Lien waivers are recorded documents used to inform a property owner and any other interested parties that the person or firm with a potential mechanic's lien right is giving up the right to file that lien in exchange for full or partial payment. Use these documents carefully, because the right to a mechanic's lien is regarded as sacred in the realm on the construction world. Unlike most other states, Georgia takes a different approach to its lien waivers, declaring them void unless payment has been received. O.C.G.A. 44-14-366(b).

Georgia recognizes two major types of waivers: The Interim Waiver and Release upon Payment and the Waiver and Release upon Final Payment. O.C.G.A. 44-14-366. These two waivers also fit into the minor categories of being conditioned or not conditioned on actual receipt of payment (included a cleared check). The latter categories can have a tremendous effect on lien rights, as sending an unconditional waiver will waive the right to a lien regardless of confirmed payment.

In addition to requiring payment first, Georgia law prohibits preliminary waivers of lien rights before beginning the work: A right to claim a lien or to claim upon a bond may not be waived in advance of furnishing of labor, services, or materials. O.C.G.A. 44-14-366(a). Any purported waiver or release of lien or bond claim or of this Code section executed or made in advance of furnishing of labor, services, or materials is null, void, and unenforceable. Id.

The Interim Waiver and Release upon Payment is used when a claimant is requested to execute a waiver and release in exchange for or to induce payment other than final payment (such as a partial or progress payment). O.C.G.A. 44-14-366(c). Use it for an expected progress payment on the project, or any payment other than final payment. If the responsible party fails to pay after 60 days of executing this waiver, the contractor needs to file a claim for a mechanic's lien or affidavit of non-payment. O.C.G.A. 44-14-366(2).

The form identifies the parties, the location, the nature of the work, relevant dates, and the amount of payment.

This article is provided for informational purposes only and should not be relied upon as a substitute for the advice of an attorney. Please contact an attorney with questions about lien waivers or any other issues related to liens in Georgia.

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