Section 18-44-118 - Filing of bond in contest of lien(a)(1) In the event any person claiming a lien for labor or materials upon any property shall file such a lien within the time and in the manner required by law with the circuit clerk or other officer provided by law for the filing of such a lien, and if the owner of the property, any mortgagee or other person having an interest in the property, or any contractor, subcontractor, or other person liable for the payment of such a lien shall desire to contest the lien, then the person so desiring to contest the lien may file: (A) With the circuit clerk or other officer with whom the lien is filed as required by law a bond with surety, to be approved by the officer in the amount of the lien claimed; or(B) An action under subsection (f) of this section to protest the filing of the lien.(2) The bond shall be conditioned for the payment of the amount of the lien, or so much of the lien as may be established by suit, together with interest and the costs of the action, if upon trial it shall be found that the property was subject to the lien.(b)(1)(A) Upon the filing of the bond, if the circuit clerk or other officer before whom it is filed approves the surety, he or she shall give to the person claiming the lien, at his or her last known address, three (3) days' notice of the filing of the bond.(B) The notice shall be in writing and served by any:(i) Officer authorized by law to serve process in a civil action; or(ii) Form of mail addressed to the person to be served with a return receipt requested and delivery restricted to the addressee or the agent of the addressee.(2)(A) Within the three (3) days' notice, the person claiming the lien may appear and question the sufficiency of the surety or form of the bond.(B) At the expiration of three (3) days, if the person claiming the lien shall not have questioned the sufficiency of the bond or surety or if the circuit clerk finds the bond to be sufficient, the circuit clerk shall note the filing of the bond upon the margin of the lien record and the lien shall then be discharged and the claimant shall have recourse only against the principal and surety upon the bond.(c)(1) If no action to enforce the lien shall be filed within the time prescribed by law for the enforcement of a lien against the surety, the bond shall be null and void.(2) However, if any action shall be timely commenced, the surety shall be liable in like manner as the principal.(d) If the circuit clerk shall determine that the bond tendered is insufficient, the person tendering the bond shall have twenty-four (24) hours within which to tender a sufficient bond, and unless a sufficient bond shall be so tendered, the lien shall remain in full force and effect.(e)(1) Any party aggrieved by the acceptance or rejection of the bond may apply to any court of competent jurisdiction by an action which is appropriate.(2) Upon notice as required by law, the court shall have jurisdiction to enter an interlocutory order as may be necessary for the protection of the parties by:(A) Requiring additional security for the bond;(B) Reinstating the lien in default of the bond, pending trial and hearing; or(C) Requiring acceptance of the bond as may be necessary for the protection of the parties.(f)(1) A protest under subdivision (a)(1)(B) of this section shall be filed as a civil action in the circuit court of the county where the lien is filed.(2) The issues in the action shall be limited to whether:(A) The lien was filed in the form required by § 18-44-117; and(B) All of the applicable requirements of §§ 18-44-114 and 18-44-115 were satisfied.(3)(A) The summons shall be in customary form directed to the sheriff of the county in which the action is filed, with directions for service of the summons on the named defendants. In addition, the clerk of the circuit court shall issue and direct the sheriff to serve upon the named defendants a notice in the following form: Click here to view form.
(B) If within five (5) days, excluding Sundays and legal holidays, following service of the summons, complaint, and notice the defendant or defendants have not filed a written objection to the claim of the plaintiff, the court shall immediately issue an order discharging the lien upon the property described in the complaint.(C) If a written objection to the claim of the plaintiff is filed by the defendant or defendants within five (5) days from the date of service of the notice, summons, and complaint, the plaintiff shall obtain a date for the hearing of the plaintiff's complaint and shall give notice of the date, time, and place of the hearing to all defendants.(4)(A) The action shall be heard as expeditiously as the business of the circuit court permits.(B) Evidence may be presented by affidavit, subject to Rule 56(e),(f), and (g) of the Arkansas Rules of Civil Procedure.(5) If the circuit court finds that the lien was not in the form required by § 18-44-117 or that the applicable requirements of §§ 18-44-114 and 18-44-115 were not satisfied, then the circuit court shall enter an order discharging the lien.(6) The prevailing party shall be entitled to a reasonable attorney's fee and the costs of the protest.(g) Nothing in this section shall be construed to limit the right of an owner, mortgagee, or any other person with an interest in the property to contest the lien by declaratory judgment proceedings under § 16-111-101 et seq.Acts 1963, No. 66, § 2; A.S.A. 1947, § 51-641; Acts 2005, No. 2287, § 2; 2009, No. 454, § 3.