Contractors Submitting Lien Notices Within 90 days
Full Question:
Answer:
In Georgia, the lien must be filed within three (3) months of the last time the person or entity claiming the lien worked on the property or within three (3) months of the last time materials were delivered to or installed upon the property. OCGA Section 44-14-361.1(a)(2).
An automatic stay in bankruptcy proceedings immediately stops any lawsuit filed against the debtor and virtually all actions against their property by a creditor, collection agency or government entity. The bankruptcy code protects a laborer's right under applicable state law to
perform post-bankruptcy actions that are necessary to maintain or continue a mechanics’ lien if the generally applicable law provides that the rights of a contractor or supplier “relate back” in time and becomes superior to the rights of intervening lien creditors. A lien may still be enforced if there is a timely filing of a preliminary lien notice under state law in relation to when services or goods are provided to the debtor and relate back to the original date of when the work was
begun or the material was delivered.
The following is a GA statute:
44-14-361.1. (a) To make good the liens specified in paragraphs (1) through
(8) of....
(a) To make good the liens specified in paragraphs (1) through (8) of
subsection (a) of Code Section 44-14-361, they must be created and
declared in accordance with the following provisions, and on failure
of any of them the lien shall not be effective or enforceable:
(1) A substantial compliance by the party claiming the lien with his
contract for building, repairing, or improving; for architectural
services furnished; for registered forester services furnished or
performed; for registered land surveying or registered professional
engineering services furnished or performed; or for materials or
machinery furnished or set up;
(2) The filing for record of his claim of lien within three months
after the completion of the work, the furnishing of the architectural
services, or the furnishing or performing of such surveying or
engineering services or within three months after the material or
machinery is furnished in the office of the clerk of the superior court
of the county where the property is located, which claim shall be in
substance as follows:
"A.B., a mechanic, contractor, subcontractor, materialman, machinist,
manufacturer, registered architect, registered forester, registered
land surveyor, registered professional engineer, or other person (as
the case may be) claims a lien in the amount of (specify the amount
claimed) on the house, factory, mill, machinery, or railroad (as the
case may be) and the premises or real estate on which it is erected or
built, of CD.
(describing the houses, premises, real estate, or railroad), for
satisfaction of a claim which became due on (specify the date the
claim was due) for building, repairing, improving, or furnishing
material (or whatever the claim may be)."
At the time of filing for record of his claim of lien, the lien
claimant shall send a copy of the claim of lien by registered or
certified mail or statutory overnight delivery to the owner of the
property or the contractor, as the agent of the owner;
(3) The commencement of an action for the recovery of the amount of the
party's claim within 12 months from the time the same shall become due. In
addition, within 14 days after filing such action, the party claiming the
lien shall file a notice with the clerk of the superior court of the
county wherein the subject lien was filed. The notice shall contain a
caption referring to the then owner of the property against which the
lien was filed and referring to a deed or other recorded instrument in
the chain of title of the affected property. The notice shall be
executed, under oath, by the party claiming the lien or by such party's
attorney of record, but failure to execute the notice under oath shall be
an amendable defect which may be cured by the party claiming the lien or
by such party's attorney without leave of court at any time before entry
of the pretrial order and thereafter by leave of court. An amendment of
notice pursuant to this Code section shall relate back to the date of
filing of the notice. The notice shall identify the court wherein the
action is brought; the style and number of the action, including the
names of all parties thereto; the date of the filing of the action; and
the book and page number of the records of the county wherein the subject
lien is recorded in the same manner in which liens specified in Code
Section 44-14-361 are filed. The clerk of the superior court shall enter
on the subject lien so referred to the book and page on which the notice
is recorded and shall index such notice in the name of the then purported
owner as shown by the caption contained in such notice. A separate lis
pendens notice need not be filed with the commencement of this action; and
(4) In the event any contractor or subcontractor procuring material,
architect's services, registered forester's services, registered land
surveyor's services, or registered professional engineer's services,
labor, or supplies for the building, repairing, or improving of any real
estate, building, or other structure shall abscond or the or leave the
state within 12 months from the date such services, labor, supplies, or
material are furnished to him or her, so that personal jurisdiction
cannot be obtained on the contractor or subcontractor in an action for
the services, material, labor, or supplies, or if the contractor or
subcontractor shall be adjudicated a bankrupt, or if, after the filing of
an action, no final judgment can be obtained against him or her for the
value of such material, services, labor, or supplies because of his or
her death, adjudication in bankruptcy, or the contract between the party
claiming the lien and the contractor or subcontractor includes a
provision preventing payment to the claimant until after the contractor or
the subcontractor has received payment, then and in any of these events,
the person or persons furnishing material, services, labor, and supplies
shall be relieved of the necessity of filing an action or obtaining
judgment against the contractor or subcontractor as a prerequisite to
enforcing a lien against the property improved by the contractor or
subcontractor. Subject to Code Section 44-14-361, the person or persons
furnishing material, services, labor, and supplies may enforce the lien
directly against the property so improved in an action against the owner
thereof, if filed within 12 months from the time the lien becomes due,
with the judgment rendered in any such proceeding to be limited to a
judgment in rem against the property improved and to impose no personal
liability upon the owner of the property; provided, however, that in such
action for recovery, the owner of the real estate improved, who has paid
the agreed price or any part of same, may set up the payment in any
action brought and prove by competent and relevant evidence that the
payments were applied as provided by law, and no judgment shall be
rendered against the property improved. Within 14 days after filing such
action, the party claiming the lien shall file a notice with the clerk of
the superior court of the county wherein the subject lien was filed. The
notice shall contain a caption referring to the then owner of the
property against which the lien was filed and referring to a deed or other
recorded instrument in the chain of title of the affected property. The
notice shall be executed, under oath, by the party claiming the lien or
by his or her attorney of record. The notice shall identify the court
wherein the action is brought; the style and number of the action,
including the names of all parties thereto; the date of the filing of the
action; and the book and page number of the records of the county wherein
the subject lien is recorded in the same manner in which liens specified
in Code Section 44-14-361 are filed. The clerk of the superior court
shall enter on the subject lien so referred to the book and page on which
the notice is recorded and shall index such notice in the name of the
then purported owner as shown by the caption contained in such notice. A
separate lis pendens notice need not be filed with the commencement of
this action.
(b) As between themselves, the liens provided for in Code Section
44-14-361 shall rank according to the date filed; but all of the liens
mentioned in this Code section for repairs, building, or furnishing
materials or services, upon the same property, shall, as to each other,
be of the same date when declared and filed for record within three
months after the work is done or before that time.
(c) The liens specified in Code Section 44-14-361 shall be inferior to
liens for taxes, to the general and special liens of laborers, to the
general lien of landlords of rent when a distress warrant is issued
out and levied, to claims for purchase money due persons who have only
given bonds for titles, and to other general liens when actual notice
of the general lien of landlords and others has been communicated
before the work was done or materials or services furnished; but the
liens provided for in Code Section 44-14-361 shall be superior to all
other liens not excepted by this subsection.
(d) In any proceeding brought by any materialman, by any mechanic, by
any laborer, by any subcontractor, or by any mechanic of any sort
employed by any subcontractor or by any materialmen furnishing material
to any subcontractor, or by any laborer furnishing labor to any
subcontractor, to enforce such a lien, the contractor having a direct
contractual relationship with the subcontractor shall not be a necessary
party; but he may be made a party. In any proceedings brought by any
mechanic employed by any subcontractor, by any materialmen furnishing
material to any subcontractor, or by any laborer furnishing labor to any
subcontractor, the subcontractor shall not be a necessary party; but he
may be made a party. The contractor or subcontractor or both may
intervene in the proceedings at any time before judgment for the purpose
of resisting the establishment of the lien or of asserting against the
lienor any claim of the contractor or subcontractor growing out of or
related to the transaction upon which the asserted lien is based.
(e) In no event shall the aggregate amount of liens set up by Code
Section 44-14-361 exceed the contract price of the improvements made
or services performed.