Florida construction lien law

May 25, 2021

Using a Construction Lien to Secure Payment

by B. Michael Clark, Jr.

B. Michael Clark, Jr.

It is essential for those in the construction industry, including contractors, subcontractors and suppliers, to learn about construction liens, which can be an additional layer of protection from non-payment. A construction lien provides unpaid project participants the ability to claim an interest in the property they have worked on. Once recorded, the lien remains on the title of the property until the lienholder gets paid for the work or services it provided, or the lien is otherwise released or discharged.

Though a helpful option in recovering unpaid amounts, the process of recording a construction lien is technical, and failing to follow specific requirements, some of which are outlined below, can result in a lien that is not perfected and subject to challenge. The following suggestions should be considered when filing a construction lien:

Serve a Notice to Owner

Most claimants who do not have a direct contract with an owner need to serve a Notice to Owner as a first step in perfecting a claim of lien. Subcontractors, sub-subcontractors and material suppliers working on a construction project must serve a Notice to Owner pursuant to Section 713.06, Florida Statutes, within 45 days of first performing work or furnishing materials. Doing so preserves their right to record a claim of lien. Failure to properly complete this step can make a future claim of lien unenforceable.

April 14, 2017

Nicholas Siegfried Quoted in Articles on Appellate Ruling Against Trump National Doral by Daily Business Review, The Real Deal and South Florida Business Journal

by Siegfried Rivera

Siegfried Rivera

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.

June 14, 2016

Article by Michael Clark in Today’s Daily Business Review: “Ruling Creates Opening for Property Owners to Escape from Liens”

by Siegfried Rivera

Siegfried Rivera

Firm partner B. Michael Clark, Jr. authored an article that appeared in today’s edition of the Daily Business Review, South Florida’s exclusive business daily and official court newspaper. The article, which was titled “Ruling Creates Opening for Property Owners to Escape from Liens,” focuses on the implications of a recent ruling by the Second District Court of Appeal that has created a potential new opening for property owners to quickly wipe away the lien rights of unwary lienors. Michael’s article reads:

The decision came in the case of Georgia Hiller v. Phoenix Associates of South Florida. Hiller, a homeowner, contracted Phoenix for work on her home and then allegedly failed to pay. Phoenix recorded a lien against her property, and Hiller responded by posting a transfer bond to remove the cloud of the encumbrance from the property.

Hiller proceeded to record a notice of contest under section 713.22(2), shortening the time frame for Phoenix to commence an action against the transfer bond to 60 days.

The contractor had already filed a complaint against Hiller to foreclose the lien as well as for breach of contract and unjust enrichment. However, despite having notice of the transfer and the contest, it failed to commence an action against the surety within the 60-day deadline. Instead, after the passage of more than 60 days, it filed a motion to amend its complaint to add the surety of the transfer bond to the suit.

Hiller, presuming that the transfer bond automatically extinguished after the 60 days elapsed, filed a motion for the release of the transfer bond, which was denied by the trial court and became the basis for her appeal.