2.2 Project Notices: Notice of Commencement, Notice to Contractor & Preliminary Notice

2.2 Project Notices: Notice of Commencement, Notice to Contractor & Preliminary Notice

Statutory Authority: O.C.G.A. § 44-14-361.3 (Preliminary Notice of Lien) and O.C.G.A. § 44-14-361.5 (Notice of Commencement and Notice to Contractor).

Georgia construction law utilizes a sophisticated system of project notices designed to balance two competing commercial interests: providing visibility and payment security to downstream subcontractors and suppliers, while protecting property owners and prime contractors from surprise "hidden" liens and the catastrophe of double payment (paying the prime contractor in full, only to have unpaid second-tier subcontractors place liens on the property).

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1. Notice of Commencement (NOC) (O.C.G.A. § 44-14-361.5)

The Notice of Commencement (NOC) is the foundation of the Georgia project notice system. It establishes public record information about the project participants, property legal description, and payment security.

Filing Deadlines & Mandatory Procedures

• Who Files: The property owner, the owner's agent, or the general contractor (prime contractor) on the owner's behalf.
• Filing Deadline: Must be recorded with the Clerk of the Superior Court in the county where the real property is located no later than 15 calendar days after the physical commencement of work on the project site.
• Job Site Posting: A physical copy of the recorded NOC must be posted conspicuously at the construction site.
• Duty to Furnish Copies: Under O.C.G.A. § 44-14-361.5(d), the general contractor must provide a copy of the recorded NOC to any subcontractor, materialman, or supplier who sends a written request within 10 calendar days of receiving the request.

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|                        MANDATORY CONTENTS OF NOTICE OF COMMENCEMENT                     |
|                                  (O.C.G.A. § 44-14-361.5(b))                            |
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| 1. Name, address, and telephone number of the Contractor (General Contractor)           |
| 2. Name and address of the true Owner of the real estate                                |
| 3. Name and address of the person other than the Owner at whose instance work is done   |
| 4. Name and address of the Construction Lender / Financing Institution (if any)         |
| 5. Name and address of the Payment Bond Surety and Bond Number (if project is bonded)   |
| 6. Complete Legal Description of the real property being improved                       |
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Consequences of Failing to File or Post a Valid NOC

If the owner or contractor fails to record the NOC within 15 calendar days of starting work, fails to post it on the job site, or fails to provide a copy within 10 days of a written request:

• Downstream subcontractors and suppliers are completely excused from having to send a Notice to Contractor.
• Remote claimants retain full mechanics' lien rights without having to give preliminary notice to the prime contractor.

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2. Notice to Contractor (NTC) (O.C.G.A. § 44-14-361.5(a))

The Notice to Contractor (NTC) is the essential statutory response required from "remote claimants"—parties who do not have direct contractual privity with the general contractor (e.g., second-tier subcontractors, sub-subcontractors, and material suppliers to subcontractors).

Purpose of the NTC

Because the general contractor has no direct contract with second-tier trades or materialmen, the GC would otherwise have no way of knowing who is providing labor or materials on the site. The NTC alerts the GC to the claimant's presence and identity, enabling the GC to require lien waivers or joint checks before releasing funds to first-tier subcontractors.

Strict Deadlines for Serving the NTC

Under O.C.G.A. § 44-14-361.5(a), the remote claimant must serve the NTC on both the owner (or owner's agent) and the general contractor within the later of the following two dates:

1. Within 30 calendar days from the date the Notice of Commencement was filed for record; OR
2. Within 30 calendar days from the date the claimant first furnished labor, services, materials, or machinery to the project site.

NTC Deadline = Later of (NOC Recording Date + 30 Days) OR (Claimant's First Furnishing Date + 30 Days)

Mandatory Delivery Method

The NTC must be sent via registered or certified mail or statutory overnight delivery.

Required Contents of the NTC (O.C.G.A. § 44-14-361.5(c))

• Name, address, and phone number of the remote claimant;
• Name and address of the party at whose instance the work or materials are being provided (the hiring subcontractor);
• Name and location of the project listed on the NOC;
• Description of the labor, services, materials, or equipment being provided; and
• The anticipated contract price or value of goods/services to be furnished.

Effect of missing the NTC: On a private project with a timely, filed and posted Notice of Commencement, a remote claimant who was required to serve an NTC and fails to do so loses the lien right addressed by § 44-14-361.5. Analyze any payment-bond claim under the statute and bond governing that project rather than assuming every bond remedy is automatically identical.

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3. Preliminary Notice of Lien (O.C.G.A. § 44-14-361.3)

In addition to the NTC mechanism, Georgia provides an optional statutory device called the Preliminary Notice of Lien.

Key features:

• Optional, not a prerequisite: A claimant in the statutory categories may enforce a lien without filing this preliminary notice.
• Filing: File in the superior-court clerk's office for the county containing the property within 30 days after first delivering materials or providing labor or services.
• Service: Except for a contractor, the filer sends a copy within seven days to the named contractor or owner by registered or certified mail or statutory overnight delivery.
• Duration and demand: The notice is dissolved by written waiver, expiration of the ordinary lien-filing period, or the demand-and-cancellation procedure in § 44-14-361.4. A qualifying demand can require the claimant to file a claim of lien within ten days.
• Exam distinction: A Preliminary Notice of Lien Rights under § 44-14-361.3 is optional. It is not the same document as the Notice to Contractor required of certain remote claimants under § 44-14-361.5.

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4. Owner Protections Against Double Payment: The Contractor's Final Affidavit

A primary policy objective of Georgia lien law is shielding innocent property owners from having to pay twice for the same construction work.

The Double Payment Dilemma

Imagine an owner pays the general contractor $500,000 in full. The general contractor goes bankrupt without paying the electrical subcontractor $60,000. Under common law, the electrical subcontractor could lien the owner's building, forcing the owner to pay $60,000 a second time to clear title.

Statutory Solution: Contractor's Final Affidavit of Payment

Under O.C.G.A. § 44-14-361.2, lien rights are dissolved when the owner has obtained the contractor's sworn statement that the agreed price or reasonable value has been paid and all suppliers and laborers have been paid, or are listed as unpaid, and the statutory transaction occurs without any valid preliminary notice or claim of lien of record. The protected transaction is a sale or loan by the owner or a final disbursement by a lender. This rule does not make a Notice of Commencement an independent condition of the affidavit protection.

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|                       HOW GEORGIA PREVENTS DOUBLE PAYMENT                               |
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| 1. Contractor gives the owner the sworn statement required by § 44-14-361.2             |
| 2. Statement confirms the agreed price/value and downstream payment status               |
| 3. No valid preliminary notice or claim of lien is recorded at the transaction            |
| 4. Owner sells or borrows, or lender makes final disbursement, without contrary notice    |
| 5. RESULT: Lien rights are dissolved to the extent the statutory conditions are met        |
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The sworn statement is therefore a transaction-protection device, not a substitute for evaluating every notice and recorded lien. When the statutory conditions are met, the affected lien rights are dissolved; an unpaid claimant may still have contract, bond, or other remedies that must be analyzed separately.