates a lien upon any real property interest held by a gas or electrical utility or electric cooperative shall continue to constitute a lien thereon until satisfied or released of record regardless of whether or not the instrument states a maturity date.
Any mortgage or other instrument executed or modified of record after the effective date of this paragraph which affects a lien upon any real property interest held by a gas or electrical utility or electric cooperative and is intended to take advantage of the provisions of this section shall state on its face that the lien continues until satisfied or released of record regardless of whether or not the instrument states a maturity date, and shall also state on its face that it is subject to the provisions of this section."
Applicability and effect of mortgages
SECTION 2. Section 29-3-50 of the 1976 Code is amended to read:
"Section 29-3-50. (A) Any mortgage or other instrument conveying an interest in or creating a lien on any real estate, securing existing indebtedness or future advances to be made, regardless of whether the advances are to be made at the option of the lender, are valid from the day and hour when recorded so as to affect the rights of subsequent creditors, whether lien creditors or simple contract creditors, or purchasers for valuable consideration without notice to the same extent as if the advances were made as of the date of the execution of the mortgage or other instrument for the total amount of advances made thereunder, together with all other indebtedness and sums secured thereby, the total amount of existing indebtedness and future advances outstanding at any one time may not exceed the maximum principal amount stated therein, plus interest thereon, attorney's fees and court costs. It is not necessary that the mortgage state as part of the maximum principal the amount of any deferred, accrued, or capitalized interest or discount of any nature or kind, whether the rate of interest or discount is fixed or variable pursuant to an alternative mortgage loan transaction as defined in Section 37-1-301(5), and the lien of the mortgage as to all that interest or discount shall have the same priority as the principal; provided, however, that the recorded mortgage discloses that interest or discount will be deferred, accrued, or capitalized. However, the lien of a person who has furnished labor, services, or material in connection with the construction of improvements to real property is superior to the lien of a recorded mortgage as to disbursements made after filing of the notice of the mechanic's lien required by Section 29-5-90 and service of the notice on all prior recorded mortgage holders. Service of the notice on prior recorded mortgage holders must be made pursuant to Rule 4 of the South Carolina Rules of Civil Procedure. The priority of the mechanic's lien extends only to the mortgage disbursements made after the filing of the lien and service of the notice on all prior recorded mortgage holders.
(B) Any mortgage or other instrument which by its terms creates an interest in or a lien upon any real property interest held by a gas or electrical utility or electric cooperative, securing existing indebtedness or indebtedness to be incurred in the future, is valid from the day and hour when recorded. It affects and is prior to the rights of all creditors and purchasers for valuable consideration without notice and all liens except liens of record prior to recordation of the mortgage, regardless of whether there is an actual debt outstanding at the time of recordation of the mortgage, to the same extent as if the future indebtedness were incurred as of the date of the execution of the mortgage or other instrument for the total amount of indebtedness thereafter incurred, together with all other indebtedness and sums secured thereby. However, the total amount of existing indebtedness and future indebtedness at any one time may not exceed the maximum principal amount stated therein plus interest thereon, attorney's fees and court costs, and the mortgage or other instrument must contemplate that future indebtedness may be incurred. The mortgage or other instrument shall remain a valid lien and effective as record notice thereof until satisfied or released of record even though there are periods during which no indebtedness is outstanding thereunder.
Notwithstanding the above provisions, the lien of a person who has furnished labor, services, or materials in connection with the construction of improvements to real property is superior to the lien of a recorded mortgage as to indebtedness actually incurred after filing of the notice of the mechanic's lien required by Section 29-3-90 and service of the notice on all prior recorded mortgage holders. Service of the notice on prior recorded mortgage holders must be made pursuant to Rule 4 of the South Carolina Rules of Civil Procedure. The priority of the mechanic's lien extends only to the mortgage indebtedness actually incurred after the filing of the lien and service of the notice on all prior recorded mortgage holders."
Coverage of mortgages
SECTION 3. The 1976 Code is amended by adding:
"Section 29-3-80. Any mortgage or other instrument executed by a gas or electrical utility or electric cooperative transacting business in this State which by its terms creates a lien upon any real property interest then owned or thereafter acquired and which is recorded as a mortgage of real property in any county in which the property is located or is to be located shall have the same force and effect as if the mortgage or other instrument were also recorded or filed in the proper office in the county as a mortgage of personal property. Recordation of the mortgage or other instrument shall cause the lien thereof to attach to all after-acquired property of the mortgagor of the nature therein described immediately upon the acquisition thereof by mortgagor and the lien is superior to all claims of creditors of the mortgagor and purchasers of these real property interests, except prior liens of record, affecting the property. The gas or electrical utility or electric cooperative shall file a notice in every county in which the utility intends to claim the benefit of this provision of law and referencing the book and page number of the mortgage or other instrument which is entitled to the benefit of this provision of law. Thereafter, there shall be no further document necessary to create or give notice of the lien upon the real property interest thereafter acquired by the gas or electrical utility or electric cooperative."
Descriptions in mortgages
SECTION 4. The 1976 Code is amended by adding:
"Section 29-3-90. (A) Any real property or real property interests, including, without limitation, easements and rights-of-way, of any gas or electrical utility or electric cooperative which are intended to be subjected to the lien of any mortgage, indenture, or other type of real property security agreement, may be described in general terms and are operative and effective without the necessity of description of metes and bounds, references to plats, or other methods of description as commonly utilized in mortgages of this State. Without limiting or excluding other types of general descriptions which may be utilized for these purposes, it is sufficient if the property or property interests are described in the following words or their substantial equivalent:
All real property and real property interests of , including, without limitation, lands, buildings, fixtures, easements, rights-of-way, leaseholds, and other interests, situate, lying, and being in any one or more of the counties of the State of South Carolina, as the same may be now or hereafter constituted or delineated, and whether now owned or acquired hereafter while the lien of this mortgage remains open and unsatisfied of record, SAVING, EXCEPTING, AND EXCLUDING THEREFROM THE FOLLOWING: .
(B) The provisions of Section 30-5-35 relating to derivation clauses in deeds and mortgages do not apply to mortgages granted by gas or electrical utilities or electric cooperatives.
(C) Without limiting the foregoing, it is also sufficient and effective to subject real property and real property interests of any gas or electrical utility or electric cooperative to the lien of any prior mortgage, indenture, or other similar real property security agreement executed by the utility by reference to the prior mortgage or other instrument and the inclusion of words in the deed or conveyance to the effect that the real property or real property interests will be upon acquisition by the grantee immediately and automatically subjected to the lien of the prior mortgage or other instrument.
(D) Without limiting the effect of subsections (A), (B), and (C) above, it is also operative and effective to describe the real property or real property interests of any gas or electrical utility or electric cooperative being subjected to the lien of a mortgage, indenture, or other real property security agreement by referencing the property description or descriptions contained in any prior mortgage or other real property financing agreement executed by the utility, even though that prior mortgage or other instrument may be satisfied of record and notwithstanding the fact that the prior mortgage or other instrument encumbers real property or real property interests which have been subjected thereto by reference to a description contained in another instrument."
Cumulative effect
SECTION 5. The provisions provided for gas or electrical utilities or electric cooperatives in Sections 29-1-10, 29-3-50(B), 29-3-80, and 29-3-90 of this act shall be construed as cumulative authority and shall not be construed to impliedly repeal any existing laws affecting mortgages and liens of gas or electrical utilities or electric cooperatives.
Time effective
SECTION 6. This act takes effect upon approval by the Governor.
Approved the 14th day of June, 1993.