Construction jobs, no matter how big or small, can be complicated and require extensive documentation and payment. It’s important for both the property owner and the contractors working on the property to protect themselves in case something goes wrong on either end of the project.
In Florida, a construction lien is a tool to ensure the proper payment for work and materials is done fully and in a timely manner. For contractors, the lien allows them to claim real property or materials until the agreed-to payments are made fully. It’s important to note government property is exempt from construction liens, so if your project relates to government work, you will not be able to use a construction lien to ensure payment.
Claim of Lien
You will need to file a Claim of Lien if you intend to use this tool to secure your project. Your claim must be filed with the clerk’s office within 90 days of the final day work or materials were furnished in the project in question. Once the claim is filed, it will need to be served to the owner within 15 days.
Your claim needs to be thorough and include all documentation of who worked on the project, when and where the work was being done, when payment was due, and how much payment is still owed.
Contest of Lien
Once a claim has been filed, it is valid for one year unless the lienor (the party who claims the lien) files a lawsuit to extend the lien beyond the one-year period. The timeline completely changes, however, if the owner files a Contest of Lien during the initial one-year period. At that time, the lienor has 60 days to formally file a lawsuit to enforce the lien.
An owner can contest a lien if they believe and have proof the lien is unenforceable because proper and timely payments have been made to all contractors as previously agreed to. Owners should always file a Release of Lien (or require the contractors to do so) when a project is complete and payments are completed and documented. A Release of Lien blocks contractors from filing a Contest of Lien once proof of payment is provided. A Release of Lien cannot be filed in advance, because Florida laws prevent contractors from waiving their right to lien property in order to secure payment.
Selling under lien
An active lien on property changes how the sale of the property will work. If you had work done with the intent to sell, you will need to be cognizant of these changes. You CAN sell the property, but the sale will need to stipulate how the lien will be taken care of. Are you using the funds in the sale to pay off the lien? Is the buyer taking responsibility for the lien? Whatever the case, the lien must be satisfied in order for any sale or transfer of the property.
Protect your hard work
Whether you’re a contractor looking to claim a lien or an owner looking to protect your property, Florida Construction Law Group is here to help. This can be an expensive and exhausting process, so you should not take it on yourself. Contact us today to get your case started! Our senior attorney, Ray Garcia, has received the highest rating available from Martindale-Hubbell!
