I am a Florida property owner getting ready to start a major improvement project. Do I have to worry about protecting myself from my contractor not paying his sub-contractors, suppliers, or labor providers? The answer is YES! Florida Law allows a materialman, laborer, subcontractor, or sub-subcontractor to place a lien on real property even if they never had a contract with the property owner.
To protect themselves in the event they are not paid for the material or services provided, the materialman, laborer, subcontractor, or sub-subcontractor must provide the property owner with a “Notice to Owner.” The Notice to Owner alerts the owner of the potential for a claim against their property if proper payments are not made, even if the owner pays the contract in full.
To be effective the Notice to Owner must meet certain requirements which are spelled out in Florida Statute 713.06. One of the requirements is timing. The Notice to Owner must be served on the owner no later than 45 days after the subcontractor commences to provide the services or material but before the owner has made final payment to the contractor. Fla. Stat. 713.06(2)(a). Section 713.06 also contains specific language that must be conspicuously in the Notice to Owner. “As creature of statute, construction lien laws must be strictly construed.” Zalay v. Ace Cabinets of Clearwater, Inc., 700 So. 2d 15 (Fla. 2d DCA 1997). Therefore, any potential lienor that does not strictly comply with the requirement of the statute will lose their right to enforce a lien against the property.
So how does a property owner who has been served with a proper Notice to Owner protect themselves? The same statute that provides the materialman, laborer, subcontractor, or sub-subcontractor the right to lien the property if not paid, also provides the owner certain rights to ensure potential lienors are paid. First, the owner has the right to require proof from the contractor that all those who have provided a Notice to Owner have been paid. Second, if the contractor provides the owner an affidavit of outstanding bills, the owner has the right to pay the bills directly and deduct the amount so paid from the payment due to the contractor. Fla. Stat. 713.06(3)(c). When the final payment to the contractor comes due, the contractor is require to provide the owner a Final Payment Affidavit stating the all lienors who provided a Notice to Owner have been paid in full, or list those such lienors who have not been paid in full and the amount due to the same. Fla. Stat. 713.06(3)(d).
Finally, an owner can condition payment to a contractor upon receipt of a lien waiver. A lien waiver provides that the person receiving payment and signing the waiver is waiving his right to place a lien on the property in exchange for payment. A valid lien waiver prevents a subcontractor from filing a lien upon the property after the fact. Obtaining lien waivers from the individual subcontractors can help ensure that all outstanding amounts are actually being paid by the contractor.
Whether you are a contractor concerned about enforcing your lien rights, or a property owner having difficulty getting satisfactory performance from a contractor, the law firm of Boatman Ricci is here to help. Contact us today at (239) 330-1494 to schedule an initial consultation.
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