PART II – IMPORTANT DEADLINES FOR CONSTRUCTION LIENS IN FLORIDA
This is part 2 of a 3-part series of blogs on the basics of drafting and recording construction liens in Florida. This blog addresses important deadlines for construction liens and some of the common responses to the filing of a construction lien. Part 1 addresses how to properly draft and record a construction in Florida. Part 3 addresses fraudulent construction liens.
Important Deadlines for Construction Liens in Florida
Section 713.08, Florida Statutes provides that a claim of lien must be recorded within 90 days of the “final furnishing” of work or the termination of a contract. “Final furnishing of work” has been held by Florida courts to mean work that is performed as a “necessary continuation of the contract work.” See e.g. In re Jennerwein, Bkrtcy.M.D.Fla.2004, 309 B.R. 385.
The test for whether work constitutes a final furnishing of work on a construction project, so as to trigger the 90-day period for filing a construction lien, is whether the work was done in good faith, within a reasonable time, pursuant to the terms of the contract, and whether it was necessary to a finished job. Importantly, remedial work such as warranty work, corrective work, repair work, or work that is incidental and not necessary to a completed contract does not extend the time for filing a claim of lien. See Sam Rodgers Properties, Inc. v. Chmura, 61 So. 3d 432, 438 (Fla. 2d DCA 2011).
Therefore, a potential lienor cannot return to a property after substantial completion and perform inconsequential work just to “reset” the 90-day time limit for filing a lien. It is therefore extremely important that a contractor note for each job the deadline for the filing of a claim of lien at the time the job is substantially completed.
Important Deadlines for Subcontractors – Notice to Owner
If a lienor is not in privity with the property owner (i.e. the lienor is a sub-contractor), then he must serve a “Notice to Owner” within 45 days after commencing work on the job, but, in any event, the Notice to Owner must be served before final payment is made by the owner to the contractor. See Section 713.06, Florida Statutes. This Notice to Owner is a prerequisite to filing a claim of lien. In other words, if a sub-contractor fails to timely serve a Notice to Owner then he loses his right to file a lien against the property for work completed.
Time Limit for the Enforcement of Construction Liens in Florida – One Year
Absent a Notice of Contest of Lien, a construction lien will only remain enforceable for up to one year. See Section 713.22, Florida Statutes. Therefore, a contractor must enforce any lien within one year of filing said lien. A lienis not enforceable beyond one-year from the date of its filing.
Common Responses by the Homeowner to a Construction Lien
In addition to the requirement that a lien be enforced within one-year, a contractor–and a homeowner–should be aware of two potential responses by a homeowner to the filing of a construction lien: 1) Request for Sworn Statement of Account; and 2) Notice of Contest of Lien.
1. Request for Sworn Statement of Account
Pursuant to Section 713.16, Florida Statutes, a property owner may demand a “Sworn Statement of Account” from a lienor. If such a request is received by the lienor, he must furnish the Sworn Statement of Account within 30 days. The failure to furnish the Sworn Statement of Account within 30 days of the demand, deprives the lienor of his lien. The Sworn Statement of Account is an important statutory tool that should be taken seriously. If served with a Request for Sworn Statement of Account, a contractor should contact an attorney to help compile a response within the required timeframe.
2. Notice of Contest of Lien
In order to shorten the duration of a lien, a homeowner may record a “Notice of Contest of Lien” pursuant to Section 713.22, Florida Statutes. A lienor has 60-days from the service of a Notice of Contest of Lien to file an action to enforce said lien after which time the lien will be extinguished automatically. A Notice of Contest of Lien can be an important tool for a homeowner to accelerate a dispute over payment with a contractor. It is important that upon receipt of a Notice of Contest of Lien, a contractor note that he must enforce the claim of lien within 60-days or he will lose the right to enforce said lien.
As you can see there are many moving parts to Florida’s Construction Lien Law. Although a construction lien can be an extremely powerful tool for a contractor to collect payment for work completed, there are many methods and tools available to the homeowner to protect his/her property.
Boatman Ricci’s attorneys are experienced in drafting and enforcing claims of liens for contractors as well as defending homeowners against wrongfully filed claims of lien. If you need assistance in either area please contact us at (239) 330-1494.
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