• Georgia is an UNPAID BALANCE lien state.
• Georgia is a Notice of Commence State (NOC). A Notice of Commencement of Improvement is designed to provide a potential lien claimant with ready access to information necessary to the filing of a claim of lien.
  • A copy of the Notice of Commencement must be provided within 10 calendar days of the receipt of a written request or the notice to contractor provisions are inapplicable to the claimant making the request.
  • NACM strongly recommends requesting the NOC in conjunction with serving the Notice to Owner (NTO) within 30 days of first furnishing. If upon receipt of the NOC the ladder of supply information is different than the that originally served, resend the NTO with the updated information within 30 days of receipt of the NOC.
• Effective January 1, 2009, GA put in place a new statutory scheme for licensing general contractors and residential contractors. Although there are exemptions from these licensing requirements, those required to have a license will be denied the right to seek payment for work performed, or to file a claim of lien with respect to the work performed if they do not have the required general contractor's or residential contractor's license. However, the lien rights of trade subcontractors and suppliers are not affected by a general contractor's failure to have the proper license.

Notice Speed Bumps

• Important Reminder: Claim amounts are required on all statutorily required NTOs.
• A lien claimant may file a preliminary notice of lien rights. If a preliminary notice is filed, then a subsequent contractor’s or owner’s affidavit that the claimant has been paid or has waived its lien rights will not dissolve the lien.
• If, after preliminary notice is filed, the owner or contractor demands that a claim of lien be filed, then the claimant must file a claim of lien within 10 days of the mailing of the demand, or preliminary notice is dissolved.

Mechanic’s Lien Speed Bumps

• Although a unlicensed trade contractor may file a claim of lien, it may be prohibited from filing suit to enforce its claim of lien unless it corrects its licensing problems.
• Lien amounts cannot include attorney's fees or other similar expenses, but these can be paid in the event that a party successfully prevails in a suit to foreclose on a lien.
• When the claim of lien has been filed, the lien claimant is required to send a copy of the lien claim by registered or certified mail or by statutory overnight delivery to the Owner of the property. The Lien must be served within 2 business days of the filing of the claim of lien.

Foreclosure Speed Bumps

• Pursuant to the foreclosure: The date the claim “became due” is defined as the last day on which materials were furnished or labor provided, irrespective of the fact that the contract payment terms may specify a different and later payment deadline i.e. 30 days.
• Lien claimants have 365 days from the date on which the lien was filed to file suit against the debtor to initiate a lien foreclosure action. Claimants can also file foreclosure actions against owners as well, so long as the claimant did not provide their services or materials directly to the property owner and as long as they've filed an action against the main debtor within the 365 days following the filing of a lien. Foreclosure suits against owners have the same 365-day timeline as well.

• If a payment bond or security deposit is not taken in the manner and form required in the GA statute, the corporation or body for which work is done under the contract shall be liable to all subcontractors and to all persons supplying labor, materials, machinery, or equipment to the contractor or subcontractor there under for any loss resulting to them from such failure.
• The contractor furnishing the payment bond or security deposit shall post on the public works construction site and file with the clerk of the superior court in the county in which the site is located a notice of commencement no later than 15 days after the contractor physically commences work on the project and supply a copy of the notice of commencement to any subcontractor, materialman, or person who makes a written request of the contractor.
  • Failure to supply a copy of the notice of commencement within 10 calendar days of receipt of the written request from such subcontractor, materialman, or person shall render the provisions of paragraph (1) of subsection (a) of Code Section 13-10-63 (Notice to Owner) inapplicable to such subcontractor, materialman, or person making the request.