New Changes Become Effective on March 31, 2009

The Georgia Legislature recently passed legislation making significant changes to the laws regarding mechanics and materialman’s liens. The new law (1) changes applicable filing deadlines; (2) modifies the current forms of interim and final lien waivers, affidavits of non-payment, and contests of lien; and (3) provides for the automatic expiration of mechanics and materialman’s liens. The changes go into effect on March 31, 2009. A summary of the major changes is as follows:

  • Statutory forms of lien documents. The new law slightly modifies the statutory forms of interim and final lien waivers, affidavits of non-payment, and contests of lien that should be used once the new law takes effect. The law provides that beginning on March 31, 2009, the new forms of interim and final lien waivers, affidavits of non-payment and contests of lien will be the only accepted forms and that any other forms will be invalid. The new forms are reprinted at the end of this Legal Alert.
  • Deadline to file a lien. Currently, a claimant must file a lien within three months after work is completed or materials or services are provided. Under the new legislation, a claimant will have 90 days after work is completed or materials or services are provided to file a lien. If the deadline falls on a Saturday or non-business day, the deadline will be automatically extended to the next business day.
  • Deadline to file a lien action. Under the current law, a claimant must file an action seeking collection on a lien within 12 months after work is completed or materials or services are provided. The revised legislation will give a claimant 365 days from the date the lien was filed to file a lien action. This lien action may be a lawsuit, a claim for binding arbitration or a proof of claim in a bankruptcy case.
  • Deadline to file a notice of commencement of lien action. A claimant currently has 14 days after a lien action is filed to file a notice of commencement. Under the new legislation, a claimant will have 30 days after a lien action is filed to file its notice.
  • Deadline to file an affidavit of non-payment. The time period in which to file an affidavit of non-payment currently is 30 days after a lien waiver has been signed. The new legislation extends this deadline to 60 days.
  • Automatic expiration of liens. Once the new law takes effect, it provides that if a notice of lien action is not filed within 395 days of the date that the lien is filed, then the lien will be voided automatically without further action by an owner or contractor. If an owner or contractor files a notice of contest of lien, a lien claimant will then have 90 days to file a lien action and notice of commencement of lien action, or the new law provides that the lien will be automatically voided.
  • Required claim of lien language. The new law provides that after the new changes become effective, a claim of lien must include the statement below in boldface print in at least 12 point font. The new law states that without this language, a claim of lien will be invalid.

“THIS CLAIM OF LIEN EXPIRES AND IS VOID 395 DAYS FROM THE DATE OF FILING OF THE CLAIM OF LIEN IF NO NOTICE OF COMMENCEMENT OF LIEN ACTION IS FILED IN THAT TIME PERIOD.”

Form of Interim and Final Lien Waivers, Affidavits of Non-payment, and Contests of Lien

Beginning March 31, 2009, the forms provided below should be used for all interim and final lien waivers, affidavits of non-payment, and contests of lien. All text must be in boldface capital letters in at least 12 point font.