Understandably, many suppliers and subcontractors in Georgia confuse a Preliminary Notice of Lien and a Mechanic’s or Materialmen’s Lien. (Due to the lingo in other states’ laws, many people also confuse the term “Preliminary Lien” or “Pre-Lien” with “Notice to Owner”, but we’ll save that for another bLAWg topic!).
A Georgia Preliminary Notice of Lien (sometimes referred to as “Pre-Liens”) is a pseudo-lien filed by a subcontractor, supplier, or materialmen within 30 days of the first day in which a party delivered any material or provided any labor or service for which a materialmen’s lien may be claimed. It’s recorded in the clerk of court’s office and must contain certain information such as (i) the name, address and telephone number of the potential lien claimant, (ii) the name and address of the party with whom the potential lien claimant has contracted, (iii) the name of the owner of the real estate on which the project is being built, (iv) a description of the real estate where the project is located, and (v) a description of the labor, services, and materials furnished by the subcontractor or supplier. As long-time readers of this blog have learned, all of Georgia’s lien laws must be “strictly construed” which means everything related to construction liens must be exactly as the Georgia statutes required and that includes filing Preliminary Notices of Lien so we suggest hiring a Georgia lawyer to help you with these documents.
Why would a subcontractor or supplier in Georgia want to file a Preliminary Notice of Lien?
There are many reasons why filing Preliminary Notices of Liens are good and help increase your likelihood of recovery. But, a popular (and necessary) reason for filing them are to protect a potential lien claimant from lien dissolution affidavits. If a supplier or subcontractor files a lien after a general contractor has signed a contractor’s affidavit, then that lien may–or may not–be valid. But, if a supplier or subcontractor has filed a Preliminary Notice of Lien, and then later files a materialmen lien, a contractor’s affidavit will not dissolve the lien. Instead, the burden shifts to the owner to make sure that the person filing the Preliminary Notice of Lien gets paid! That’s a very good reason to include Preliminary Notices of Liens as a part of your standard construction business practice.
It is important to note that a Georgia Preliminary Notice of Lien is not a materialmen’s lien or a mechanic’s lien. It expires within 90 days of the last day in which you delivered materials or supplied labor or equipment on the project. Thus, if payment hasn’t been received, you must still file a materialmen’s lien within 90 days of the last day in which you were on the project even if you filed a Preliminary Notice of Lien. Failure to timely and accurately file your lien will result in forfeiture of your lien rights and, likely, diminish your ability to recovery the money you are owed.
Thus, a Georgia Preliminary Notice of Lien should be filed within 30 days of your first day on the job; and, if necessary, a Georgia Materialmen’s Lien should be filed within 90 days of the last day you were on the job. Please contact us today, if we can help you protect your lien rights.
Please leave a comment and share with us your experience with Preliminary Notices of Liens!
Recently, we wrote a post about Georgia Affidavits of Nonpayment which are documents with which every subcontractor and supplier working on Georgia construction projects should be familiar. In summary, if you sign a lien waiver but you don’t receive payment, then within 60 days of the date of the lien waiver, you must file an Affidavit of Nonpayment in the real estate records of the county where the real estate project is located. These deadlines must be met, and failure to do so may result in complete inability to collect your money from your contractor or customer, file a materialmen’s lien, or make a claim against a payment bond. This is so important, and we have received so many telephone questions, that I invite you to review our full post for more information.
Several people have for asked the “next” step.
If you are paid for your services, then you may not have to do anything else. According to the Georgia Code, those affected by the Affidavit of Nonpayment which you file (such as your customer, the general contractor, the property owner, etc.) may request that you file an Affidavit of Payment in order to “cancel” the Affidavit of Nonpayment you had received. If you are requested to prepare one, you must do so. On the other hand, your Affidavit of Nonpayment will eventually expire of its own accord typically upon the earlier of (i) your execution of a subsequent interim lien waiver or final lien waiver or (ii) 90 days after you stop your performance on the job.
If you do not receive payment very shortly after filing your Affidavit of Nonpayment, then you are (likely) on a very short time schedule in which to file your mechanics or materialmen’s lien or make your payment bond claim. Your deadline to file a construction lien or file a claim against a payment bond ends 90 days from the date you were last on the jobsite–the calculation of this period has nothing to do with the deadlines required for Affidavits of Payments. Click here to read more about Georgia’s lien laws.
PRACTICAL TIP: Calendar your deadlines:
1. If you execute any lien waiver, then make sure you promptly receive payment; if you do not receive payment within 45 days, consider contacting a Georgia construction lawyer;
2. All mechanics and materialmen’s lien in Georgia must be filed within 90 days of the last day in which you were on the project. This period is not extended even if you file an Affidavit of Nonpayment so contact a Georgia construction lawyer around 60 days following your last day on the job; and
3. Most payment bond claims must be filed within 90 days of the last day in which you worked on the project. This period is not extended even in you file an Affidavit of Nonpayment; so, make sure you contact a Georgia construction lawyer around 60 days following your last day on the job.