Article by Stephanie Friese and Gina Vitiello on “After Surprise Appeals Court Ruling, Governor Signs Bill Restoring Builders' View of Contractors' Liens”
In an article published on September 24, 2020 in The Daily Report, Atlanta-based Chamberlain Hrdlicka shareholders Stephanie Friese and Gina Vitiello discuss how the bill signed by Governor Kemp amends the Georgia Lien statute to restore the construction industry’s original understanding of Georgia mechanics’ and materialmen’s liens.
“The bill was passed in response to a 2019 decision of the Court of Appeals that held that contractors signing statutory lien waivers were releasing all legal claims to payments for the amounts included in the lien waivers, rather than releasing lien and bond rights only as to those amounts,” explain Friese and Vitiello. “The new law goes into effect on January 1, 2021.”
Friese and Vitiello further explain why this change in law is important to the construction industry. “Construction professionals have long understood lien waivers to be limited to a waiver of a claimant’s lien and bond rights. Contractors failing to file the affidavit of nonpayment or the claim of lien within the statutory period forfeited all of their claims to payment, including breach of contract claims.”
The authors discuss that between now and January 1, 2021, Friese and Vitiello discuss that the current lien law and the decision of ALA Construction Services are the controlling law. “Lien claimants need to be mindful of the current 60-day deadline for filing an affidavit of nonpayment or claim of lien to reserve rights to make claims for payments of amounts that have been “waived” in lien waivers.”
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