by Mark A. Cobb
The Georgia Mechanics and Materialmen’s Lien Law Statutes (O.C.G.A. Section 44-14-360 et seq.) govern all aspects of filing construction liens in Georgia, and our construction lawyers have filed hundreds or thousands of liens on behalf of contractors, specialty subcontractors and material suppliers in virtually every county in Georgia!
Disclaimer: This blog post and its links (just like all of our blog posts) try to offer SOME of information regarding some of the most common questions which we get. Unfortunately, we cannot offer legal advice through a blog article, and you should not file a lien in Georgia based upon the information provided through our blog and website. Thus, we strongly encourage any potential lien claimant to seek competent legal advice from an experienced Georgia lien attorney in order protect your rights–we can provide you some useful guidelines in our blog articles, but we cannot cover all of the exceptions, loopholes, alternate solutions and pitfalls of filing construction liens in Georgia. When it comes to Georgia’s lien requirements and surety bond claims, there is simply no substitute for experience and Mark Cobb has over 20 years for experience! To learn more about Mark Cobb, please click here > >
Strict Compliance with every aspect of Georgia’s Lien Laws: Because materialmen’s liens essentially make a third party (such as the property owner) responsible for making sure that you get paid, Georgia courts have consistently required that lien claimants strictly comply with every aspect of the lien laws. To better understand Georgia’s strict compliance requirements, please click here > >
Preliminary Requirements for Filing a Lien in Georgia: Those in privity of contract with either the owner or the general contractor do not have any preliminary notice requirements in Georgia; however, if you are a third tier sub-subcontractor or material supplier then you probably need to send a Notice to Owner and a Notice to Contractor (sometimes called Notice of Furnishing, NTO, or NTC) within the first 30 days you began working on the project. To learn more about NTOs, please click here > >
Deadline for Filing a Lien in Georgia: All types of construction liens must be filed within 90 days of the last day in which they were physically on the job site (NOT invoice date!); if you signed a lien waiver, then your deadline to file a lien may be shortened to the 60th day from the date of the lien waiver. To read more about this, please click here > >
Georgia Lien Form: Although there is no magic bullet form for filing liens in Georgia, our legislature has mandated certain requirements which must be contained in the lien including some specific language and some particular font sizes. To see a copy of the Official Code of Georgia Section 44-14-361.1 with specific language requirements for liens, please click here > >
Costs & Jurisdiction for Filing a Lien in Georgia: Lien Claimants must file their Georgia liens in the county where the construction project was located. Liens are filed with the Clerk of the Superior Court and the filing fees are, currently, $5.00 for the first page and $2.00 for each additional page. To see a list of addresses, telephone numbers and websites for the clerk of court of each Georgia county, please click here > >
Statutory Notice of Filing of Lien: No later than 2 days after a claim of lien is filed with the clerk of court, lien claimant must send each owner of the real estate which you liened a copy of your lien.
Perfecting Your Lien: Unless the owner of the real estate where the lien is place files a proper Notice of Contest of Lien, a Georgia materialman’s lien will expire one year from date of the filing of the lien unless a law suit is filed against the entity with whom you contacted (if you are a subcontractor, this would likely be the general contractor; if you are a material supplier, then it might be either a subcontractor or the prime contractor. To read more about this, please click here > >
Georgia Notice of Filing of Action: Within 30 days of filing a law suit to perfect a construction lien, the lien claimant must also file a Notice of Filing of Action with the clerk of court in the county where the lien was filed. To read more about Notices of Filing of Action, please click here > >
Georgia Foreclosure of Lien Action: Sometimes, it is possible to combine the foreclosure of the lien action with the lawsuit a lien claimant filed within one year of the filing of the lien; however, jurisdictional or strategic differences may prevent this; if so, then after the “first” lawsuit is filed, and if the lien claimant prevails in that lawsuit, then Georgia’s lien laws require a second lawsuit to begin the foreclosure process (against the owner of the real estate). To read more about this process, please click here > >
Only Georgia Lawyers Can File Materialmen’s Liens in Georgia: As you can see from this very basic overview, filing a proper materialmen’s lien in Georgia is very technical and–from the first day you worked until the end of the lien foreclosure action–Georgia Claims of Liens must be in strict compliance with ALL of the requirements. Furthermore, its importanta for a potential lien claimants to understand that lien filing services are prohibited from filing construction liens in Georgia–only lawyers admitted to practice in Georgia are allowed to file materialmen’s liens in the lien records.
We hope that this overview on how to file a supplier lien or subcontractor lien on a Georgia job site has helped to provide you with useful and basic information regarding the lien process in Georgia. If you have worked on a Georgia construction project and you have not received payment, please contact an experienced Georgia construction attorney today. The lien and bond lawyers at the Cobb Law Group and help you, please telephone us at 1-866-960-9539 or email us today. We can help you prepare and file your lien anywhere in the State of Georgia!
by Mark A. Cobb
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.
Almost every day we receive questions about Georgia’s Notices to Owners and Notices to Contractors (“NTO”). One of the biggest pitfalls of sending out your own NTO, is that Georgia’s notice requirements mandate that information contained in the NTO must use information contained in the Notice of Commencement filed by the project’s general contractor.
For example, a supplier or subcontractor must send the Notice to Owner at the addresses contained in the Notice of Commencement. Thus, if the Notice of Commencement lists the job site as the address, but an NTO is sent to the GC’s main office address, your NTO may be defective! Similarly, if the project is commonly referred to as “ABC Project” and you used that description in your NTO, but the Notice of Commencement calls it “Super Big ABC Project # 292929″, then your NTO may be defective. Of course, we all know that a defective NTO may prevent your from filing a Mechanic’s Lien in Georgia, making a claim against the payment bond, etc. This means lost revenues for your company.
One question we get is “How do I obtain a copy of the Notice of Commencement filed by a general contractor in Georgia?”
Now, the Cobb Law Group’s Virtual Construction Law Firm can help you with this. We have just added the forms which our client’s can use to obtain copies of the Notice of Commencement on private projects, State of Georgia construction projects, and local government projects in Georgia.
To find these forms and other useful documents, click on Cobb Law Group Virtual Law Firm;
To learn more about our unbundled legal services, click here;
To access our online construction documents for Georgia including the Notice of Commencement, please click here > >
Please try our out online legal forms and let us know what you think!
Happy New Year!
With the start of the new year, we are committed more than ever to providing quality legal services at fair and competitive rates. The Cobb Law Group’s virtual law platform is growing by leaps and bounds to provide clients with unbundled legal services at very affordable rates. Today, we added more Georgia legal forms, and there will be many more added in the near future.
If you need to send a Notice to Contractor (also called a Notice to Owner or an “NTO”) in Georgia, then you’ll really appreciate these forms. In case you aren’t familiar with NTO’s, they are written notices that all third-tier suppliers and subcontractors must send within the first 30 days that they supply or work on the project. If the third tier supplier or subcontractor fails to send this notice, then they may not be able to file a mechanic or materialmen’s lien or make a payment bond claim.
If you need a form just follow this link to purchase Georgia Notice to Owner (NTO) forms.
As you are aware, Georgia’s lien statutes require that third tier suppliers and subcontractors (those not in privity of contract with either the general contractor or the owner) file Notices to Owners IF the general contractor or the project owner filed a Notice of Commencement. Furthermore, according to the Georgia statutes, the Notice of Commencement must be filed within fifteen (15) of the commencement of the project. The Georgia Code also states, “The failure to file a Notice of Commencement shall render the provisions of this Code section inapplicable.”
So, what happens when the Notice of Commencement is not filed within fifteen days?
In a recent court of appeals decision (Southeast Culvert, Inc. v. Hardin Bros., LLC), the Georgia Court of Appeals gave general contractors some guidance on this question. In the case, the general contractor had filed its Notice of Commencement approximately 23 days after commencing work on the project; thus, the lien claimant argued that (i) because the GC filed its lien more than fifteen days after beginning work, (ii) the Notice of Commencement was not valid, and (iii) suppliers and subcontractors do not have an obligation to file a Notice to Owner is the Notice of Commencement is not valid.
The Georgia Court of Appeals did not agree with this reasoning; instead, it held that an eight-day delay in filing the Notice of Commencement did not relieve the lien claimant of its obligation to provide a Notice to Contractor. The court reasoned that neither party disputed that a Notice of Commencement had been filed–it was disputed whether the delay in filing the Notice of Commencement invalidated the supplier’s obligation to send an NTO. The court held that the code section which states “The failure to file a Notice of Commencement shall render the provisions of this Code section inapplicable…” was not applicable to this case. The Court reasoned that this code section applies only when there has been a total failure to file a Notice of Commencement at the time when a materialman must give a written Notice to Contractor to perfect its lien. There was no such total failure to file a Notice of Commencement here, merely an untimely filing.
We would love to hear whether you think this is a wise decision so please leave a comment below! If you have any questions, please do not hesitate to contact us.
We are always on the lookout for cases which affect our clients’ right to file materialmen’s liens; last week, the Georgia Court of Appeals handed down a decision that allows general contractors a little leeway with getting their Notices of Commencement correct.
Basically, the fact of the case are very common: a supplier to a subcontractor was not paid on a construction project so the supplier filed a Georgia Materialmen’s Lien for the amount due. They sued the subcontractor and prevailed; however, the subcontractor was unable to pay the debt, so the supplier looked to the supplier’s lien which it had filed to pay the debt.
The Real Property Owner’s Argument: Unfortunately, the supplier had not sent out it’s Notice to Owner or Notice to Contractor (hereinafter “NTO”) which, as we know from other blog entries, is essential for all third tier subcontractors and suppliers. Thus, the owner of the property showed the court that (i) it had timely filed a Notice of Commencement, (ii) the supplier failed to send an NTO, and (iii) consequently, the supplier’s lien was invalid.
The Supplier’s Argument: The supplier acknowledged that when a Notice of Commencement is filed, all third tier suppliers and subcontractors must send an NTO within 30 days of beginning to work on the project in order to preserve their lien rights. However, as the supplier pointed out there is an exception to this requirement for an NTO: if the Notice of Commencement was not proper, then there is no obligation to send an NTO. In this particular case, the supplier argued that the Notice of Commencement failed to include the general contractor’s telephone number (which is statutorily required).
The Court’s Decision: The Georgia Court of Appeals noted a fundamental principal of Georgia’s mechanic’s and materialmen’s lien laws–that lien statutes in derogation of the common law must be strictly construed in favor of the property owner and against the materialman. The court then discussed the difference between absolute compliance and “substantial” compliance. The court, thus, comes to the conclusion that the Notice of Commencement which contained all the necessary information except for the general contractor’s telephone number substantially complied with the lien statutes. Therefore, the court reasoned, the Notice of Commencement was valid, and the supplier’s failure to send the Notice to Owner invalidated the mechanic’s lien.
Some good news for suppliers in Georgia: On a brighter note, the court underscored the difference between information which was vital to the success of the Notice of Commencement such as the owner’s information or the real property description and the missing telephone number.
Please let us know your opinion regarding the Georgia’s Court of Appeal’s interpretation of the Georgia lien statutes!
Some of our clients refer to us a Georgia Lien Lawyers. And, yes, we file a lot of materialmen’s liens throughout the State of Georgia; but that is only part of all that we do. Another area which keeps us very busy is the filing and prosecuting of payment bonds on behalf of clients. So, what the difference between a construction lien and a payment bond claim?
First, mechanics or materialmen’s liens may be filed by contractors, subcontractors and suppliers on private construction projects when they are not paid for their services. A private project is generally a construction project owned by an individual or a business entity (such as a corporation or an LLC). For more information on liens, check out our post on Georgia Lien Law.
When a supplier, subcontractor or contractor is not paid on a public project, a lien cannot be filed. But, they can probably make a claim against a payment bond. A payment bond, in simple terms, is an insurance contract between the governmental entity which owns the project or the prime contractor and the insurance company. This insurance policy basically promises to pay subcontractors and suppliers in the event that the governmental entity or the prime contractor do not! Here are some things to keep in mind regarding payment bond claims:
• Although the rules and requirements are very different than Georgia’s laws for filing materialmen’s liens, there are some similarities. One similar deadline, for example, is that payment bond claims must be made within ninety (90) days of the last date in which you worked on the project;
• Payment Bonds on Federal Government Projects are governed by federal law commonly referred to as “The Miller Act”; Payment Bonds on Georgia projects are governed by state law commonly referred to as “The Little Miller Act”; although federal and state law has many similarities, they are different laws and each must be met in order to effectively make a claim;
• If the governmental entity or the general contractor files a Notice of Commencement, then those who are not in privity of contract with either the project owner or the prime contractor must send a Notice to Owner and a Notice to Contractor (“NTO”) in order to preserve the right to file a Payment Bond Claim;
• Read the payment bond! Each payment bond has information which is very useful to the subcontractor and supplier and will set forth the requirements to make a claim against the payment bond and the deadline for filing a lawsuit against the bonding company in the event that a lawsuit become necessary;
• Navigating the rules to enforce your bond claim rights can be confusing and difficult; therefore, we encourage you to contact a Georgia Payment Bond Lawyer to assess your claim and help you get paid.
We would also like to point out that there are other, common types of Payment Bonds; some private construction projects also have payment bonds. We plan to discuss these in the near future. In the meantime, if you have any comments or questions, we’d enjoy hearing from you.
Recently, we were interviewed for another Lowe’s for Pros article (click here to read the interview), and it made me think about a topic for this blog entry. It’s a new year, and that brings new goals for those in the consruction industry. Thus, we thought we’d help you work on some resolutions to help you with some business goals and practices to help your credit managers to improve recovery on your accounts!
As you know, the Cobb Law Group concentrates in small business law and construction law throughout the States of Georgia and Alabama. Until the economic collapse, we performed a lot of “positive” legal work for our clients such as entity formation, AIA contract review, mergers and acquisitions, etc. along with our traditional materialmen lien work and our payment bond claim practice. Since the recession/depression, however, we have had to learn much about commercial collections, garnishment, post-judgment collections, etc. in order to collect the money owed to our clients. In order to increase our collection rate, we learned very quickly to use every opportunity to collect information which might improve our chance of recovery.
For example, if we have contact with a commercial debtor, we try to gather information such as social security numbers, bank account information, or current construction projects which–if we obtain a judgment–gives us useful information to begin collection of the judgment sooner. Let’s say during a deposition we learn that a general contractor has several construction projects going, then we will try to get as much information on those projects; later, when we obtain a judgment, we may be able to garnish the general contractor’s draws on one or more of the current projects!
Similarly, you are able to help yourself and help us to improve the collectibility of a judgment. Usually, when you first encounter a new client or a new customer, they are very willing to share information about themselves in order to encourage you to supply them materials. Any information you gather could be helpful.
Thus, as the new year begins, you have the ability to improve your work habits by instituting a few of the following ideas:
1. Account Applications: If you already require customers to complete account applications, then you should review your current form. Consider adding additional information to include such things as (i) a corporate officer’s social security number, (ii) corporate officers’ home addresses, (iii) company website, (iv) names and address of those authorized to use the account, (v) email and mobile numbers, (vi) bank account information, (vii) for small businesses list the names of the shareholders. If you do not require a written account application, please consider using one!
2. Legibility: For all written communications (including account applications), make sure that everything is legible! I cannot tell you how many times we’ve seen a file with a faxed copy of a pencil message from someone with sloppy handwriting.
3. Guarantees: For new customers, particularly small, unestablished businesses, require the personal guarantee of an officer. This will probably greatly increase your ability to collect your debts down the road.
4. Notice to Owner: If you supply to anyone other than the prime contractor or the owner of the construction project, you probably need to send a Notice to Contractor and a Notice to Owner within 30 days of the first day in which you supply to the project.
5. Customer Comment Forms/Logs: Invest in software (or even a good notepad) which will enable you to memorialize information you receive from a customer. So, if he tells you that you that he hasn’t been paid, then get information from his as to whom owes him, the expected date of payment and write it down!
6. Contracts: Get it in writing. Include in your contract interest on past due balances and costs of collection (attorneys fees).
7. Consistency in Customer Names: Your customers may–either through sloppiness or intentional deception–give you inconsistent names. For example, they may contract with you are ABC, Inc., but their purchase orders are on ABC, LLC’s letterhead; their email domain may be ABC Company, but their checks to you are marked CBA Company. This can make identifying your customer difficult. Be vigilent and make them be consistent.
Of course, these are just a few general ideas. Each case is unique and each debt is different; however, the more information you have, it probably increases your chances of recovery. Please comment on some of your ideas below!
by Mark A. Cobb
As you know, we started the Georgia Construction, Lien and Payment Bond Law Blog in 2010, and as the year draws to a close we are grateful for our many readers and clients. Needless to say, the holidays are a very busy time of the year; unfortunately, we might allow our hectic schedule to be the cause for forgetting important deadlines. Thus, we thought we take a few minutes to remind you that certain materialman lien and payment bond deadlines may run out on you despite the holidays. Please take a few minutes to review your current accounts receivable, your construction contracts, your delivery tickets and make sure that no deadlines are missed–it can make the difference between marking an account “PAID IN FULL” or “WRITE-OFF”.
Here are some Georgia construction law statutes of limitations which you may find useful:
- Notice of Commencements: In Georgia, a Notice of Commencement should be filed within 15 days of the start of a construction project by the general contractor or the project owner;
- Request for a Copy of a Notice of Commencement: If an owner or a general contractor received a request for a copy of a Notice of Commencement covering a particular job, a copy must be given to the requesting partying within 10 days of the receipt of the request;
- Notice to Owner & Notice to Contractor: Third-tier subcontractors and suppliers must give Notice to Owner/Contractor within 30 days of the first day in which they are on the job or begin supplying materials to the job-site;
- Preliminary Liens: Georgia’s lien laws require that preliminary lien or pre-liens must be filed within 30 days of the first day in which you start on the job or begin supplying materials to the job-site;
- Georgia Mechanics, Materialmen and Construction Liens: Unless the deadline is shortened because the lien claimant signed a lien wavier, Georgia materialmen’s lien must be filed within 90 days of the last day in which the lien claimant was on the job or last supplied materials to the job-site;
- Payment Bond Claims: Unless the deadline is shortened because the payment bond claimant signed a lien waiver, claims made against payment bonds must be sent within 90 days of the last day in which the claimant worked on the job or last supplied materials to the job-site;
- Lawsuit to Perfect a Materialmen’s Lien: Georgia liens must be perfected before they automatically expire; in order to perfect the lien, a lawsuit must be filed within 1 year of the date in which the lien was filed against the party with whom the Georgia lien claimant contracted;
- Lawsuit on a Bond Claim: Depending on the type of the payment bond, the deadline to file a lawsuit on a bond claim may be as short as 6 months from the date the claim was made; there are many different types of potential payment bonds including federal payment bonds required under the Miller Act, state of Georgia or Georgia municipality payment bonds, and private payment bonds and different requirements apply to each type of bond;
- Notice of Action of Filing Suit: As part of the process to perfect a Georgia lien, a Notice of Action must be filed in the real estate records within 30 days of filing a lawsuit to perfect the mechanic/materialmen/construction lien; and
- Affidavit of Nonpayment: If a Georgia interim or final lien waiver and release is signed but payment is not received, the entity executing the lien waiver must file an Affidavit of Nonpayment with the clerk of court within 60 days of the date of the lien waiver or release in order to maintain its lien and/or bond rights.
There are just a few of the many deadlines that may affect you. Please contact us if you have questions regarding these or other deadlines or call us at 1-866-960-9539. Although it’s the holidays, our offices will be open the week between Christmas and New Years Eve. Merry Christmas!!
We get telephone calls and emails all the time asking about filing mechanics and materialmen’s liens in Georgia. Most people understand that the rules must be followed exactly, but they don’t know the rules. In addition, the rules regarding the filing of the liens changed substantially in 2009 thereby forcing everyone to learn new rules. In this blog entry, we are going to give you some basic guidelines for filing liens in Georgia. Please keep in mind, that we are sharing generalizations about the lien laws, and you really need to contact a lawyer knowledgeable in liens in order to advise you as to the specific facts of your matter.
Step One: Do I Need to File a Notice to Owner/Notice to Contractor? If you contract directly with the owner of the construction project or with the general contractor, then a Notice to Owner/Notice to Contractor (“NTO”) is not required. If, however, you have contracted with someone else (e.g., a sub-contractor), then an NTO is required to be sent within 30 days of the first day in which you are on the job. Failure to send this NTO may prevent you from filing a construction lien if you are not paid for your work or supplies.
Step Two: When Do I Need to File a Mechanic’s or Materialmen’s Lien? If you have worked or supplied on a construction project, but you have not been been paid, then you may file a materialmen’s lien against the real estate where the project is located. This must be filed within 90 days of the last day in which you literally worked on the project (you cannot use the date of the invoice).
Step Three: Where Do I Get the Forms to File a Mechanic’s or Materialment Lien? As mentioned above, the lien laws changed in 2009, therefore, the former forms are no longer valid. The Georgia Legislature and the Georgia Courts have repeated confirmed that mechanic and materialmen lien laws must be “strictly construed”; that is, a lien must comply with each and every requirement otherwise, it will be deemed invalid. Although there may be some “free” forms floating around the internet, we encourage you to consult with a Georgia attorney who knows about liens and the lien laws. Otherwise, your lien might not be valid. Common mistakes which we have seen include (i) failure to properly identify the real estate which is subject to the lien, (ii) failure to give statutory notice to the owner of the real estate, (iii) using the wrong lien form, and (iv) adding amounts to the lien which may not be included. An investment in preparing and filing a proper lien may make the difference in whether or not you see any recovery.
Step Four: After Filing the Lien, What Do I Have to Do? Mechanics’ Liens and Materialmen’s Liens are valid for one year from the date the lien was filed. In order to extend the life of the lien, you must do at least two things: (i) you must file a lawsuit against the person with whom you contracted, and (ii) withing 30 days of filing this lawsuit, you must file a Notice of Filing of Action in the real estate records where the lien is filed. Then, if your lawsuit against the party with whom you contracted is resolved in your favor, then you can take steps to foreclore upon your lien.
As we have stated, there are many little details and exceptions to filing liens and perfecting liens in the State of Georgia. If you wish for us to review the facts of your specifice case, please contact us. And please let us know if this blog entry is useful to you and whether or not you would like to see more entries like this!