Update on Georgia’s Lien Law and HB 434

(UPDATED MAY 9, 2013)  GOVERNOR SIGNED HB 434 INTO LAW; click here for more information!

(UPDATED APRIL 10, 2013) TO SEE THE LATEST INFORMATION ON THE PENDING CHANGES TO GEORGIA’S LIEN LAWS, PLEASE SEE OUR FOLLOW-UP BLOG ENTRY BY CLICKING HERE.

As the current session of the Georgia legislature winds down, we want to send our kudos to Rep. Tom Weldon, Wendell Willard and Mike Jacobs for supporting HB 434 which attempts to amend Georgia’s Mechanic’s and Materialmen’s Lien Law.  The proposed amendment will allow Georgia’s contractors, specialty subcontractors and material suppliers to specifically include pre-judgment interest, General Condition Costs and other sums due under their contract as lienable items.  This proposed bill is in direct response to a recent court decision which negatively impacted construction professionals by excluding General Condition Costs as a lienable item in Georgia.

Specifically, HB 434 amends O.C.G.A. Section 44-14-361 to include the following specially crafted language for new subsection (c):

(c) Each special lien specified in subsection (a) of this Code section shall include:

(1) The amount due and owing the lien claimant under the terms of its contract, subcontract, or purchase order; or

(2) In the absence of a contract, subcontract, or purchase order, the unpaid value of the labor, materials, and services provided by the lien claimant for the improvement of the real estate. Such lien shall include interest on the principal amount due in accordance with applicable law.

To see a copy of HB 343, click here.  Currently, the bill is with the Senate Judiciary Committee.  We will keep you informed as this issue progresses.