As an Atlanta, business lawyer, I deal with non-competition (non-compete) and Non-Solicitation laws on a regular basis. The Atlanta Small Business Lawyers at The Libby Law Firm specialize in Georgia Contract Law for small to medium sized businesses. The Libby Law Firm is a well-known and well-respected Atlanta Law Firm. Our Firm represents a numerous small and medium sized businesses in an abundance of capacities. In this Blog, I analyze the “Georgia Restrictive Covenants Act”, which I believe will significantly change relationships between employers and employee in small and medium sized businesses. I believe this will be especially true in small to medium sized businesses and businesses that employ in specialty areas.

THE “GEORGIA RESTRICTIVE COVENANTS ACT” – THE “BLUE PENCIL” COMES OUT

I write this Blog as an Atlanta Attorney, to let you know a most recent change in Georgia Contract Law, which is bound to have a profound affect on Atlanta Small Business Employer – Employee relations. Georgia voters have favored a constitutional amendment on November 2nd, 2010, which speculated on stringent trade laws; thereby setting constraints on trade and its laws for workers in Georgia. The newly enabled law allows Georgia Courts to repair Restrictive (Non-Compete) Covenants in Georgia Contracts, which bind the employee. In the past, any illegality in the Georgia Restrictive Non-Compete Covenants would have caused the whole contract to fail.


To put it plainly, a fatally drafted Georgia Non-Compete clause or Non-Solicitation Clause drafted by an employer will be given effect as if it were drafted within the limits of the law. Thus, it alters already existing law, which previously rendered the entire restrictive covenant ineffective. This means if any of the restrictive covenants in the contract were unenforceable, whether because of geographical restrictions, scope of work restrictions, or time constraints, the whole contract will be held void ab initio. Now, the Judge can write in the restrictive covenants so that they are enforceable. This action is referred to as “blue penciling” and is tantamount to the judge correcting the contract so that the restrictive covenants are enforceable.

The new law is viewed as dubious, given the incongruity/discrepancy in the date of it being effective. While those who drafted the Georgia House Bill 173 declared that it would be enforced from November 3rd, 2010, the Georgia Constitution asserts that new laws should come into effect from the beginning of the coming year, January 1st. How this drafting error will affect anyone legally is uncertain and chances are that it may have to do the rounds of the courts to determine how it will be applied.

In its most practical aspect, what concerns those employees who intend to start a new business venture, is that; (a) An employment contract implemented before November 3rd, 2010, consisting of a restrictive covenant (a Georgia Non-Compete or Non-Solicitation Clause) will not be qualified for the new law; and, (b) Conversely, any employment contract implemented after November 3rd, 2010, with restrictive covenants; in particular, the restrictive covenants referred to as Non-Compete or Non-Solicitation Clauses, will fall under the new law. However, given the discrepancy in the dates, employment contracts may not be carry the power of this law as the date of commencement, or the new law may be held unconstitutional. This grey area in Georgia Contract Law may be of great concern to those workers aspiring to compete with their previous employers. This is particularly true in a densely populated competitive area such as Atlanta.
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As a construction lawyer in Atlanta and a homeowner, I am painfully aware that doing any form of modification to your home is not only time consuming but expensive as well. Stress builds up even more when things do not go according to plan, and Atlanta construction disputes brought by Georgia homeowners and Georgia construction contractors can ultimately lead to lawsuits and court time. To control the amount of construction cases going through the Georgia legal system, the Georgia Right to Repair Act became effective in 2004 to facilitate the settlement Georgia construction defect arbitration, disputes, lawsuits, litigation, and other construction issues outside of court. The following steps should be followed prior to filing a Georgia construction defect lawsuit or Georgia construction defect arbitration proceeding against a contractor in the State of Georgia.

Step 1: Homeowners Understanding Of The Georgia Right To Repair Act

Prior to beginning a home improvement project, Atlanta contractors are supposed to alert homeowners to what the Right to Repair Act states and what is required of both parties if the construction does not satisfy both pairings. As an Atlanta homeowner, it is necessary to do your research before you begin any home improvement project, so you are aware of your rights. Not following the Act correctly can result in a loss for you as well.

The news of the mildest winter on record in some time did not make me think of Kudzu bugs that were not killed off in severe frosts and cold weather. Instead, as an Atlanta construction lawyer, I thought that a mild winter could lead to a warmer than average spring, summer, and fall. The Atlanta construction attorney in me thought the formula: warm weather plus poor construction equals mold plus even slight dampness EQUALS MOLD!

In my Atlanta construction law firm, I handle mainly construction defects. However, the nature and type of defect vary. I have seen an increase in the number of cases that involve mold in newer homes. This seems to be more prevalent due to the boom in construction that occurred several years ago. Inevitably, with the passage of time problems are surfacing in these homes. In newer construction, mold is usually caused by a construction defect that falls within one of four categories. The first is design. Design defects occur when architects or engineers fail to follow code and design a sub-standard structure. Material defects are in the second category and involve the use of inferior or inappropriate building materials. Workmanship defects are in the third category and can include issues that arise from work by an inexperienced contractor or by a builder that knowingly cuts corners during construction. Subsurface defects are the fourth category and result from poor preparation of the soil on the property where the home is built.

Design, workmanship and material defects can be present in most areas of the home. Subsurface defects, on the other hand, mostly affect the building’s foundation. In the end, a compromised foundation can affect many parts of the home’s interior, such as bathroom tile surrounds, walls, ceilings and flooring. Issues in design, workmanship or material can cause defective tile work, but cracked tile may also be the result of a problem with the foundation or sub-floor. Regardless of the reason, broken tile and grout can allow moisture behind the tile face. This is when mold can gain a foothold. It is not always possible to visually confirm the presence of mold, so careful examination of all tile work is recommended, especially in bathrooms and areas with high water usage, such as kitchens and laundry rooms.

Construction defects can be costly to rectify and can negatively affect the value of a home and the ability to resell it (this is often called a diminution in value). Some of the more serious and difficult to fix issues stem from a defective home foundation. A home’s foundation can withstand hundreds of years of use if correctly constructed and usually can outlast the home built on top of it. However, if built poorly, a foundation can be the source of problems that threaten the stability of the home and, ultimately, the homeowner’s investment.

It is sad to know, that whether I am working in Sandy Springs as a “Sandy Springs Construction Home Defect Attorney,” the Buckhead Area as a “Buckhead Construction Home Defect Attorney,” in Fulton County as an Atlanta Construction Home Defect Attorney, in Gwinnett County as a Duluth or Lawrenceville Construction Home Defect Attorney, in Forsyth County as a Cumming Construction Home Defect Attorney, in Cobb County as an Acworth, Kennesaw or Marietta Construction Home Defect Attorney, and/or last but not least, in DeKalb County as a Decatur Construction Home Defect Attorney, the critical foundation problems I see in my Atlanta-Based Home Construction Defect Law Practice all stem from common defective construction that could have been prevented had the builder, contractor, or sub-contractor taken care in the construction of the home, and in particular, the foundation.

Unfortunately, these issues may not become known until several years after the building is complete. The result can be a nightmare scenario that leaves the homeowner unsure of what recourse is available under Georgia law. In many cases, by the time the defect is noticed, the builder or contractor responsible for the poor work usually denies that the foundation defects are their responsibility. For this reason, we also may engage various insurance companies to seek a remedy and relief for the homeowner in addition to pursuing the builder and contractor.

The foundation is especially critical because not only does it support the house, it also provides a moisture barrier that keeps the home dry and mold free. A solid foundation also insulates the home from cold and protects the home from damage caused by the ground shifting. Poured concrete reinforced by steel is thought by some experts to be a stronger material for foundations than concrete block or stone, and foundations can be built below ground on footings to provide a basement, or built as a slab. Regardless of the materials used to build the foundation, or its type of construction, all foundation types can fail for a variety of common reasons.

Improper initial site evaluation by the builder is one common cause of foundation issues. The first thing a builder must do when planning new construction is to evaluate the property’s soil type, water table, and grade. This will allow the builder to determine where to place the home on the property and what materials to use. Once that decision has been made, the soil preparation, process of laying the concrete and backfill used around the foundation all will affect the integrity of the foundation.

The foundation must be poured over solid ground that is prepared correctly, and compacted, so it does not settle and cause the foundation to crack. Properly leveling and packing crushed stone before pouring a slab, for example, will help prevent the slab from cracking. If the property contains any landfill material that may decompose over time, the soil must be reengineered to withstand the force of the foundation and the building. Additionally, concrete should be poured in one day to avoid creating a “cold joint” between fresh and semi-cured or cured concrete. This condition usually results in a cracked foundation that will leak. Concrete must also be allowed to cure slowly. Only by curing slowly will the concrete reach a strength that will support the weight of the house (around 3,000 pounds per square inch). Finally, the material used to backfill around the foundation will affect the longevity of the structure. Soils with a high clay or organic content absorb and hold water and can cause cracks in the foundation during freeze/thaw cycles when used as backfill.
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Yes, partnership nightmares are common. . . How common? Read on . . .

I have noticed many individuals are stepping away from their employment with large companies to start their own Georgia businesses. Some feel that the current economic situation has provided a golden opportunity that should be seized and others are forced to move on after being downsized by their companies. Often, these businesses are Georgia partnerships formed with friend, family and/or former work colleagues. Unfortunately, a great percentage of people begin these Georgia partnerships without the proper legal guidance or documentation based on Georgia’s partnership laws. Unwittingly, these would be business partners believe that long time personal relationships between partners, their own personal business knowledge, or other such reasons, will sufficiently protect their Georgia business partnership from internal strife, power struggles, and/or economic failure.

The fact is, even under ideal circumstances, Georgia partnerships are complex and should not be left unchecked. While partnership agreements do keep the “honest people honest,” they also stop abuse by others with less than honorable intentions. As an Atlanta Business Partnership Lawyer, I have handled many cases where even the best intentions between business partners could not stop Georgia partnership litigation from arising. In cases when the business entity does survive, the resulting chaos usually proves to be costly and detrimental to the business.

Thus, preventing Georgia partnership disputes is paramount. This involves retaining an experienced Georgia partnership attorney at the beginning of the partnership to construct a fair and manageable business relationship between partners. The next best thing to beginning a business relationship, in which a Georgia partnership lawyer skillfully guides you, is to catch a Georgia business partnership dispute before it gets serious in order to protect your interests. Usually, the first partner who realizes this and seeks legal guidance has the upper hand in the outcome of any Georgia partnership dispute, litigation, or dissolution.

Georgia partnership disputes can surface between and among anyone with an interest or influence on the company, including Georgia partnership shareholders and family members. Once disputes do arise, business partners are inclined to blame one another for any business failures. Common issues to address when a business is failing include whether or not to sell the company, employee retention, and company management. An experienced Georgia Business Partnership Attorney can help sort out these issues and provide the most beneficial solution to all involved.

The Georgia business partnership attorneys at The Libby Law Firm can assist you in determining and implementing solutions to resolve disagreements between partners, protect Georgia partnership interests, or effectuate partnership dissolutions. While litigation is the most common way Georgia partnership disputes are resolved, mediation or arbitration are also wise dispute resolution options. Other alternatives include buy-outs, settlements and distribution or sale of the business entity.
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As a construction attorney in Georgia Georgia construction law firm, I recognize that for most people, buying a home is one of the biggest investments they will ever make, so when construction defects are found in a new home or renovation project, the issue can be devastating both financially, emotionally, psychologically, and more. In fact, stress and financial hardship are commonplace for the homeowner burdened with a defective dwelling. Homeowners often lose money on their investment since the property is worth less because of the defects. Our Atlanta construction attorneys refer to this situation as diminution in value. A home with construction defects not only generates less money when sold, but also is much more difficult to sell. Inevitably, homeowners will spend additional time and money to rectify construction issues or lose money on their investment when they sell their home.

Especially true today, it is not uncommon for builders and contractors to find ways to save money on construction projects. . . . . AND, they do so at your (the Homeowner’s expense and detriment) . . .

Although being cost-conscious does not always result in construction defects, it can increase the likelihood of such occurrences. Additionally, many builders and contractors customarily use subcontractors to complete building projects. Subcontractors are found on most job sites, but the builder or contractor often completes their work with minimal supervision so the quality of their work frequently goes unchecked. Moreover, even in cases where the subcontractor cuts corners to save time or money on a construction project, any resulting defects are still the legal responsibility of the builder or contractor. This is even true when the subcontractor knowingly and purposely hides defects from the builder or contractor. The subcontractor will still be legally responsible as well.

Georgia construction law very clearly states that the builder or contractor is directly accountable for any material defects in the construction project, regardless of who completes the work at the site. Because there is legal recourse for homeowners who discover construction defects, it is wise to consult an experienced Georgia real estate construction lawyer as soon as a problem arises to ensure that your interests are represented. And while many homebuyers who discover defects in the construction of their homes only seek the advice of a Georgia construction attorney once the defects are noticed and legal action is required, it is possible to protect yourself before construction begins by having a qualified real estate construction attorney draft a solid Georgia construction contract or Georgia purchase/sale agreement that will better protect your investment.
https://www.duncanadamslaw.com/lawyer-attorney-1509150.html


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As an Atlanta, Georgia construction lawyer I stay very busy when I am preparing for a Georgia construction arbitration proceeding/hearing. Sometimes I have little contact with the outside world news. However, some matters do keep my attention in this upcoming election, such as healthcare reform, the estate tax debate, the “Buffet Rule”, and withdrawal of troops from Afghanistan — ending a long war. These changes are taking place on a national level and to some extent, a local level. It is my opinion that if the Republicans control Congress after the 2012 elections and President Obama is not re-elected, then much of President Obama’s attempted changes will be put to rest. Thus, it is understandable we are living in uncertain times wherein we do not know what or will not change. What will not change is Georgia construction law and the need to proactively protect your property/real estate interests from unscrupulous Georgia builders, contractors, and sub-contractors. Georgia construction defects will continue at a high rate as Georgia builders, Georgia general contractors, Georgia sub-contractors, and other Georgia building professionals try to cut corners to make ends meet and extend their profits. This is being done at the expense and hardship of Georgia homebuyers and new home purchasers.

Fortunately, under Georgia Construction Law, there are options to hold your Georgia builders, general contractors, and sub-contractors liable for their negligence, shoddy construction, construction defects, and more. Please read on and into my article discussing some of the issues a homeowner, buyer, or purchaser of a new home should be aware of to protect their home investment interests. I offer you the following:

In my Atlanta, Georgia construction law firm, all of the Atlanta, Georgia construction lawyers are sure that current Georgia construction law and Georgia construction defect problems (especially in big metro areas like Atlanta) are here to stay. Every building over time will see the results of wear and tear, but knowing whether the problem is an easy fix or a major reconstruction project needs to be determined before you buy. After all, construction defects can reduce the value of your property significantly. These defects can range from design issues to faulty systems to failure to meet Georgia industry building standards. Remember – not all construction defects are created equal. What may look like a simply crack in the ceiling could actually turn out to be a major architectural default or foundational defect.

Atlanta Business lawyers at The Libby Law Firm know that a Georgia corporation must be represented by an attorney in order for it to file a claim or to defend itself in a suit brought against it. This might seem like a heavy burden for a business––after all, an individual can represent him- or herself in court––so why must a corporation obtain representation instead of, say, being represented by the sole shareholder in court?

Although an individual can represent him- or herself in court––which is called “appearing pro se”––Georgia law prohibits a non-attorney from representing someone else in court. Corporations are considered to be and treated like an individual under law; therefore, permitting the shareholder to represent the corporation would be allowing the unauthorized practice of law because a non-attorney (the shareholder) would be representing another (the corporation) in court.

In fact, the Supreme Court of Georgia has held that:

Atlanta business lawyer Duncan H. Adams, notes that as an Atlanta, Georgia Business attorney, I have seen a change in the way business is conducted since the economy started to decline more than two years ago. The change is evident in heavily populated urban areas like Atlanta, but can also be seen across Georgia. The level of trepidation is palpable and business deals that used to be handled with a verbal agreement and a handshake now often require legal review and documentation.

Atlanta business lawyers believe the shift can be attributed to the struggle that most businesses are engaged in due to the poor global economic situation. This is especially true for small business in Georgia. Atlanta business lawyers on retainer or a phone call away are a must for small businesses in Georgia.

The economic climate has influenced the business community to become more ruthless. Many companies are enforcing contractual agreements strictly and not allowing for any leeway in interpretation or timing. The ability of a customer to pick up the phone and with a short call gain one-time forgiveness for a particular contractual term, like a payment deadline, is limited. Most companies are tightening their belts and putting profits before customer service and long-standing relationships.

Moreover, the state of the economy has encouraged a more serious and illegal type of bad behavior. Some business people are resorting to fraudulent activities or unfair business practices. These activities include, but are not limited to, false advertising, product misrepresentation and substandard quality resulting in known product defects. As the incidence of business failure increases, more business are resorting to these desperate measures. Because of this, even business dealings between close friends, relatives and long-time business partners are being scrutinized more closely.

Some of the types of matters we handle are as follows:

• Breach of contract claims

• Partnership disputes

• Corporate disputes

• Industrial or commercial lease disputes

• Minority shareholder oppression claims

• Insurance disputes

• Business purchase or sale agreements

Commercial litigation

Land use and zoning violations

• Enforcement of nondisclosure or non-compete covenants

• Fraud, misrepresentation, or material nondisclosure

• Enforcement of nondisclosure or non-compete covenants

• Officer and Director Liability

• Breach of fiduciary duty

• Theft of corporate opportunities

• Premise liability

Ownership disputes

Employment matters

Conversion by employees
Misappropriation of corporate assets

Corporate Theft

• Shareholder derivative lawsuits

• Breach of fiduciary duty

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As a residential and commercial construction arbitration lawyer in Atlanta, Georgia, I can assure you that most persons entering into a Georgia construction contract do not think of worst case scenarios should any parties to the contract fail to perform their obligations according to Georgia construction contract law and construction industry standards.

• What is Georgia Construction arbitration; Is it binding? How does it work?

• What will happens if a contracting party fails to pay?


• What happens if the purchaser of contractor or builder services cannot be satisfied no matter what is done?

• What will happen if the contractor or builder neglects his duties?


• What do I do if I receive a Georgia “Right to Repair Act” Letter?

• Do I need to, and should I, send a Georgia “Right to Repair Act” Letter?

• What will happen if residential or commercial construction does not meet or exceed industry standards?

The questions and scenarios surrounding Georgia construction claims are endless as are the actual real life occurrences, which I witness happening day in and day out. To survive in the construction business world, it is best to be prepared for all possibilities. The best way to do this is to have a contract in place which fairly, resourcefully, and adequately covers almost any issues which might arise in any Georgia construction claim scenario.

For years, Georgia construction litigation was considered the more costly, more time consuming manner of dealing with disputes, and so many contracts included arbitration clauses instead. Georgia construction arbitration has many varied forms and phases, which are its counterparts to Georgia litigation. It is usually up to the parties to an arbitration, with the assistance of the arbitrator or arbitration panel, to make the decisions about pre-arbitration matters which are somewhat customized to the construction case. The most important and controversial aspect to Georgia construction arbitration clauses are that they are binding decisions and cannot be appealed to any court absent extraordinary circumstances. Even then, they are rarely overturned by a court of competent jurisdiction, but merely modified. One might say the good news in all of this is that Georgia construction arbitration can be a relatively fast and inexpensive forum for resolving Georgia construction disputes.

However, others counter this argument stating that the cost of arbitration has skyrocketed while the time it takes for a case to make its way through Georgia state courts has diminished significantly.

Two California Supreme Court cases held that the courts cannot overturn a binding arbitration award even if the arbitrator fails to follow California substantive law. As a result, it becomes literally impossible to have an erroneous decision reviewed by the courts. While this is a California case, State Supreme Court holdings often have a strong influence on the courts in other states.

Needless to say, if you enter into a Georgia Contract with arbitration, you should consult a Georgia contract lawyer with expertise in arbitration and alternative dispute resolution. This is especially true if the contract you are entering is a Georgia construction contract for new home construction, a renovation contract, or contract for any similar building, structure creation, or like-kind services.

Formerly a typical arbitration clause in a construction contract might read as follows:

All claims or disputes between the contractor and the Owner arising out of or relating to the Contract Documents, or the breach thereof, shall be decided by arbitration in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association currently in effect unless the parties mutually agree otherwise. The award rendered by the arbitrator or arbitrators shall be final, and judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof.

– American Institute of Architects specifications (formA201) –

Due to the current trends in Georgia construction law and the arbitration process itself, as an Atlanta, Georgia construction lawyer with The Libby Law Firm, I would suggest incorporating certain additional considerations into arbitration clauses when used to give the parties to an arbitration greater control. For example,

Arbitration forum. The standard dispute resolution forum in the construction industry is the American Arbitration Association (AAA). However, recently, a number of other dispute resolution service providers (e.g. Judicial Arbitration and Mediation Service “JAMS”) have developed and many attorneys now prefer them over the AAA. The choice of an arbitration forum should be reviewed in context of the cost, arbitration panel members, and forum arbitration rules. Particular attention should be paid to the forum’s arbitration rules since they are incorporated into the arbitration clause. Though, the arbitration clause may include provisions that delete all or portions of the forum’s rules.

Discovery. Most arbitration clauses limit the scope of pre-arbitration discovery. A well-drafted arbitration clause will restrict or expand discovery to correlate to the dollar value of the dispute.

Standard for Court Review of the Award. An arbitration clause can be drafted to require the arbitrators’ decision to comply with the substantive law. If the arbitrator violates such a provision, the parties to the arbitration may seek to overturn the award since the arbitrator exceeded the authority granted under the arbitration contract clause. To ensure that a court has enough information to properly review the arbitrators’ award the arbitration clause should also require the arbitrators to render a well- reasoned opinion. The opinion should include a statement of the factual determination made by the arbitrators and the conclusions of law rendered by the arbitrator. Finally, if you want the decision to be reviewed by the courts for compliance with substantive law, a provision should be included in the clause that clearly states that desire.

The best method for ensuring that a Georgia construction dispute is correctly and fairly resolved is through situation-specific clauses in properly-drafted construction contracts. The arbitration clause is one of many clauses included in a typical construction contract, and each clause can be affected greatly by recent changes in the law. It is thus wise for any construction contract to be drafted or at least reviewed by counsel before signing.

The Libby Law Firm Georgia construction lawyers can negotiate, review, and draft your construction contract in light of all of the most recent changes in accordance to Georgia construction law and arbitration proceedings, which is most favorable to you. If you are considering entering into a construction contract or amending a previous contract in light of recent changes in the law, contact our Atlanta construction contract law firm and come in for a consultation. Seeking the assistance of a seasoned Atlanta, Georgia construction contract and arbitration lawyer adept is the least you can do to protect yourself from worst case scenarios.


As a well-known Georgia construction arbitration lawyer with a perfect Avvo rating of 10, I am here to tell you that if anything can go wrong in a construction contract or in construction, it will. The very nature, imperfection, and importance construction combined with the building a home or commercial structure readily lends itself to disputes and conflict. This is likely true because for many, a home is the biggest purchase you will ever make in your life. In addition, construction is not what it seems to be on paper. It is, by its nature, imperfect and the result and methods of construction are readily subjective.

In short, protect yourself because this construction is “big deal” to parties to the contract and maintains a high rate of conflict.

If you have legal dispute or binding arbitration with a contractor, builder, sub-contractor or architect whose work does not meet or exceed Georgia industry standards, you should contact The Libby Law Firm without delay.
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