by John E. Taylor
Liens for unpaid water and sewer charges have the same priority against a property as do ad valorem tax liens. The problem for purchasers, lenders and title attorneys has been that these liens are effective without any notice, recorded or otherwise.
A water provider’s seeking to enforce payment or refusing to provide service (perhaps after closing of a transaction) might be the first indication of a problem.
Title insurers issuing commitments on Georgia properties (at least properties in the metropolitan Atlanta area) customarily include in their title commitments requirements for written confirmation from the water providers that no water bills are delinquent. The ease or complexity of obtaining that confirmation has varied among providers.
The Georgia General Assembly recently amended Section 36-60-17 of the Official Code of Georgia Annotated, effective July 1, 2016, to entitle a party or closing attorney to request a statement from the water supplier (public or private) of current and delinquent water charges. The request must be in writing, must include the property address and a return address, and must be delivered to the water supplier by certified mail, return receipt requested; by the United States Postal Service or company such as UPS or FedEx for delivery the next business day; or by email, if available. The water supplier must respond by one of the same delivery methods within 10 business days after receipt of the request and may charge a fee of not more than $10.00. Failure of the water supplier to provide the statement within the required period expunges any liens for unpaid water charges from the title acquired in the transaction and prevents the water supplier from denying water services to the new owner or tenant. The information specified in the water supplier's statement binds the water supplier for 30 days after the date of the statement. Payment in full within the 30 day period extinguishes any lien that the water supplier may have against the property. These requirements do not apply to condominium associations that supply water.
Practice Note: Closing attorneys should add water charge statements to their closing checklists and send the requests promptly after obtaining the necessary information. While recent experience suggests that at least some providers may respond more quickly, the attorney should send the request at least 11 business days before the contemplated closing date. The closing attorney should send another request upon delay of closing if the effectiveness of the statement from the water supplier lapses in the interim.
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