In order to get paid, contractor is requiring a release of lien, but do not want them to record it until we get paid so I want to put "draft" on it.
1 reply
Dec 6, 2017
Inserting the word "draft" will likely have little or no effect on a form that is signed and purports to waive lien rights. In Georgia, the mechanics lien statute prescribes a specific form for a conditional lien waiver for the exact situation you described above - the lien waiver is only effective upon the receipt of funds. Under § 44-14-366(f)(1), "When a waiver and release provided for in this Code section is executed by the claimant, it shall be binding against the claimant for all purposes, subject only to payment in full of the amount set forth in the waiver and release." Payment will be considered to have come either when payment actually comes or upon a sworn statement by the waiving party attesting that payment has been made. However, it's important to note that 60 days after this conditional waiver is made, if no action is taken, the waiver effectively turns into an unconditional waiver. So, if lien rights are conditionally waived but payment hasn't come and the 60 day deadline is getting close, an unpaid claimant should file a claim of lien or an affidavit of nonpayment in the county in which the property is located.