§ 29-1-501 — Substitute security to satisfy lien; filing and effect thereof; action upon security

(a) Any lien created pursuant to this act filed against
any real or personal property is satisfied if the owner of the
property, contractor or subcontractor has deposited with the
court having jurisdiction over the lien claim a corporate surety
bond, letter of credit, cash or cash equivalent of established
value approved by the court having jurisdiction over the lien
claim in the county where the lien was filed in an amount equal
to one and one-half (1½) times the amount of the lien.
(b) The security shall guarantee that if the lien claimant
is finally adjudged to be entitled to recover upon the lien, the
principal or his sureties, jointly and severally, in the case of
a bond, or the issuer of a letter of credit shall pay the lien
claimant the amount of the judgment for at least the amount for
which the lien was filed plus costs and attorneys' fees.
(c) The security may be deposited any time prior to entry
of a final judgment in an action to foreclose the lien.
(d) The security shall be deposited with the clerk of the
court having jurisdiction over the lien claim in the county
where the lien was filed.
(e) Upon depositing the security and entry of an order of
the court accepting the security, the lien against the property
shall be forthwith discharged and released in full, and the
security deposited pursuant to this section shall be
substituted. The clerk of court shall issue a notice of
satisfaction of lien which the owner or lien claimant may file
in the office of the county clerk where the lien was filed which
shall show that the lien has been satisfied.
(f) A lien claimant whose lien has been satisfied by the
substitution of the security pursuant to subsection (e) of this
section may bring an action upon the security. The action shall
be commenced in the court in which the security was deposited
under subsection (d) of this section.