Florida’s economy continues to take a beating from the Coronavirus and state and county governments (such as Broward County’s Emergency Order 20-01) recommend or order that non-essential businesses close. However, the recommendations and orders have exemptions and may include construction businesses. Thus, many contractors, subcontractors, suppliers, or laborers will continue to work on construction projects that were started prior to the sharp downturn. A risk is that owners may soon be unable to pay for work or materials due to lack of income, financing, or other funding. Conversely, contractors may attempt to file liens against properties for disputed amounts knowing an owner may be unable to financially sustain a lien dispute.
Through a multi-part series, we will provide an overview of Florida’s lien laws and how contractors, subcontractors, suppliers, or laborers can protect their work and labor and how owners can protect themselves from fraudulent liens. In this post, we will outline the basics of a construction lien and the initial deadlines.
Construction liens serve the important purpose to protect a contractor that provided materials and labor to a project. Florida Statutes, Chapter 713, covers construction liens and details who is eligible and how to secure a valid lien. Generally, a party such as a contractor, subcontractor, supplier, and laborer can use a construction lien to ensure payment for work and materials.
The statutes’ requirements are tedious and failure to closely follow the instructions or miss a deadline can nullify a construction lien. The Florida courts strictly interpret the statutes. This means a potential lien holder must follow the statute’s requirements with exacting detail. Further, while some courts may be closed, parts of Florida’s filing system are still open and the deadlines need to be followed. A contractor may waste valuable time trying to work with an owner thinking that a resolution is possible. But, having a valid construction lien gives one leverage during the negotiations.
An owner must file a Notice of Commencement which is a document announcing the owner is improving the property. The Notice of Commencement must include the property’s legal description, the owner’s name, the general contractor’s name, a general description of the improvement, and the name and address of the surety and lender, if any. Construction must commence within 90 days. A Notice of Commencement is valid for one year.
A threshold question is whether the party seeking the lien has a contract with the owner. If there is no contract, then the party is not in privity with the owner and must prepare a “Notice to Owner.” The Notice to Owner must be served on the owner at any time before the expiration of 45 days from the party’s first furnish labor, materials, or services to the project.
At Gunther McIntosh, PLLC we know construction liens and have filed and managed lien matters throughout South Florida. We can assist contractors, subcontractors, suppliers, and laborers to secure a lien and seek payment from the owner; and we can help owners who find themselves in situations where a fraudulent lien is filed against their property. Contact Ben Dowers to set up a consultation at firstname.lastname@example.org or 954-556-1487.
Disclaimer: The information contained in this post is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, and should not be relied upon as legal advice for your specific factual pattern or situation.