Georgia Construction, Bond & Lien Law Blog


Home Renovations and Exposure to Dangerous Chemicals

Posted in Uncategorized by Blue Blog on the October 30th, 2012

The construction lawyers at the Cobb Law Group welcome guest blogger and health advocate, Brian Turner to our Georgia Construction, Bond & Lien Law Blog.  He warns about the health and safety concerns that one should keep in mind while doing home renovations or DIY projects as exposure to certain materials can cause harm to yourself and family members.

Georgia Materialmen Lien and Payment Bond Attorneys

Home renovations may put homeowners at risk of exposure to dangerous chemicals and toxic substances.  Homeowners are at risk of respiratory illnesses related to exposure to substances like asbestos or the fumes from paints or cleaning agents.  Other risks are tied to the building materials selected for the renovation projects.  For the do-it-yourself crowd, little may be known about working with certain types of building materials in home renovation projects.  One popular building material is vinyl siding and it comes with its share of risks that people should be aware of when working with popular material.

Vinyl materials in construction
Vinyl siding is commonly marketed as a green product that is fire retardant.  Its wide use in the construction industry is tied to how affordable the composite materials.  Vinyl siding contains poly vinyl chloride and is one of the most common synthetic materials available.  It is used externally for wall cladding and internally for interior finishes.  In recent years, vinyl is used internally in the temporary housing units for Katrina victims put occupants at risks.  Those temporarily relocated to the trailers ended up being stuck in the units for a longer time than originally planned and became sick when the units became too hot.  The vinyl components of trailer units were the flooring and cabinets.  When the heat became intense, formaldehyde was released into the air and inhaled by the Katrina evacuees.  In home renovation, PVC vinyl siding products may not be suitable for locations where the heat can become a problem.

Mold and Vinyl

As an alternative to other commonly used building products, vinyl is chosen because of its durability.  It is less likely to rot than other types of building materials.  One downside to vinyl is that it can attract mold.  The small crevices on the surface of the material make it vulnerable to mold.  During the spring and fall, the risks for developing a mold problem is greater.  During the spring, there is more moisture and in the fall there is less sunlight.  Mold problems can cause respiratory problems if not eliminated and removed regularly.  Vinegar is a great cleaning agent for mold removal.  Tougher mold conditions may warrant the use of bleach products.  When mold is detected, it should be removed immediately.

Vinyl and flooring

When the home renovation project is being considered, the condition of the flooring should be evaluated.  Older homes may have vinyl flooring.  As long as the floors are in good condition, the vinyl flooring may pose limited risks to the occupants of the home in most cases.   If not being replaced, the flooring tiles should be cleaned by buffing with a machine with a 300 RPM to avoid damaging the tiles. Some of the older homes may contain vinyl flooring products that contain asbestos.  The vinyl flooring products may contain asbestos materials.  Individuals who are considering removing their vinyl flooring due to asbestos should be cautious to avoid violating the Clean Air Act, which requires that experts be used to handle the removal process.

Vinyl products used in home renovation projects should be carefully considered before being incorporated into the building project.  In homes with vinyl building materials, proper cleaning techniques should be employed to minimize safety risks.

 

Joint Venture Contracting in Georgia (Part I)

Posted in Contracts,Joint Ventures by Blue Blog on the October 23rd, 2012

Georgia Joint Venture Contract Agreement Attorneys

by Mark Cobb

By statute and by discipline, every good lawyer must participate in continuing legal education.  Recently, I participated in a very useful seminar which focused on joint venture contracting, and in the next few weeks, you can read about some of the great information we learned for those Georgia contractors who want to use joint venture contracts in Georgia.

What is a Joint Venture?

A Joint Venture (commonly referred to as a “JV”) is used to refer to two or more businesses which enter into a cooperative endeavor usually for a finite period or specific project (for example, to construct a particular building).  It is possible for the parties in a joint venture to create a new, separate corporation, limited liability company, or partnership.  But, it is also possible that the participants retain their individuality and operate collectively pursuant to a “joint venture agreement”.  In either case, the parties in the JV share in the management, profits (and losses) and risks in accordance with the terms of their joint venture agreement or joint venture contract.

Why Georgia Contractors Should Consider Creating a Joint Venture:

There are many, many reasons why contractors may decide to join together in a short-term partnership in order to bid and build on Georgia construction projects.  Some of the popular reasons for joint ventures include the following:

  • The two business entities are in a better position to exploit potential opportunities under various federal set-aside programs;
  • By themselves, a participant in a joint venture contract may lack the necessary resources to complete the project; however, by combining financial, physical and human resources in order to meet the challenges of a particular project, they may be able to successfully bid and perform under a construction contract;
  • Joint Venture Agreements spread the associated risks between/among the JV participants; and
  • Joint Ventures can be a useful vehicle for employing specific project delivery methods.

Naturally, there are advantages as well as disadvantages for creating joint venture contracting, such as:

Advantages of Joint Venture Contracting in Georgia:

  • Joint Ventures are fairly easy and simple to implement; they are straightforward and a cost-effective means to combine resources;
  • Because they are based upon Georgia partnership law principals, they are predictable;
  • Joint Ventures and their governing documents allow a great deal of flexibility based upon the needs of the individual participants and the precise scope of the construction project;
  • The limited scope–joint ventures are usually appropriate only on one construction project at a time; and
  • Joint Ventures are a widely accepted vehicle on construction projects.

Disadvantages of Joint Venture Contracting in Georgia:

  • Because Georgia partnership law applies, the participants have joint and several liability;
  • Some participants are concerned about the sharing of trade secrets and processes;
  • Joint Ventures add an additional layer of liability;
  • Professional relationships with down-stream contractors as well as up-stream developers, architects and engineers must be managed; and
  • There is a risk of potential philosophical differences or personality conflicts between the co-venturers.

Thankfully, a carefully crafted joint venture agreement can assuage many of these concerns; it is vital, however, that each of the parties to a JV Agreement and their attorney weigh all the risks and management issues in order to carefully draft the documents which will govern the joint venture during each phase of the project, from bidding to completion.  In our next installment on Georgia joint venture contracting, we will stress the need for a quality, written contract between parties as well as the key issues that should be addressed in every joint venture agreement including the operational aspects, the internal management, risk allocation, and defaults and remedies available to the participants.

Please feel free to contact the construction lawyers at the Cobb Law Group if you are contemplating participating in a joint venture anywhere in the state of Georgia; we welcome comments from our readers regarding their experiences with joint venture projects.

To read Joint Venture Contracting in Georgia (Part II), click here.

To read Joint Venture Contracting in Georgia (Part III), click here.

To read Joint Venture Contracting in Georgia (Part IV), click here.

To read Joint Venture Contractingin Georgian (Part V), click here.

CURRENT TRENDS ON GEORGIA PAYMENT BOND CLAIMS

Posted in Miller Act,Payment Bonds by Blue Blog on the October 19th, 2012

Atlanta Payment Bond Claim Laywer
by:  Mark Cobb

An Atlanta payment bond claim, a Marietta payment bond claim, a Coweta County payment bond claim, an Athens, Clarke County payment bond claim, a Fort Benning, Georgia payment bond claim, and a Savannah payment bond claim.  This is my week so far!

Since the Cobb Law Group’s construction law practice has been so busy with filing and perfecting claims against payment bonds this week, we thought our readers might appreciate hearing some of our ideas on the payment (and nonpayment) trends that we are seeing!

So far this week, we have initiated six payment bond claims.  Although the mechanics lien attorneys at the Cobb Law Group also typically file numerous mechanics and materialmen lien claims in Atlanta and throughout Georgia each week, so far, we haven’t filed any new Claims of Liens.  We monitor our clients’ files very carefully, and since almost all of our clients are construction professionals (in particular, they are specialty subcontractors and material suppliers), we have the advantage of noticing trends affecting the industry before others.  Also, since we have been focused on Georgia subcontractor law for over 20 years, we recognize the cyclical nature of the trends and can see the big-picture.

Unfortunately, the U.S. economy is not recovering as quickly as we need; our little feelers indicate certain geographic pockets experiencing slight increases in construction, but other areas continue to be stagnant. Although they are not as plentiful as we would like to see, there are government public works projects providing construction contracts to subcontractors and purchasing construction materials from suppliers.  Without spending too much time on this (we’ll save it for another blog article), government projects are subject to difficult bidding procedures and, increasingly, bid preferences for local contractors which greatly limit the playing field for legitimate, regional contractors.  Nonetheless, there are some government construction projects out there which are providing necessary work.

Georgia Payment Bond Claim Statute of Limitations

PAYMENT BOND DEADLINES:

Government projects are notoriously slow-paying which means that subcontractors and suppliers have to vigilantly monitor their (i) 60-day deadline from the date a Georgia lien or bond waiver was signed to file an Affidavit of Nonpayment if they haven’t received payment, and (ii) 90-day deadline from the last day they were on the job to make their claim against the surety backing the payment bond.

MILLER ACT AND BABY MILLER ACT:

Furthermore, federal construction projects are governed by the Miller Act; State of Georgia construction projects are governed by Georgia’s version of the Miller Act which is referred to as the Little Miller Act.  It is essential that everyone understand that these two Acts–although parallel in many respects–differ substantially!

Because the government projects are slow-paying, our clients are asking us to timely file their claims against the projects’ payment bonds.  As mentioned, above, our Georgia payment bond lawyers have initiated six new claims so far this week.  All six of these claims were approaching the deadlines in which a valid claim could be made.

It is interesting to note, however, that of the six claims we have begun in the last day or so, we have settled (or almost resolved) four of them!  Here’s the break-down:

  • payment of  two of the payment bond claims have been paid in full via joint-check;
  • payment of two of the payment bond claims have been promised by the general contractor within the next 30 to 45 days; and
  • two of the payment bond claims have not yet received a response (but we are hopeful they will get paid quickly!).

ENFORCE YOUR BOND RIGHTS TO GET PAID:

So, what exactly does this little study show?  Slow-pay is not “no-pay”, but you will probably have to exercise your legal rights to make a claim against the payment bond in order to get paid; in four out of our six examples, 2 have been paid and 2 are promised to be paid.  Thus, our clients have already released two payment bond claims, and two others have been suspended pending payment by the surety or the general contractor.  That’s recovery of 2/3 of the cases in a matter of hours after bringing a payment bond construction lawyer on board.  Prime contractors understand the government’s slow-pay mechanism; however, as the entity posting the bonds, it is the prime contractors’ credit rating which is affected by a subcontractor’s or materialmen’s claim; thus, it is in the best interest of the general contractor to pay the third-tier supplier or subcontractor rather than face increased premiums in the future.

We firmly believe that if our clients had not made their payment bond claims before the statute of limitation ran, they would not have received payment.  Making these claims is a wonderful tool in the arsenal of Georgia subcontractors and suppliers to make sure that payment is made.  If you need to discuss nonpayment issues on a public works project with our Georgia payment bond attorneys, please contact us today.

Hire a Veteran!

Posted in Miscellaneous by Blue Blog on the October 5th, 2012

Georgia Construction Law Attorneys who File Liens

by:  Mark A. Cobb

The Cobb Law Group appreciates the sacrifices made by our country’s military veterans, and we are pleased to share a wonderful resource for our readers.  If you have a job vacancy–construction or otherwise–then you should consider the American Jobs for American Heroes website which allows you to post a free job advertisement.  The web site is designed to put more than 60,000 unemployed National Guard members and military veterans back to work in private sector jobs.  This could be a great resource for Georgia’s prime contractors, specialty trade contractors and material suppliers to find and hire skilled, trustworthy employees and help out a veteran.

If you (or anyone you know) seeks trained, experienced, and reliable employees, then you can register at the American Jobs for American Heroes website and easily post your  job openings for free!  The campaign is an initiative of the Corporate America Supports You and the Military.  According to the website, national guardsmen have much to offer employers as these individuals are trained to be both leaders and to work as part of a team.  In addition, the National Guard provides more than 107 types of training, many of which correspond directly to types of skills training provided by companies for their employees, and includes those skills necessary for our clients and their construction, development and contracting projects in such diverse areas as electrical, equipment operation, drafting, logistics, and HVAC.

One sobering point–the website mentions results from mobilizations.  Apparently, National Guardsmen who return home from Iraq and Afghanistan experience a tremendous amount of stress when it comes to the prospect of unemployment upon their return.  For example, the website says, “the 41st BCT Army National Guard out of Oregon returned from deployment in April 2010 and reported 969 out of approximately 3,000 soldiers faced unemployment. This statistic, a staggering 34%, was obtained at the demobilization station before soldiers had even returned to home station. Once the unit is home for a short time the rate for the unit is expected to rise to as much as 54%”.

Please leave a comment if you are a veteran returning home from deployment and looking for a job or if you are an employer posting a construction job opening on the web site, and know that the Georgia construction attorneys at the Cobb Law Group appreciate everything you do!

2009 Georgia Lien Law Changes: A Summary

2009 Georgia Lien Law Changes

by Mark A. Cobb

Cobb Law Group

Since our law firm has a significant core practice area in which we file and perfect mechanics & materialmen’s liens and payment bond claims throughout Georgia, we address prospective clients’ lien questions almost everyday.  We are surprised how many contractors and suppliers’ knowledge of Georgia’s construction lien requirements is based upon obsolete lien laws.  In 2009, the Georgia legislature approved several significant changes to the Georgia’s Mechanics and Materialmen’s Lien Act.  Since we continue to get so many questions regarding these changes, we thought a brief review of the changes made to Georgia’s lien laws in 2009 would be useful to many potential Georgia lien claimants:

SOME OF THE SIGNIFICANT 2009 GEORGIA LIEN LAW CHANGES:

  • Date Georgia’s 2009 Lien Law Revisions Went Into Effect:  March 31, 2009;
  • Notice to Contractor/Notice to Owner: These notices to contractors (sometimes called Notices of Furnishing) must be sent to the owner and the contractor by registered mail, certified mail or statutory overnight delivery at the addresses specified in the Notice of Commencement (the former statutes did not specify the method these notices were to be given);
  • Deadline for Filing a Claim of Lien: A Claim of Lien must be filed within 90 days after the lien claimant actually worked on the project or supplied materials to the project (the former requirement was more ambiguous requiring that a claim of lien be filed within three months from the last day worked); it is very important to note that Georgia’s new lien waiver forms may, for all practical purposes, shorten this deadline to sixty days from the date the lien waiver was signed;
  • Deadline for Sending a Copy of the Lien to Owner & Contractor: A lien claimant is required to send a copy of the lien to the owner (and, if a Notice of Commencement was filed, to the general contractor) within two business days after the claim of lien is filed (the former lien requirement was ambiguous as to the deadline for sending a copy of the lien to the owner);
  • Deadline for Perfecting or Enforcing a Claim of Lien: A lien claimant must file a legal action against the party with whom the lien claimant contracted within 365 days of the date the lien was filed (the former requirement was more ambiguous requiring that a legal action be filed within one year of the last day worked by the lien claimant); it is important to note that this deadline may be expedited if the property owner or the general contractor files a Notice of Contest of Lien (see below);
  • What is a Legal Action (for purposes of lien enforcement): Georgia’s lien statute specifies that the lien claimant’s obligation to file a “legal action” may include filing a lawsuit, filing a proof of claim in a bankruptcy proceeding, or filing a demand for arbitration action (the former statute did not include arbitration as a legal action which would perfect the lien);
  • Deadline for Filing a Notice of Action: The lien claimant must record its Notice of Filing of Action For Claim on Mechanics and Materialmen’s Liens within 30 days from the date it began a legal action to enforce its lien rights (the former statutes required that this notice be filed within 14 days);
  • Notice of Lien Discharge Bond: If an owner, contractor or other interested party files a bond to discharge a materialmen’s lien, then, within seven days of filing a bond to discharge a lien, the party filing the bond must give the lien claimant notice of the filing of the bond (the former lien provisions did not require that notice be given to the lien claimant);
  • Notice of Contest of Lien:  This is an entirely new section which allows property owners and contractors the ability to accelerate the lien claimant’s deadline to file a legal action to enforce its lien claim; it is important to note that a properly filed lien contest will shorten the lien claimant’s deadline to file a legal action to enforce its lien to 60 days from its receipt of the notice;
  • New Georgia Lien Waiver and Lien Release Forms:  The revisions introduced new interim lien waiver forms and new final lien waiver forms as the only acceptable lien waiver forms to be used in Georgia; some of the material changes to the new forms include (i) specific language requirements; (ii) requirements that capital letters and a 12-point be used, (iii) the new forms release bond rights as well as lien rights, and, perhaps most importantly, (iv) sixty days after the lien waivers are signed, conditional lien waivers become unconditional lien waivers;
  • New Affidavit of Nonpayment Form: Similarly, the statutory form for the Affidavit of Nonpayment has been changed and the older form should not be used any longer; changes to this form include (i) required formatting to include capital letters and font size, (ii) specific language required, (iii) the deadline for filing an Affidavit of Nonpayment has been extended from 30 days to within 60 days, and (iv) if an Affidavit of Nonpayment is filed, then within seven days of filing, a copy of the Notice of Nonpayment must be sent to the property owner (and if a Notice of Commencement had been filed then notice must also be sent to the general contractor);
  • New Claim of Lien Form:   The Georgia Claim of Lien form was revised to include (i) statutory required language, (ii) specific language printed in 12 point bold font, and (iii) clarification that the date when the claim became due is that last day in which a contractor or subcontractor actually worked on the real estate or a material supplier provided materials for use on the project.

Please keep in mind that this article is a brief summary of the significant changes to the lien laws made by the Georgia legislature; there are additional changes which have not been covered in this article; similarly, this article does not include matters which did not change (but with which lien claimants must strictly comply); thus, if you have a potential construction lien claim or if you are an owner or a general contractor trying to address a claim lien against your project, then you should contact an experienced Georgia construction law attorney who can help you understand, evaluate and file the claim of lien.  Contact the Cobb Law Group to help you with your lien claim today!

We invite you to leave a comment below and tell us how the 2009 changes in the Georgia Lien Laws have affected you or your business.