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Florida Construction Liens: New Verdict Illustrates the Importance of Good Record Keeping and Timely Filing

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Recently, the Florida Second District Court of Appeal released a decision in a construction lien case that originated out of a breach of contract dispute. After full payment was not received for work done in relation to a home renovation, a lien was placed against a homeowner’s property. However, a dispute quickly arose over the validity of that construction lien. This case demonstrates that contractors must keep good records and file liens as soon as possible. The failure to take action could result in contractors losing out on their legal rights.

Lack of Payment for a Condo Renovation Led to the Dispute

A couple who owned a condo in Naples, Florida hired Best Drywall Services to be the primary contractor on a major home renovation project. The renovation was comprehensive; it included work on the air conditioning system, electrical fixtures and the home’s plumbing. According to the Second District Court, Best Drywall Services submitted documentation that indicated that a total of $321,600.31 worth of work was done on the property. That amount included the costs of both labor and the materials provided. However, the contractor alleged that the condo owners failed to pay the final two installments that were owed to the company. The unpaid amount totalled $61,600.31. To recover those costs, the company filed a construction lien against the property. The lien was filed exactly 90 days from the date that company claims that it completed work at the condo. Under Florida law, all construction liens must be filed no later than 90 days from the date that the last meaningful work was conducted on the property. In other words, the contractor claims that they filed the lien on the day of the deadline.

Confusion Arose Over the Date that Work Was Completed

As with most complex construction and renovations projects, several subcontractors were also active on the site. The complicated nature of the work led to confusion over the exact date when the project was actually completed. In fact, different people identified several different dates. The dates given ranged over several weeks. The homeowners contended that the lien could not stand on the grounds that the contractor could not prove that it obtained its construction lien in a timely manner. In the end, the appeals court remanded the case to the lower court to sort out that issue of fact. The lessons from this case are very clear:

  1. Contractors must always keep pristine records regarding their work; and
  2. Contractors should always take action to obtain a lien well in advance of the 90 day deadline.

A construction lien is an extremely valuable legal tool. It is imperative that contractors take proactive steps to protect their ability to use this tool to recoup compensation for unpaid bills.

Do You Need Legal Advice?

The business litigation attorneys at Pike & Lustig, LLP can help. To learn more about what our team can do for you, please do not hesitate to contact our West Palm Beach office today. We will review your case free of charge. Our firm represents businesses throughout South Florida, including in Wellington, Boca Raton and Fort Lauderdale.

Resource:

2dca.org/opinions/Opinion_Pages/Opinion_Pages_2016/October/October%2026,%202016/2D15-2103.pdf

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