Georgia Construction, Bond & Lien Law Blog


Contracts, Nonpayment and Georgia Liens

Posted in Materilamen's Liens by Blue Blog on the August 6th, 2014

Mark Cobb is excited about speaking to Atlanta architects and engineers at a Construction Law continuing education seminar sponsored by HalfMoon Education.  Mark is speaking on IMPROVING THE PROJECT OUTCOME WITH ACCURATE AND EFFECTIVE CONSTRUCTION CONTRACTING in which he will address the basics of general contract law, the unique aspects of construction contracts and how to avoid non-performance.

One aspect Mark will address are non-payment issues including the filing of a Claim of Lien against the project.  Here is a sample of the summary of Georgia’s lien laws which he will present:

Questions About Georgia's Lien Law

Who Can File A Lien?

∙    Architects and Engineers, Surveyors, Foresters
∙    Contractors in privity with the Owner
∙    Subcontractors in privity with the GC
∙    Sub-subcontractors and suppliers if they sent an NTO (and an NTO was required)
∙    Remember:  if you do not have a required license, then you do not have the right to file a lien

Why File a Lien?

∙    To secure the money you are owed
∙    To make third parties responsible for the money you are owed (even though you didn’t contract with them)
∙    To apply pressure on those upstream who may be delaying payment

When Would you Consider Filing a Lien?

∙    When you are owed money
∙    Retainage!

Important Things to Know About Liens:

∙    Lien Claimant must have substantially complied with the contract
∙    Lien is (generally) enforceable up to the amount of the improvements actually made
∙    Thanks to legislative efforts on behalf of the AGC Georgia, liens may be for full contract amounts
∙    Contractors who abandon project may not be entitled to file a lien (however, they may recover amount for partial performance under theory of quantum meruit)
∙    A Lien Claimant who ceases work after being told they are not going to be paid can file a lien

Filing Deadlines for Liens:

∙    90 days from Last Day Worked or 60 days from date of Lien Waiver (whichever is shorter)
∙    Last Day Worked is NOT Invoice Date
∙    Lien must be perfected (“suit filed”) before the first anniversary of the filing of the lien
∙    Liens must be perfected within one year of the date on which they are filed, otherwise, they automatically expire
∙    Liens are perfected by (i) filing a lawsuit against the entity with whom you contracted and (ii) filing a Notice of Filing of Action to Perfect Lien with the clerk of court in the county where the project was located
∙    “Foreclosure” of Liens are generally an additional, separate step to perfecting liens.  Unless there is jurisdictional alignment, a lien claimant must wait to seek foreclosure against the owner of the real estate until after they have received a judgment against the entity with whom they original contracted

Comments Off on Contracts, Nonpayment and Georgia Liens

Comments are closed.