Lien Waivers: Show Me The Money!
AUGUST 4, 2017
The lien waiver statute O.C.G.A.§ 44-14-366(b)(2) provides that a lien can’t be waived unless: 1) a waiver and release form has been completed by the lien claimant (covered in the last blog entry); and 2) the lien claimant has been paid for the claim.
The question is what is defined as payment. . . .it may be a broader definition than you think!
What is payment under the statute?
Payment is considered to have occurred (and the lien therefore waived) at the earliest of 1) when payment is actually received; 2) when the lien claimant signs a written acknowledgment that they have been paid in full (not a lien waiver); or 3) 60 days after the execution of a waiver and release, unless before the 60 day period, the claimant files a claim of lien or files an affidavit of nonpayment in the county where the work is located. O.C.G.A.§ 44-14-366(f)(2).
Therefore, if a lien waiver is signed to induce payment (after the work is complete) and the payment promised is not made you must, in order to be able to maintain your lien claim you must, within 60 days after the date the lien waiver is signed, either file a claim of lien (assuming it is within the 90 day period) or file an “affidavit of nonpayment” in the county where the project is located. The affidavit of nonpayment must substantially follow the form set forth in O.C.G.A.§ 44-14-366 (f)(2)(c) in boldface capital letters in at least 12 point font.
If you are paid. . . .If the claimant is paid the amount owed after filing the affidavit of nonpayment, and a request is made, the claimant shall prepare an affidavit that they have been paid in full and shall file that affidavit in the county where the affidavit of nonpayment was filed.
Form Affidavit of Nonpayment:
AFFIDAVIT OF NONPAYMENT
UNDER O.C.G.A. SECTION 44-14-366
STATE OF GEORGIA
THE UNDERSIGNED MECHANIC AND/OR MATERIALMAN HAS BEEN EMPLOYED BY (NAME OF CONTRACTOR) TO FURNISH (DESCRIBE MATERIALS AND/OR LABOR) FOR THE CONSTRUCTION OFIMPROVEMENTS KNOWN AS (TITLE OF THE PROJECT OR BUILDING) WHICH IS LOCATED IN THE CITY OF______ , COUNTY OF ______________ , AND IS OWNED BY(NAME OF OWNER) AND MORE PARTICULARLY DESCRIBED AS FOLLOWS:
(DESCRIBE THE PROPERTY UPON WHICH THE IMPROVEMENTS WERE MADE BY USING EITHER A METES AND BOUNDS DESCRIPTION, THE LAND LOT DISTRICT, BLOCK AND LOT NUMBER, OR STREET ADDRESS OF THE PROJECT.)
PURSUANT TO O.C.G.A. SECTION 44-14-366 THE UNDERSIGNED EXECUTED A LIEN WAIVER AND RELEASE WITH RESPECT TO THIS PROPERTY DATED __________, ____. THE AMOUNT SET FORTH IN SAID WAIVER AND RELEASE ($ ) HAS NOT BEEN PAID, AND THE UNDERSIGNED HEREBY GIVES NOTICE OF SUCH NONPAYMENT.
THE ABOVE FACTS ARE SWORN TRUE AND CORRECT BY THE UNDERSIGNED, THIS _______DAY OF________,_____.
___________________________(SEAL) CLAIMANT'S SIGNATURE
SWORN TO AND EXECUTED IN THE PRESENCE OF:______________ (WITNESS)
WITHIN SEVEN DAYS OF FILING THIS AFFIDAVIT OF NONPAYMENT, THE FILING PARTY SHALL SEND A COPY OF THE AFFIDAVIT BY REGISTERED OR CERTIFIED MAIL OR STATUTORY OVERNIGHT DELIVERY TO THE OWNER OF THE PROPERTY. IF THE FILING PARTY IS NOT IN PRIVITY OF CONTRACT WITH THE PROPERTY OWNER AND A NOTICE OF COMMENCEMENT IS FILED FOR THE IMPROVEMENT ON THE PROPERTY FOR WHICH THE FILING PARTY'S LABOR, SERVICES, OR MATERIALS WERE FURNISHED, A COPY OF THE AFFIDAVIT SHALL BE SENT TO THE CONTRACTOR AT THE ADDRESS SHOWN ON THE NOTICE OF COMMENCEMENT.
WHENEVER THE OWNER OF THE PROPERTY IS AN ENTITY ON FILE WITH THE SECRETARY OF STATE'S CORPORATIONS DIVISION, SENDING A COPY OF THE LIEN TO THE COMPANY'S ADDRESS OR THE REGISTERED AGENT'S ADDRESS ON FILE WITH THE SECRETARY OF STATE SHALL BE DEEMED SUFFICIENT."