For insight into the ramifications of important court rulings involving construction law in South Florida, the region’s most widely read and highly regarded business and real estate media outlets often turn to the expertise of our firm’s construction lawyers. The latest example can be found in articles on an appellate ruling against the Trump National Doral golf resort that appeared today in the Daily Business Review, The Real Deal and South Florida Business Journal. Journalists from all three of these outlets interviewed firm partner Nicholas D. Siegfried, who is board certified in construction law by The Florida Bar, and quoted him in their articles.
The litigation stems from The Paint Spot’s 2014 lien against Trump National Doral Miami, which is owned by companies belonging to President Donald Trump. The paint supplier claimed it was due a final payment of approximately $32,000 from the resort. The renovation project utilized two contractors, and a Trump representative inadvertently handed The Paint Spot incorrect contractor information for its pre-suit notice to owner.
The Trump company argued the lien was invalid because The Paint Spot had served the wrong contractor. However, the appellate court ruled that the resort had actual knowledge of the supplier’s “notice to owner,” which had “substantially complied with statutory requirements.”
The end result for the Trump company is that by fighting the $32,000 bill, it will now end up paying well over 10 times as much just for the plaintiff’s attorney fees. According to the report by the Daily Business Review, South Florida’s exclusive business daily and official court newspaper, the resort is now facing a legal tab of approximately $390,000 to cover the prevailing party’s attorneys’ fees and costs.
That’s because the circuit court ruling applied a risk, or contingency fee, multiplier of 1.75 to calculate The Paint Spot’s reasonable attorney rates, which amounted to approximately $284,000 prior to the appeal. Now the company expects to tack on the multiplier for the appellate proceedings, multiplying the $75,000 it incurred on appeal also by 1.75. In addition, the amount for the lien itself has ballooned with interest to about $50,000, and the costs for the resort’s own legal fees undoubtedly are also very substantial.
The article concludes:
“This is what happens in these cases. Legal fees start to drive it,” said construction attorney Nicholas Siegfried, who was not involved in the litigation. “It appears that it got to a point where the parties were really fighting about the fees, and both sides dug in on their position,” he said.
Nicholas discusses the takeaways from the ruling for property owners and construction material suppliers in the articles that appear in The Real Deal and South Florida Business Journal. The Real Deal article reads:
Nicholas Siegfried, a construction litigation attorney not involved in the case, told TRD that the ruling makes it clear that developers and property owners who receive a notice when a subcontractor delivers materials must make payments, regardless of any clerical errors. “I think what [Trump Endeavor] was relying on was a technical argument to get out of the liability,” Siegfried said. “They knew they were on notice and they knew they had to pay.”
The South Florida Business Journal article concludes:
Nicholas Siegfried, partner at Siegfried Rivera who specializes in construction law, said contractors and materials suppliers like Paint Spot should make sure they serve notice to the owner for payment or they could face a similar fight.
“I think the bottom line is there was no disputing that The Paint Spot properly served a notice to the owner,” Siegfried said.