TITLE 36 LOCAL GOVERNMENT

Chapter 91 information not found

ARTICLE 3 BONDS

36-91-93. Rights of persons protected by payment bond or security deposit; governmental entity not a party.

Every person entitled to the protection of the payment bond or security deposit required to be given who has not been paid in full for labor or material furnished in the prosecution of the work referred to in such bond or security deposit before the expiration of a period of 90 days after the day on which the last of the labor was done or performed by such person or the material or equipment or machinery was furnished or supplied by such person for which such claim is made, or when he or she has completed his or her subcontract for which claim is made, shall have the right to bring an action on such payment bond or security deposit for the amount, or the balance thereof, unpaid at the time of the commencement of such action and to prosecute such action to final execution and judgment for the sum or sums due such person; provided, however, that:
1. Any person having a direct contractual relationship with a subcontractor but no contractual relationship, express or implied, with the contractor furnishing such payment bond or security deposit on a public works construction project where the contractor has not complied with the notice of commencement requirements shall have the right of action upon the payment bond or security deposit upon giving written notice to the contractor within 90 days from the day on which such person did or performed the last of the labor or furnished the last of the material or machinery or equipment for which such claim is made, stating with substantial accuracy the amount claimed and the name of the party to whom the material was furnished or supplied or for whom the labor was performed or done. The notice to the contractor may be served by registered or certified mail, postage prepaid, or statutory overnight delivery, duly addressed to the contractor, at any place at which the contractor maintains an office or conducts his or her business or at his or her residence, by depositing such notice in any post office or branch post office or any letter box under the control of the United States Postal Service; alternatively, notice may be served in any manner in which the sheriffs of this state are authorized by law to serve summons or process; and
2. Any person having a direct contractual relationship with a subcontractor but no contractual relationship, express or implied, with the contractor furnishing such payment bond or security deposit on a public works construction project where the contractor has complied with the notice of commencement requirements in accordance with subsection (a) of Code Section 36-91-92 shall have the right of action on the payment bond or security deposit, provided that such person shall, within 30 days from the filing of the notice of commencement or 30 days following the first delivery of labor, material, machinery, or equipment, whichever is later, give to the contractor a written notice setting forth:
  1. The name, address, and telephone number of the person providing labor, material, machinery, or equipment;
  2. The name and address of each person at whose instance the labor, material, machinery, or equipment is being furnished;
  3. The name and the location of the public works construction site; and
  4. A description of the labor, material, machinery, or equipment being provided and, if known, the contract price or anticipated value of the labor, material, machinery, or equipment to be provided or the amount claimed to be due, if any.
Nothing contained in this Code section shall limit the right of action of a person entitled to the protection of the payment bond or security deposit required to be given pursuant to this article to the 90 day period following the day on which such person did or performed the last of the labor or furnished the last of the material or machinery or equipment for which such claim is made.
Every action instituted under this Code section shall be brought in the name of the claimant without making the governmental entity for which the work was done or was to be done a party to such action.

(Code 1981, §36-91-73, enacted by Ga. L. 2000, p. 498, § 1; Code 1981, §36-91-93, as redesignated by Ga. L. 2001, p. 820, § 12.)

JUDICIAL DECISIONS

Bond precluded bankruptcy trustee from avoiding transfer.

- Subcontractor, that received a transfer of funds by or on behalf of the debtor as the general contractor, argued the subcontractor's potential claim under O.C.G.A. § 36-91-93 of the Georgia Little Miller Act against the payment bond precluded the bankruptcy trustee from avoiding the transfer as a preference under 11 U.S.C. § 547, as constituting contemporaneous new value. The subcontractor also argued the funds were held in constructive trust, were earmarked, or were paid in the ordinary course of business. Watts v. Pride Util. Constr., Inc. (In re Sudco, Inc.), Bankr. (Bankr. N.D. Ga. Sept. 27, 2007).

Summary judgment improperly granted.

- In an action on a public works payment bond under O.C.G.A. §§ 36-91-92 and36-91-93, a trial court erred in granting summary judgment to a surety because a material issue of fact existed as to whether a general contractor complied with the notice of commencement requirements so as to fall under the provisions of O.C.G.A. § 36-91-93(a)(2), or whether the general contractor received a sub-subcontractor's request but failed to comply and thus fell under the provisions of O.C.G.A. § 36-91-93(a)(1). Southway Crane & Rigging v. Fed. Ins. Co., 294 Ga. App. 504, 669 S.E.2d 482 (2008).

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