Following an adverse ruling in the Georgia Court of Appeals, over 20 organizations within the construction industry came together to revise Georgia’s, Lien Laws. Earlier this month, these revisions were signed into law by Gov. Kemp. This article identifies the highlights of the revisions.
As you may know, Governor Brian Kemp recently signed Senate Bill 315 into law revising and updating Georgia’s Lien Law Statutes. Since Mark Cobb was on the drafting committee for the new lien laws, we wanted to provide you with the highlights from the new law that was passed. The 2020 revisions to Georgia’s Lien Laws focus on changing O.C.G.A. § 44-14-344 which relates to waivers of liens.
- Georgia’s Lien Waivers are now expressly limited to waivers and releases of lien and labor or material bond rights and shall not be deemed to affect any other rights or remedies of the claimant; in other words, Georgia’s statutory lien waivers no longer impact the signatory’s contract rights;
- Georgia Lien Waivers are no longer required to be in boldface capital letters;
- Georgia’s Lien Waivers now clearly waive payment bond rights (as well as the right to file a materialmen’s lien);
- The names of the lien waivers have been changed as follows: Waiver and Release of Lien and Payment Bond Rights Upon Interim Payment (formerly known as Interim Waiver and Release Upon Payment); Waiver and Release of Lien and Payment Bond Rights Upon Final Payment (formerly known as Waiver and Release Upon Final Payment);
- The time in which the person executing the lien waivers has 90 days in which to file an Affidavit of Nonpayment in order to void the lien waiver (formerly, this was a 60 day time period);
- Affidavits of Non-Payment are no longer required to be in boldface capital letters;
- The new revisions will not take effect until January 1, 2021;
- The notice required in both the Interim Waiver and the Final Wavier has been changed to the following:
NOTICE: WHEN YOU EXECUTE AND SUBMIT THIS DOCUMENT, YOU
SHALL BE CONCLUSIVELY DEEMED TO HAVE WAIVED AND RELEASED ANY AND ALL LIENS AND CLAIMS OF LIENS UPON THE FOREGOING DESCRIBED PROPERTY AND ANY RIGHTS REGARDING ANY LABOR OR MATERIAL BOND REGARDING THE SAID PROPERTY TO THE EXTENT (AND ONLY TO THE EXTENT) SET FORTH ABOVE, EVEN IF YOU HAVE NOT ACTUALLY RECEIVED SUCH PAYMENT, 90 DAYS AFTER THE DATE STATED ABOVE UNLESS YOU FILE AN AFFIDAVIT OF NONPAYMENT PRIOR TO THE EXPIRATION OF SUCH 90 DAY PERIOD. THE FAILURE TO INCLUDE THIS NOTICE LANGUAGE ON THE FORM SHALL RENDER THE FORM UNENFORCEABLE AND INVALID AS A WAIVER AND RELEASE UNDER O.C.G.A. SECTION § 44-14-366.
The intent of this blog article is to help distill the revisions to our lien laws into practical, useful information. If you are interested to see all of the changes to Georgia’s Interim Waiver law, please review a copy of Senate Bill 315. By clicking this link, you will see a version of the new law with tracked changes.
As we approach the effective date of Georgia’s new Interim Waivers forms and new Final Waiver forms, the Cobb Law Group will make copies available through its website, its Facebook page, and our newsletter. In the meantime, please keep in mind the following warning:
WARNING REGARDING CURRENT LIEN WAIVERS: Since the changes to Georgia’s lien laws will not become effective until January 1, 2021, please remember that until that time the current lien waiver law remains in place. More importantly, it is important to remember that Georgia’s lien waivers (i) waive all rights to payments including contract claims and (ii) in order to void an existing lien waiver, an Affidavit of Payment must be filed within 60 days of the date of the lien wavier. Do not let any unpaid lien waivers go beyond the 60 days!
For additional detailed information on the Court of Appeals case which necessitated the 2020 Changes to Georgia’s Lien Law, you will find the following on our law firm’s website