By: Mark A. Cobb
Most of the subcontractors and specialty trade suppliers we speak to understand that all materialmen’s liens filed in Georgia must be filed within ninety days of the last day in which they worked or supplied materials to the job. However, very few of them understand that signing an interim lien waiver (or a final lien release) SHORTENS the deadline for filing a Claim of Lien in Georgia!
PRACTICAL TIP # 1: Change your mindset from 90 days from the last day worked to 60 days from the date of the lien waiver or 90 days from the last day worked–whichever is shorter!
That’s right, if you sign either a Interim Waiver & Release Upon Payment (a/k/a Interim Lien Waiver) or Final Waiver & Release Upon Payment (a/k/a Final Lien Release), then you have only 60 days from the date of the lien waiver in which to either (i) file an Affidavit of Nonpayment or (ii) file a lien pursuant to the Georgia Mechanics and Materialmen Lien Act.
The reasoning behind this oft-misunderstood rule is based upon the purpose of the lien waiver. In Georgia, lien waivers are essentially a document that a subcontractor or supplier signs which states (i) the amount due through a certain date and (ii) if the entity executing the lien waiver doesn’t let the construction project owner know that payment has been received with 60 days, then (iii) after 60 days, the owner can assume that payment was received (even if you didn’t receive the payment!). Thus, it is reasoned, that if you execute any lien waiver or Release, and you are not paid within 60 days of the date of the lien waiver, then Georgia law presumes that you received payment; and you are prohibited from filing a Claim of Lien after the expiration of the sixty days from the date of the lien waiver.
So how do I calculate the deadline for filing a mechanic’s lien in Georgia?
- First, calculate the 90th day from the date that you were last physically working on the Georgia project or delivered materials to the project; your deadline to file a Claim of Lien is before the 90th day (remember that weekends and holidays do not extend the deadline to file so you may actually only have 87 days following your last day worked to file your Materialmen’s Lien in Georgia–> click here for more information on calculating deadlines!)
- Second, if you signed a lien waiver, then calculate the 60th day from the date you signed the lien waiver; your deadline to file a Claim of Lien (or file an Affidavit of Nonpayment) is before the 60th day you just calculated (weekend and holidays probably to do not extend this deadline!)
- Third, compare the two deadlines which you just calculated–the first deadline to expire is your deadline to file your lien in Georgia!
For example, let’s analyze the lien deadline for a concrete supplier who provided materials to a Georgia construction project (private or public works); the last day they delivered materials was March 1; on March 15, they were asked to execute a Final Waiver and Release Upon Payment. If the concrete supplier does not receive payment, what is the deadline for filing a construction lien?
- Calculate 90 days from last day worked: Since they last delivered materials on March 1, the 90th day following this is May 30; in fact, however, the lien must be filed prior to May 30 (therefore, the lien must be filed on or before the last business day before May 30);
- Calculate 60 days from Lien Waiver: Since the lien waiver was signed March 15, the cement supplier has until May 14 in which to file an Affidavit of Nonpayment or file a Claim of Lien.
- Compare the date and go with the shortest! Thus, there is a May 29th deadline and a May 13th deadline. Since the May 13 deadline to contest the lien waiver expires first, the concrete supplier’s deadline for preparing and filing a supplier’s lien in Georgia is the last business day before May 14.
These deadlines can be very tricky, so it is very important to calculate your deadlines carefully so that you are not caught without payment and without recourse. If you have questions about filing and perfecting any type of construction lien in Georgia, please give us a call!
This is a general information article and should not be construed as legal advice or a legal opinion. The content above has been edited for conciseness and additional relevant points are omitted for space constraints. Readers are encouraged to seek counsel from a construction lawyer for advice on a particular circumstance.