§ 29-3-100 — Validity of certain assignments of rents, issues, or profits.

South Carolina § 29-3-100

• Jurisdiction: South Carolina
• Title 29: MORTGAGES AND OTHER LIENS
• Ch. 3: MORTGAGES AND DEEDS OF TRUST GENERALLY

Text

(A) For purposes of this section the following definitions apply: (1) "Rents, issues, or profits" means all amounts payable by or on behalf of any lessee, tenant, or other person having a possessory interest in real property on account of or pursuant to any written or oral lease or other instrument evidencing a possessory interest in real property or pursuant to any form of tenancy implied by law, and all amounts payable by or on behalf of any licensee or permittee or other person occupying or using real property under license or permission from the owner or person entitled to possession. The term shall not include farm products, timber, the proceeds from the sale of farm products or timber, or the proceeds from the recovery or severance of any mineral deposits located on or under real property. (2) "Assignment of leases, rents, issues, or profits" means every document assigning, transferring, pledging, mortgaging, or conveying an interest in leases, licenses to real property, and rents, issues, or profits arising from real property, whether set forth in a separate instrument or contained in a mortgage, conditional sales contract, or other deed or instrument of conveyance. (3) "Collateral assignment" means any assignment of leases, rents, issues, or profits made and delivered in connection with the grant of any mortgage, or the execution of any conditional sales contract or in connection with any extension of credit made against the security of any interest in real property, where the assignor retains the right to collect or to apply the lease revenues, rents, issues, or profits after assignment and prior to default. (B) The recording of a written document containing an assignment of leases, rents, issues, or profits arising from real property is valid and enforceable from the time of recording to pass the interest granted, pledged assigned, or transferred as against the assignor, and is perfected from the time of recording against subsequent assignees, lien creditors, and purchasers for a valuable consideration from the assignor. (C) Where an assignment of leases, rents, issues, or profits is a collateral assignment, after a default under the mortgage, conditional sales contract, or evidence of indebtedness which the assignment secures, the assignee is thereafter entitled, but not required, to collect and receive any accrued and unpaid or subsequently accruing lease revenues, rents, issues, or profits subject to the assignment, without need for the appointment of a receiver, any act to take possession of the property, or any further demand on the assignor. Unless otherwise agreed, after default the assignee is entitled to notify the tenant or other obligor to make payment to him and is also entitled to take control of any proceeds to which he may be entitled. The assignee must proceed in a commercially reasonable manner and may deduct his reasonable expenses of realization from the collections. (D) This section shall not exclude other methods of creating, perfecting, collecting, sequestering, or enforcing a security interest in rents, issues, or profits provided by the law of this State.

Legislative History

HISTORY: 1993 Act No. 66, SECTION 1. ARTICLE 5 Satisfaction and Release