How to collect unpaid invoices in Tennessee: lien rights, one-party consent, and General Sessions Court

Tennessee's wiretapping statute (T.C.A. §39-13-601(b)(5)) exempts from liability any person who is a party to a wire, oral, or electronic communication, or who has the prior consent of at least one party. The caller's own presence satisfies the one-party threshold. Tennessee businesses and AI tools collecting invoices on their behalf can record outbound calls without disclosing the recording to the customer. Disclosure at the call opening is good practice but is not required by Tennessee law.

Tennessee's mechanic's lien statute (T.C.A. §66-11-101 et seq.) protects contractors, subcontractors, and materialmen who furnish labor or materials to improve real property. The lien must be filed with the register of deeds in the county where the property is located within 90 days after the completion of the work or the last day labor or materials were furnished (T.C.A. §66-11-112). For a subcontractor who finished work on August 10, the lien filing deadline is November 8. Tennessee also requires the claimant to serve a notice of nonpayment on the property owner within the same 90-day window (T.C.A. §66-11-145).

Unlike California, Florida, and Arizona, Tennessee does not require a preliminary notice for subcontractors to preserve their lien rights. The notice of nonpayment serves a different purpose -- it is a prerequisite to filing the lien, not a condition of preserving preliminary rights. A prime contractor who files the lien without first serving the notice of nonpayment can have the lien challenged. Serve the notice and file the lien simultaneously, or serve the notice before filing.

Tennessee General Sessions Court handles civil claims up to $25,000 -- a limit that makes it useful for virtually all residential and most commercial service invoice disputes. Filing fees are $150 to $300. Cases are typically heard within 20 to 45 days of filing. Neither party is required to be represented by an attorney. Judgment can be enforced through garnishment of bank accounts or wages. For claims above $25,000, Circuit Court jurisdiction applies.

Tennessee's statute of limitations on written contracts is 6 years (T.C.A. §28-3-109(a)(3)). Oral contracts have a 6-year limit as well. The clock runs from the date the cause of action accrues -- when payment was due and not received. Tennessee courts have held that the limitation period begins when the invoice was first refused, not when the last follow-up attempt was made. For service businesses, this means a 2020 invoice remains actionable through 2026 but delay beyond 18 months makes witness memory and documentary evidence harder to produce.