Florida Construction Liens
The laws and procedures in Chapter 7 and 13 are applicable to projects involving improvements to privately owned real property.Florida's Construction Lien Law has a dual purpose.
- The first is to protect owners by placing limits on their liability to lienors.
- The second is to prevent unjust enrichment of the owners at the expense of contractors, subcontractors, sub subcontractors, materialmen, suppliers and laborers who improve the owner's property.
A construction lien is a claim or charge against privately owned real property to secure a debt incurred for improvement of the property. Liens are a creature of statute so certain procedural requirements must be followed and deadlines must be met. §713.37, Fla. Stat. A lienor is a person or company who is: (a) a contractor; (b) a subcontractor; (c) a sub subcontractor; (d) a laborer; (e) a materialman; or (f) a professional lienor. The construction lien must be in substantially the same form as provided in §713.08(3) and shall contain:
- the name and address of the lienor where notice or process may be served;
- the name of the person with whom the lienor contracted or by whom he was employed;
- the labor, services or materials furnished and the contract price or value thereof;
- the contract price or value of materials specially fabricated at a place other than the job site, for incorporation in the improvement but not so incorporated, shall be stated separately in the lien;
- a description of the real property sufficient for identification;
- the owner's name;
- the time when the first and last item of labor, services or materials were furnished;
- the amount unpaid the lienor for such labor, services or materials and for unpaid finance charges due under the lienor’s contract;
if the lienor is not in privity with the owner, the date and method of service of the Notice to Owner;
and, if the lienor is not in privity with the contractor or subcontractor, the date and method of service of the copy of the Notice to Owner on the Contractor or Subcontractor.
Additionally, the lien must be executed and verified by someone familiar with the facts. The amount unpaid to the lienor for labor or services or materials should not include, for example, overhead and profit as separate items, costs of construction delays, and attorney’s fees to be expended.
The “reasonable value" of the labor, services or materials is the criteria for measuring the amount for which a Lien may be claimed. §713.08 allows lienors to include, in their lien amount, amounts for “unpaid finance charges due under the lienor’s contract." To be included, finance charges must be allowed under the contract. Construction Liens may be recorded at any time during the progress of the work or thereafter, but not later than ninety (90) days after the “final furnishing" of labor, services or materials; or with respect to rental equipment, within ninety (90) days after the date the rental equipment was last on the job site available for use. Florida Statute 713.08 requires that the Claim of Lien include a mandatory warning that alerts an owner that a Lien has been placed on the owner’s property, and that the owner can take steps to shorten the one year time period for the Lien after it is recorded.
The warning must be in substantially the same form as is prescribed by statute. A complaint to foreclose a construction lien must be filed within one (1) year after the claim of lien has been recorded. If an amended claim of lien has been filed, the suit should be commenced within one (1) year of recording the first lien, not the amended lien. The continuation of the lien effected by the commencement of the action shall not be good against creditors or subsequent purchasers for a valuable consideration and without notice, unless a notice of lis pendens is recorded.
Florida case law provides that the rules for time computations provided in Rule 1.090(a) of the Florida Rules of Civil Procedure apply to Chapter 713. Therefore, if any prescribed time period under Florida Statutes Chapter 713 ends on a Saturday, Sunday or legal holiday, the construction lien will not expire until the next business day that an action could be filed.