Because the construction lawyers at the Cobb Law Group possess a great deal of experience representing subcontractors and suppliers throughout the entire state of Georgia, we speak with credit managers and business owners who are surprised to learn that it might be possible to file a mechanic’s and materialmen’s lien and make a payment bond for the same debt.  Our statewide practice allows our expertise and experience to be accessed by any construction professional in Georgia including Alto, Baldwin, Clarkesville, Cornelia, Demorest, Mount Airy, and Tallulah Falls in Habersham, County, Georgia where the following case study occured.

Most people understand that if payment is not received on private construction projects, the subcontractor or material supplier can file claim of lien to secure the debt; similarly, if payment is not received on a public project, the subcontractor or supplier can file a claim against the payment bond covering the project in order to receive payment.  However, it is not uncommon for the owner of a private project to require a payment bond as a condition of their construction contract with their prime contractor.  In the following case study, our Georgia lien and bond lawyers utilized the filing a lien and, simultaneously, making a payment bond claim in order to expedite recovery of the debt.

The Contracting Parties: Our client is a supplier and installer of sod, grass seed and anti-erosion fencing on commercial projects throughout Georgia.  A developer was developing a commercial tract of real estate with a big-box anchor and multiple out-parcels in Cornelia, Georgia in Habersham County.  The developer entered into a construction contract with a large Georgia prime contractor; one of the terms of the construction contract required that the general contractor provide payment and performance bonds on the work.  The performance bond, of course, protected the project owner’s interests whereas the payment bond protected the subcontractors, sub-subcontractors and material suppliers working on the project.  The General Contractor hired a local grading contractor to, among other things, provide the sod and the erosion control on the Habersham County, Georgia construction project.  The grading contractor, in turn, entered into a sub-subcontract with our client to assist with a portion of the scope of its subcontract.

Georgia Notice to Owner/Notice to Contractor: The prime contractor duly filed a Notice of Commencement in the Habersham County, Georgia Courthouse in Clarkesville, Georgia; consequently (and, more particularly, since our was a third-tier subcontractor, they had to send a Notice to Owner and Notice to Contractor in order to preserve their subcontractor lien rights in Georgia and their right to file a claim against the payment bond claim (even with private project bonds).

Default on Payment: Our client performed all of its work under the sub-subcontract; however, after the work was done and the grass was growing, the grading contractor had to regrade the slope due to an error the grading contractor had made.  Although our client had not received their final payment yet, they agreed to return to the job site and replace the sod that the grading subcontractor destroyed.  By this time, however, it was the wrong time of the year to try and seed and replace the sod in Habersham County, Georgia so our client agreed to put additional erosion-control mechanisms on the project and to re-seed and re-sod when the weather conditions were more conducive.  Apparently, this aggravated the grading contractor who then refused to make the final payment to our client.

Georgia Claim of Lien / Payment Bond Claim: Our client understood that all materialmen’s liens in Georgia must be filed within 90 days of the last day in which they were physically on the project so they contacted us sometime around the 65th day after they were on the project.  They asked us to file a lien on their behalf for the balance they were due under the Georgia Mechanics & Materialmen’s Lien Act.  As a part of the lien, our construction lawyers generally attach a metes and bounds legal description of the real estate to be liened in order to make sure the claim of lien attaches to the real estate.  Thus, we began the lien-filing process by running a title search in Habersham County.  In the process of researching the title records, we located the Notice of Commencement which the prime contractor had filed at the Habersham County Courthouse.  Georgia lien laws require that the Notice of Commencement list the name and address of the payment bond company, if any.  In this case, the Habersham County Notice of Commencement included information on the payment bond company.  The payment bond required that our client make a claim within 90 days of the last day in which it had provided labor or materials on the job site.  Since our client was still within the deadline, we decided to file a claim of lien and file a payment bond claim.  Thus, we filed the materialmen’s lien at the Habersham County, Georgia Courthouse in Clarkesville and we sent the appropriate payment claim notice to the bonding company, project owner and prime contractor.

Legal Strategy: Georgia lien laws give a lien claimant up to one year to settle or negotiate its claim. Before the year end, however, the lien claimant must file a lawsuit to perfect its lien or lose its lien rights altogether; similarly, the payment bond required that suit must also be brought within one year.  In this case study, however, we decided to give the parties a few months to voluntarily make payment.  The project owner, a national retailer, was upset that the grading subcontractor had failed to make payments to its subs and suppliers and had caused a lien to be placed against their Habersham County, Georgia real estate; the prime contractor, similarly, was upset that the grading contractor had caused a supplier/sub-subcontractor to make a claim against its payment bond.  Thus, both of these parties exerted a great deal of pressure on the grading subcontractor to fulfill its obligation to our contractor.

Payment of the Lien Claim and the Payment Bond Claim: With both the project owner and the general contractor putting pressure on the grading contractor to resolve this payment issue, the grading contractor capitulated and paid our client in full.  We, in turn, cancelled the materialmen’s lien which had been filed in Habersham County, and we released our claim against the payment bond.

Results of Case Study:  The Cobb Law Group’s lien and bond lawyers used the opportunity to concurrently file a suppliers lien and make a payment bond claim which resulted in payment to our client.  Of course, these results may not be indicative of the results of every lien and bond claim in Georgia, but it is a very valuable reminder to always see if there is a payment bond covering your private construction project in Georgia.

Listed below is contact information for the Habersham County Clerk of Court for any questions you may have prior to contacting a lawyer (please note this information may change without notice):

Clerk of Court’s Physical Address:
Habersham County Superior Court Clerk
ATTN: Materialmen’s Lien Filing Desk
295 Llewellyn Street, Suite 110
Clarkesville, GA 30523

Clerk of Court’s Mailing Address:
Habersham County Superior Court Clerk
ATTN:  Materialmen’s Lien Filing Desk
P.O. Box 2320
Clarkesville, GA 30523

Clerk of Court’s Telephone Number:
(706) 839-0300


Mechanic’s Lien Filing Fees:
$5.00 for the first page and $2.00 for each additional page

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The information contained on this website is for information purposes only; you are directed to consult with your attorney regarding the risks involved in filing mechanics and materialmen’s liens as well as all other aspects of lien filing including, but not limited to proper forms, conditions precedent, legal descriptions, notice requirements, and the statutes of limitations.  Nothing contained herein creates an attorney-client relationship between the Cobb Law Group and you.  Furthermore, no warranties, expressed or implied, are provided for the data herein, its use or interpretation.  Please contact us for further information.