If you are a Florida contractor or you utilize contractors in your construction projects, then it is essential that you understand Florida Statute 713. This statute lays out Florida state law with regard to liens, and more specifically for our purposes, construction liens.
The dictionary definition of a lien is “a charge upon real or personal property for the satisfaction of some debt or duty ordinarily arising by operation of law.” In the case of construction projects, a lien refers to when a contractor, subcontractor, or material supplier (known as the “lienor”) has provided labor, material, supplies, or services for the purpose of improving real, private property, and for one reason or another has not been paid for those goods or services.
In order to secure payment for his or her services, the lienor swears under oath, which creates a legal affidavit, that the materials or labor was provided and the required payment was not furnished. This creates a “Claim of Lien” which is placed on the property where the work was performed.
Having a Claim of Lien on one’s property makes it extremely difficult to sell or refinance the property, and is meant, from the lienor’s perspective, to force the property owner to settle the unpaid debt in court. Furthermore, if the required criteria are fulfilled, the lien will be considered “perfected,” meaning the lienor will have the right to foreclose the property if the debt is not settled.
Any prospective lienor in Florida must file the claim within 90 days of the completion of his or her contracted duty. The claim must be recorded in the county in which the property is located, and must list detailed information about the project for which they were not paid, including:
- Lienor’s name and address
- Name of whomever contracted the lienor
- The materials, labor, or services rendered and their contract price
- Description of the property
- Name of the owner of the property
- Time when the first and last materials/labor/services were furnished
- The amount of money that remains unpaid
It is relatively simple to perfect a construction lien claim if the lienor was in “privity” with the owner, meaning they shared a one-on-one contractual agreement. If the lienor was not directly contracted by the owner, they must have given proper notice to the owner of the work they were contracted to complete on the owner’s property in order to perfect a Claim of Lien afterwards.
A Claim of Lien can only be used to recover the funds that were directly owed for the contracted services—it cannot cover damages or losses due to the nonpayment. An attempt to foreclose a property with a construction lien must be filed in court within a year of the Claim of Lien being filed.
If you are a contractor who was not paid for your services and would like to file a Claim of Lien, or if you are a property owner facing a construction lien against your property, please call the Florida Construction Law Group to discuss your options and to let us start fighting for your rights.
