Georgia Construction, Bond & Lien Law Blog


Notice of Intent to Lien in Georgia

Posted in Materilamen's Liens,Notices to Owner (NTO's),Preliminary Notice of Lien by Blue Blog on the April 15th, 2016

Construction Payment App

by Mark A. Cobb

Many clients ask about Georgia’s Notice of Intent to File Lien requirements, and there are always surprised to hear the short answer: Georgia does not require any type of Notice of Intent to File Lien. However, the longer answer may provide some helpful insight for a lien claimant getting the money they are owed. Let’s explore this a bit further . . .

In Georgia a Notice of Intent to File Lien is not the following:

First, let’s take note of what a Notice of Intent to File Lien is not. It is NOT the same as a Notice to Owner or Notice to Contractor (sometimes called a Notice of Furnishing). In order to take advantage of Georgia’s lien statutes, certain subcontractors and suppliers are required to send a Notice to Owner/Notice to Contractor within the first 30 days that they begin working or supplying to the construction project. Thus, it is important to understand the difference between a Notice of Intent to File Lien and a Notice to Owner. For more information on Georgia’s Statutory Construction Notice Scheme, please click here > >

Similarly, a Notice of Intent to File Lien is NOT a Preliminary Lien. The Georgia Mechanics and Materialmen’s Lien Act includes a section on filing Notices of Preliminary Lien. A preliminary lien is not a Claim of Lien under Georgia law; instead, it is an optional tool used by subcontractors and suppliers to defeat contractor affidavits and put the owner on notice that the potential lien claimant is performing work or supplying materials to the project. For more information on Georgia’s Preliminary Lien scheme, please click here > >

In some states, a Notice of Intent to File Lien is a prerequisite to filing an action lien claim. In Georgia, however, potential lien claimants do not need to send a Notice of Intent to File before filing a construction lien, stop notice or making a bond claim.

What Use does a Notice of Intent to Lien have in Georgia?

As mentioned above, some states have specific requirements regarding the timing and use a Notice of Intent to File Lien; since Georgia does not currently have this requirement, we have the option of using it to help our clients get their payments more quickly and less expensively.

Since Georgia does not have a requirement that lien claimants send a Notice of Intent to Lien prior to filing their claim of lien with the clerk of court, the project owner or the general contractor may not be aware of any downstream payment problems until they receive notice that a lien has filed. Responsible project owners and general contractors often involve themselves immediately upon their receipt of a copy of the lien; this, of course, can lead to prompt payment (which is the goal!). Imagine, however, if the lien claimant had send a notice to the project owner, the general contractor, the surety and other interested parties prior to filing the lien. This would give responsible project developers and contractors the ability to involve themselves in the payment issues and, possibly, lead to a prompt payment to the potential lien claimant.

Using such a notice–a (unofficial) Notice of Intent to File Lien–could be effectively used to inform those parties upstream of a subcontractor payment issue without the cost and expense of preparing an filing a materialmen’s lien.

Furthermore, since Georgia has no statutory requirement for an Intent to Lien, that means that such a letter can be customized to reflect such information as the potential lien claimant needs to encourage voluntary payment by the owner or contractor. For example, some of the notice which we have sent on behalf of clients may be very succinct and to the point. For example, it may say:

ABC SUB-SUBCONTRACTOR was engaged by ABC SUBCONTRACTOR to perform work on the NEW PROJECT located in YOUR TOWN, GEORGIA; to date, ABC SUB-SUBCONTRACTOR is owed $_____ for it work. Unless payment in full is received within five (5) business days, then notice is hereby given that ABC SUB-SUBCONTRACTING will file a lien against said project pursuant to the Georgia Mechanics and Materialmen’s Lien Act.

In other situations, it may be useful to provide more details, include copies of such documents as the following:

  • Outstanding pay apps
  • the sub-subcontract (or highlight relevant provisions from the sub-subcontract)
  • detailed narraitve of the facts including work performed, communication issues
  • subcontractor project accounting
  • notices to owner/contractor (NTOs)
  • a copy of the lien to be filed if payment is not forthcoming

Also, sometimes getting a notice from a subcontractor on an attorney’s letterhead can make a general contractor or owner pay a little more attention to the situation. For these and many other reasons, it is frequently recommended that a lien claimant send a Notice of Intent to Lien in Georgia so long as there is time to prepare and send the notice without missing the deadline to file the lien.

An Important Reminder Regarding Lien Deadlines

Regardless whether a lien claimant utilizes the advantages of serving a Notice of Intent to Lien on a construction project owner or a general contractor, it is important to note that sending such a notice DOES NOT extend the deadline to timely file a materialmen’s lien. In Georgia, liens must be filed either within 90 days of the last day of actual work on the job or 60 days from the date of a lien waiver whichever is shorter.

 

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