Not Filing a Notice of Commencement In Georgia
In Metromont Materials Corp. v. Cargill, Inc., 221 Ga. App. 853 (473 S.E.2d 498) (1996), Cargill contracted with Henschien, Johnson & Crombie of Georgia, Inc. (HJC) to build a plant on Cargill's property.
HJC contracted with Metromont to supply concrete for the project. HJC then assigned its contractor role to HJC-Georgia.
Metromont filed a claim of lien against Cargill's property because it was never paid for the concrete it supplied. Cargill filed an interpleader and declaratory judgment action against Metromont.
Metromont answered and cross-claimed against HJC-Georgia for the amount of the lien claim but did not file a notice of commencement.
When Metromont discovered that its lien was ineffective for failure to file the notice, it dismissed and refiled the cross-claim against HJC-Georgia and also filed a cross-claim against HJC, with the appropriate notices of commencement.
Georgia Court held that as of the date the notice requirement went unmet, the lien was extinguished and any action Metromont took to enforce the lien after the notice period expired was ineffectual. Id. at 855.
In reaching its decision, Georgia Court relied on Palmer, supra.
In Palmer, the lienholder filed suit against the account debtor under O.C.G.A. 44-14-361.1 (a) (3) but failed to file a notice of commencement.
The account debtor later declared bankruptcy, and the lienholder filed an in rem action against the improved property under O.C.G.A. 44-14-361.1 (a) (4).
The court held that at the time the lienholder failed to follow the statutory provision requiring filing of a notice of commencement, the lien became unenforceable and the subsequent filing of an in rem action "could not breathe new life into the extinguished right to a lien. . . ." 262 Ga. at 31 (2).