On February 20, 2008, the Georgia Senate passed Senate Bill 374, which will become effective March 31, 2009. This Bill amends portions of Georgia’s mechanic’s lien statute, O.C.G.A. § 44-14-360, et al. Highlights of the changes to the statute include 

  • A change to the time frame in which to file a lien:
    • The amendment requires a claimant to file his claim of lien within 90 days (rather than 3 months) after the completion of the work.
    • Also, now a claimant has 2 days in which to send his claim of lien to the owner of the property after filing the lien. 
  • A change to the time frame in which to file suit to enforce a lien: 
    • The amendment requires a claimant to commence a lien action within 365 days from the date of filing the claim of lien – not from the time the amount of the lien “became due.”
  • A change to the language of the lien:
    • The statutory lien form has been modified such that liens filed after March 31, 2009, will now specify that the date the “claim became due” is “the same as the last date the labor, services, or materials were supplied to the premises.”
    • The lien form must also include the following statement in at least 12 point bold font: “This claim of lien expires and is void 365 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.” 
    • Failure to include the above language shall invalidate the lien and prevent it from being filed. 
  • Changes in the wording of lien waivers: 
    • The amendment requires all lien waiver forms to be in boldfaced capital letters in at least 12 point font. 
    • The new lien waiver forms must include the following statement: “NOTICE: WHEN YOU EXECUTE AND SUBMIT THIS DOCUMENT, YOU SHALL BE DEEMED TO HAVE BEEN PAID IN FULL THE AMOUNT STATED ABOVE, EVEN IF YOU HAVE NOT ACTUALLY RECEIVED PAYMENT, 60 DAYS AFTER THE DATE STATED ABOVE UNLESS YOU FILE EITHER AN AFFIDAVIT OF NONPAYMENT OR A CLAIM OF LIEN PRIOR TO THE EXPIRATION OF SUCH 60 DAY PERIOD. THE FAILURE TO INCLUDE THIS NOTICE LANGUAGE ON THE FACE OF THE FORM SHALL RENDER THE FORM UNENFORCEABLE AND INVALID AS A WAI VER AND RELEASE UNDER O.C.G.A. SECTION 44-14-366.” 
  • Changes for the Affidavits of Non-Payment: 
    • The affidavits must now also be in boldfaced capital letters in at least 12 point font. 
    • The affidavit must be filed if the contractor is not paid within 60 days of the date that the waiver form is executed, rather than the 30 days required by the prior version. 
    • New statutory language is required at the bottom of the statutory Affidavit of Non-Payment forms. 
    • Copies of the Affidavit must be sent by registered or certified mail or statutory overnight delivery to the owner, and to the contractor where a notice of commencement has been filed, within seven days of filing the Affidavit. 
  • Lien Discharge Bonds: 
    • The process for releasing a lien by filing of bond has also been amended. Beginning March 30, 2009, the party filing the bond shall send notice of filing such bond and a copy of the bond by registered or certified mail to the lien claimant within seven days of filing such bond. 
    • The failure to send the notice of filing the bond and copy of the bond does not invalidate the bond for purposes of discharge of a claim of lien. 
  • Notice of Contest of Lien: 
    •  In order to assist owners in removing clearly invalid liens, the legislature discarded the current method specified for removing such liens and replaced it with an entirely new accelerated process for challenging a lien’s validity. Under this new section, an owner may shorten the time for commencing a lien action by filing a Notice of Contest of Lien in the superior court clerk’s office. 
    • The Notice of Contest of Lien is a statutory form which must be in boldfaced capital letters in at least 12 point font.
    • The filing of this notice shortens the time within which a claimant may commence a lien action to 60 days from receipt of the notice. If the claimant fails to file an action within these 60 days, the lien will expire and be void.

For all our clients in the construction industry, the above changes represent a significant departure from the original statutory procedures.