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Posts Tagged ‘Georgia’

Georgia Legislature Resolves Glaring Issue with Mechanic’s Lien Law

Posted on: June 11th, 2021

By: Shaun Foley

In Georgia, anyone who furnishes labor, materials, or professional services for the improvement of private property has the right to file a mechanic’s lien. Liens are especially useful for contractors who do not receive payment after work is performed because filing one provides them with a security interest in the property. This is often more effective in helping to secure payment than a traditional lawsuit can be. In practice, perfecting a lien is seen by contractors as protection in addition to a right to file a breach of contract claim. You can always just file a lawsuit if you attempt to use lien laws and that doesn’t work out, right?

To answer that question, one must first understand that while there are a lot of avenues attorneys can take to fix a mistake (usually some form of paperwork and a court filing), Georgia lien law is unforgiving. Simply stated, this area of law is historically strictly construed, and your lien rights die if a mistake, no matter how minor, is made.

Lien waivers are documents that put the relevant parties on notice that an entity is giving up the right to file a lien in exchange for payment. These are common instruments used amongst owners and their general contractors (and their subcontractors). Georgia is one of 12 states that requires a specific form and, in fact, if a form used on the job site does not conform with the statutory form, the waivers are invalid. Further, if a contractor executes one and is not paid within 90 days[1], they must file an Affidavit of Nonpayment or, prior to 2021, file their lien claim. If 90 days passes from execution of the waiver without the filing of an Affidavit, your claim of lien dies and hence the discussion above regarding the unforgiving nature of lien law. So, I am an electrical contractor for a large development and the owner has asked the General Contractor that I execute a lien waiver. I do so, but I was not paid, and I failed to file an Affidavit of Nonpayment. On to breach of contract then, right? Wrong.

It is not a stretch to say that most if  not all members of the construction industry (owners, general contractors, subcontractors, suppliers, etc.)  would have assumed that lien waivers were applicable only to liens and not to a party’s ability or inability to sue for breach of contract. However, it turns out that Georgia’s statutory lien waivers were waiving more than just lien rights; they were waiving a contractor’s ability to sue in state courts as well. There were several simultaneous cases concerning this exact issue making its way through Georgia courts before ALA Construction Services, LLC v. Controlled Access, Inc., 351 Ga. App. 841 833 S.E.2d 570 (2019) received the case and concluded that “…the plain and unambiguous language of OCGA § 44-14-366 (f) (1) clearly provides that the General Assembly intended the Waiver to be binding against the parties for “all purposes,” not just for the purposes of preserving the right to file a lien on the property. OCGA § 44-14-366 (f) (1) (the execution of a waiver and release under this Code section “shall be binding against the claimant for all purposes”)”. It is hard to argue with the Court electing to utilize the plan and unambiguous language analysis because the statute does say what it says, but from an equity standpoint, ALA was heard loud and clear by those in the Georgia construction legal space and their connections and colleagues in the Georgia legislature. Many construction lawyers believed the Court missed the mark in terms of the purpose of the statute.

Georgia Senate Bill 315 was a direct response to the Court’s decision in ALA and as of 2021 is now in effect. The first section of O.C.G.A. §44-14-366 will now read: “Waivers and releases provided for under this Code section shall be limited to waivers and releases of lien and labor or material bond rights and shall not be deemed to affect any other rights or remedies of the claimant.”

Now, should a contractor execute a lien waiver and fail to file an affidavit of non-payment, it will still be able to bring a breach of contract action against the proper party.

For more information contact Shaun Foley at [email protected]

[1] This requirement is also new pursuant to the law change. The time frame was 60 days prior to the enactment.

Georgia Federal Court Among the First to Restrict Applicability of Georgia COVID Emergency Orders Extending Statutes of Limitations

Posted on: June 4th, 2021

By: Wayne Melnick and Carlos Fernandez

The COVID-19 pandemic slowed the roll of most, if not all, cases. Now that the brakes are being slowly eased-off, questions are arising about the Georgia Supreme Court’s Emergency Orders that extended the statute of limitations deadlines. A new case from the Middle District of Georgia interpreted the Emergency Orders finding the 122-day stay of statutes of limitations only applied to cases whose limitations deadline fell during that 122-day period.  As a result, the Court dismissed the plaintiff’s case as barred by the statute of limitations.

On November 1, 2018, the plaintiff was cleaning a machine when it suddenly restarted, and the blades mangled his left hand. Plaintiff timely filed suit against one party and then after the statute of limitations ran, without objection and with the Court’s leave, the plaintiff filed his Amended Complaint on January 19, 2021 naming a new party defendant.  In its motion to dismiss, the new defendant argued that the complaint could not be amended as the statute of limitations ran on November 1, 2020. Although the plaintiff argued that the Emergency Orders added 122 days to all statutes of limitations and the amended complaint was filed within 122 days of the expiration of the limitation, the District Court disagreed, finding the Emergency Orders did not grant a 122-day bonus extension to all cases, but rather only applied to deadlines that ran in the period between March 14 through July 14, 2020.  Determining that the Emergency Orders only applied to extend time for cases whose statute of limitations ran during that 122-day period, the Court held it was “simply unreasonable” to grant every plaintiff an extension regardless of when their statute of limitations ran.

This ruling is important for all attorneys and claims representatives handling claims and cases in Georgia. Now, at least one court has made clear that not all claims or cases may benefit from the 122 extra days provided by the Emergency Orders. Rather, those Emergency Orders only apply to cases whose deadlines fell within that time period.  Defense attorneys should be mindful of this ruling and seek to dismiss any case attempting to take advantage of these Emergency Orders when otherwise not entitled.  We will continue to monitor developments and rulings related to the interpretation of the Emergency Orders as we expect this ruling to be appealed.

Update: June 21, 2021 – On June 6, 2021, the order in this case was vacated because the parties stipulated to substitute the relevant parties from the Motion to Dismiss. While this order can no longer be relied on as authority, it should also be looked at as a measuring stick for the Middle District of Georgia’s, and potentially other districts, outlook on adding 122 days to all statute of limitation deadlines. Most importantly, the rationale presented in the order is still valid and practitioners should consider advancing the same arguments if the proper case presents itself.

If you would like a copy of this case, Owens v. Perdue Farms, Inc., please contact Wayne S. Melnick at [email protected] or Carlos A. Fernandez at [email protected] directly.

One Man’s Trash: Georgia Court of Appeals Weighs in on Respondeat Superior Following Homeowner’s Altercation with Garbage Employee in Advanced Disposal Servs. Atlanta v. Marczak

Posted on: April 28th, 2021

By: Steven Grunberg

Do you ever feel like your dedication to your job is questioned? For one employee of a garbage and recycling disposal company there is little doubt surrounding the answer to this question. In March 2018, Lorenzo Bucknor was driving an Advanced Disposal Services Atlanta, LLC (“ADS”) recycling truck when he arrived at Mark Marczak’s home to retrieve Marczak’s curbside recycling. Just before Bucknor’s arrival, Marczak had placed his recycling bin on the curb of his home and placed an extra bag of recyclables on top of the bin. Prior to Bucknor stopping at Marczak’s home, the extra bag had flown off onto Marczak’s driveway where it remained.

When Bucknor pulled up in his ADS truck he collected the recyclables from Marczak’s bin but did not pick up the loose bag in the driveway as he did not consider them to be “curbside” and were not in the appropriate location for pickup. Marczak noticed the bag lying in the driveway and approached Bucknor, with bag in hand he said, “[t]his goes too,” and tossed the bag in Bucknor’s direction while Bucknor was emptying a bin at a neighboring home. Bucknor cursed at Marczak, left the bag on the ground, and returned to his truck. Marczak followed Bucknor to his truck, stating “[n]o, you take it, it’s your job,” and threw the bag into the driver’s side of the truck cab. Bucknor then jumped out of the truck and punched Marczak in the face before getting back into the cab, but immediately returned to Marczak and proceeded to strike Marczak several more times until he was lying unconscious and face-down on the driveway. Marczak and his wife sued Bucknor and ADS under the theory of respondeat superior, among others. Advanced Disposal Servs. Atlanta v. Marczak, No. A21A0180, A21A0181, 2021 Ga. App. LEXIS 191 (Ga. Ct. App. Apr. 8, 2021). The trial court denied summary judgment for ADS as to the respondeat superior claim.

On the surface, it may come as a surprise that the Marczaks’ respondeat superior claim survived summary judgment. After all, a recycling truck driver beating a customer unconscious appears to be “for reasons unrelated to that employment (e.g., for purely personal reasons disconnected from the authorized business of the master[.])” According to the court of appeals, Bucknor was clearly carrying out his duties as a ADS employee when he first encountered Marczak and the initial decision to punch Marczak was a personal reaction to having a recycling bag tossed into his cabin. However, the critical fact allowing the Marczaks’ respondeat superior claim to move forward was Bucknor’s response when asked why he re-engaged after the initial punch:  “I had got out [of the truck] initially and, you know, I had — because he hit me, so I hit him, so now he’s walking away, so — and I’m in the area, I’ve got to finish this whole neighborhood, so I was thinking that he, I don’t know, was going to get a weapon or something, honestly, and follow me or something. So yeah, I still felt like I was in danger. He’s at home, you know, and I don’t know what he’s going to get.” The court held this testimony raised “a question of fact as to whether Bucknor’s actions were purely personal or connected, at least to some extent, with his effort to finish his recycling route.” Even if beating Marczak unconscious was motivated by personal malice, Bucknor’s response, according to the court, was enough to allow a jury to conclude that he acted “within the scope of [ADS’s] business and in furtherance of its interests.”

Employers should be aware that an employee’s testimony may end up slotting their conduct, beatings included, within the scope and in furtherance of its business. Simply because an employee’s conduct is personally motivated, this alone may not absolve his employer of liability under respondeat superior.

For more information about this topic, please contact Steven Grunberg at [email protected].

Georgia’s New Elections Law May Have Effects For Local Governments

Posted on: April 15th, 2021

By:  William J. Linkous, III

Georgia’s new elections law, which has been widely reported upon nationally, passed the Georgia General Assembly during the 2021 session and was signed into law by Georgia Governor Brian Kemp near the end of March.  The 95-page revision may significantly affect the operations of local governments, which are often tasked with handling elections and registrations through their election superintendents, boards of registrars, boards of elections, or boards of elections and registration.

Some provisions of the new law will impact the budgeting of local governments.  Section 18 of the new law provides that in jurisdictions with 2,000 or more electors, if electors have to wait for an hour or more in line on election day, elections superintendents must reduce the size of the precinct or utilize more equipment (or both) in the next election, thus increasing elections expenses for local governments in the future.  Sections 9 and 14 of the new law prohibit elections superintendents and boards of registrations from taking any funding, grants, or gifts except from the local government, State, or Federal Government.  These provisions will impact the elections budgets of some jurisdictions that received large private grants for their election operations during the most recent elections, thus defraying costs to the local government.  Section 26 of the new law requires each board of registrars or absentee ballot clerk to establish at least one drop box as a means for absentee by mail electors to deliver their ballots.  Of course, the law allows more drop boxes to be used, up to prescribed limits.  The drop boxes can only be placed in locations with adequate lighting, constant surveillance by officials, anti-tampering measures, and daily collection of ballots by a team of two workers who meet certain qualifications.  In some jurisdictions, the drop box requirement may require a budget increase.

The expansion of early voting in most Georgia locations may also affect local government budgets.  There will be at least seventeen days of early voting under the new law, including two Saturdays and the option of offering voting on Sundays as well.  The budgets of rural local governments may be more heavily impacted by this expansion because staffing will be needed for at least two Saturdays, whereas most urban counties already utilize two Saturdays for early voting.

Some of the provisions of the new law provide for increased scrutiny and accountability for elections officials.  Section 6 of the new law allows the State Elections Board to suspend county or municipal superintendents and appoint replacements.  Under Sections 7 and 12 a governing authority of a county or municipality can request a performance review or an investigation into the actions of the local superintendent or board, and the State Elections Board can also initiate a review or investigation itself.  The extensive investigation and hearing process can result in a suspension with pay of a superintendent or board member, or even in their permanent removal.  The State Board of Elections can appoint a replacement for the official during the suspension, but the law is unclear who pays the replacement.  Local governments will be wise to closely review the operations of their elections and registrations divisions because of this added scrutiny.

Numerous provisions also change the administration of registrations and elections.  Some are subtle.  For instance, Section 11 allows poll officers to be permitted to serve in adjoining counties in some instances.  Sections 15 and 16 contain subtle changes to the method for challenging registrars and electors, including the removal of limits on the number of challenges that can be made by an elector which by itself could impact operations.  Section 20 restricts the types of places that can be utilized for advance voting locations.  Section 23 requires that ballots be printed on security paper to authenticate them.  Some of the less subtle changes in the administration of registration and elections under the new law include the fact that absentee ballot applications and ballots are primarily verified under the new law by name, date of birth, address, and driver’s license number, last four digits of one’s social security number, or other identification number, rather than verified by signature as in the past.  The new law also shortens the timeline for requesting and returning ballots.  Electors may request ballots 78 days before an election (as opposed to 180 days) and ballot applications must be received by the clerk no later than eleven days prior to the election, which is earlier than under the previous law.  Finally, the law also abbreviates the runoff period by requiring that a runoff be held 28 days after the initial election.   These administrative changes will require careful analysis by local governments of their election and registration operations.

For more information about this topic, please contact William Linkous at [email protected].

Extension Of COVID-19 Liability Protections For Georgia Businesses May Be On The Horizon

Posted on: March 9th, 2021

By: Aaron Miller

The Georgia House voted 99-68 in favor of House Bill 112 on February 9th, 2021, sending the bill to the Georgia Senate. The bill, which extends liability protections granted to local businesses under the Georgia COVID-19 Pandemic Business Safety Act an additional year, will now need to pass the Senate as well. Should House Bill 112 pass the Georgia Senate and be signed by Governor Brian Kemp, it would provide liability protections to local businesses against negligence claims alleging infection or exposure to COVID-19 while inside the business until July 14, 2022. A summary of the Act’s provisions was discussed in a prior blog and can be found here.

This is an interesting step taken by the Georgia House, as COVID-19 cases have been on the decline and the number of vaccinated individuals rises each day. There has been significant concern about future litigation involving infection of COVID-19, and while cases have already been filed, it remains to be seen what position the law will inevitably take on them.

If the extension of the Act does not ultimately pass, the viability of negligence claims related to Covid-19 exposure is uncertain. As required by law, in order to be successful on a tort claim, a plaintiff must prove that the defendant had a duty to the plaintiff, that the defendant breached such duty, and that the breach of the duty caused the plaintiff’s damages.  In the context of COVID-19, a plaintiff would likely have an uphill battle proving that their infection was the result of any particular business, as the incubation period for COVID-19 can range anywhere from 2-14 days. Additionally, as we are now a year into the pandemic, it is widely known how COVID-19 is spread and that there can be severe health consequences as a result of exposure, and a plaintiff would likely be met with a strong assumption of the risk defense. Businesses may be in a better position to avail themselves of this defense by providing or posting warnings similar to the statutory warnings set forth in the Act.

Regardless if the Act is extended, as it does not provide absolute immunity from COVID-19 claims, businesses open to the public need to take steps to reduce their liability exposure, including complying with local and federal guidance from government agencies like the Centers for Disease Control and Prevention (CDC). There is little doubt that such steps would be a defense to any litigation against a business for COVID-19 exposure.

Litigation involving COVID-19 exposure, despite any immunity passed into law, will be an ever-evolving area of law for the next several years. It remains to be seen how the law will react long term to such litigation. The Georgia legislature, however, is at least attempting to limit some of the uncertainty and the scope of potential liability. Should you have any questions regarding your business’ potential liability exposure, please reach out to the author by email at [email protected].