Florida’s Construction Lien Laws: Final Payment Affidavit

By James M. Gonzalez and Jessica Cappock November 10, 2020 Posted in Construction Law Share

In the final segment of this series we highlight an often-forgotten step in the procedural process, the Final Payment Affidavit. The Final Payment Affidavit is a sworn statement that serves as a comprehensive outline, issued after completion of a project, to notify the property owner of how much money is still owed for materials and services provided. In Fetta v. All-Rite Paving Contractors, Inc. the Fourth District Court of Appeals further clarified that the purpose of the statute is to allow for the contractor to identify all lienors who have timely served a notice to owner and have not yet been paid their balance in full.[1] Most importantly, the Final Payment Affidavit protects the property owner from paying twice because it allows the owner to determine to whom the owner may pay directly, other than the contractor, to satisfy outstanding payments.[2]

 

a. Who is Required to Submit the Final Payment Affidavit?

Contractors must furnish the property owner with a Final Payment Affidavit by virtue of their direct contract (i.e. in privity) with the owner. Regardless of whether the contractor subcontracts any or all of the work, the contractor in privity with the owner is still on the hook for furnishing the owner with the affidavit. For this reason, even trade contractors – as opposed to general contractors – must also create a Final Payment Affidavit if they contract directly with the property owner.

b. Time Matters

Pursuant to Florida Statutes Chapter 713.06(5)(d)(1),

When the final payment under a direct contract becomes due the contractor:

1. The contractor shall give to the owner a Final Payment Affidavit stating, if that be the fact, that all lienors under his or her direct contract who have timely served a notice to owner on the owner and the contractor have been paid in full or, if the fact be otherwise, showing the name of each such lienor who has not been paid in full and the amount due or to become due each for labor, services, or materials furnished.

Importantly, the Final Payment Affidavit serves as the gatekeeper to a party’s lien rights. Failure to issue and serve this Affidavit will preclude a contractor from proceeding to enforce its lien rights. Pursuant to Fla. Stat. §713.06(5)(d)(1), “[t]he contractor shall have no lien or right of action against the owner for labor, services, or materials furnished under the direct contract while in default for not giving the owner the affidavit.” Moreover, the Final Payment Affidavit must be delivered to the owner at least five days before any lien rights can be enforced. Accuracy is key because the property owner may rely on the contractor’s affidavit…in making final payment. Fla. Stat. §713.06(5)(d)(4).

c. Final Payment Affidavit Errors

The Final Payment Affidavit is a statement given under oath and notarized. As such, it is important to draft a Final Payment Affidavit with care and specificity. However, mistakes made without prejudice to the owner will be excused and not constitute a default “that operates to defeat an otherwise valid lien.” Fla. Stat. § 713.06(5)(d)(1).

d. Delivery of Final Payment Affidavit

Although not addressed within the statute, delivery of the Final Payment Affidavit has been deemed sufficient if “evidence of proper posting in the mail of the affidavit at least five days before filing suit [is given].”[3] Therefore, sending the Affidavit via certified mail is likely the best option to obtain proof of service and receipt and protect against claims of non-delivery.

The following form has been provided under Florida Statute Chapter 713.06(5)(d)(1) for the creation of a Final Payment Affidavit:

CONTRACTOR’S FINAL PAYMENT AFFIDAVIT

State of Florida
County of  

Before me, the undersigned authority, personally appeared   (name of affiant)  , who, after being first duly sworn, deposes and says of his or her personal knowledge the following:

1. He or she is the   (title of affiant)  , of   (name of contractor’s business)  , which does business in the State of Florida, hereinafter referred to as the “Contractor.”

2. Contractor, pursuant to a contract with   (name of owner)  , hereinafter referred to as the “Owner,” has furnished or caused to be furnished labor, materials, and services for the construction of certain improvements to real property as more particularly set forth in said contract.

3. This affidavit is executed by the Contractor in accordance with section 713.06 of the Florida Statutes for the purposes of obtaining final payment from the Owner in the amount of $ .

4. All work to be performed under the contract has been fully completed, and all lienors under the direct contract have been paid in full, except the following listed lienors:

NAME OF LIENOR    AMOUNT DUE

Signed, sealed, and delivered this   day of  ,  ,

By   (name of affiant)  

  (title of affiant)  

  (name of contractor’s business)  

Sworn to and subscribed before me this   day of   by   (name of affiant)  , who is personally known to me or produced   as identification, and did take an oath.

  (name of notary public)  

Notary Public

My Commission Expires:

  (date of expiration of commission)  

e. Conclusion

Maintaining careful compliance with Florida’s Construction Lien Law is essential to a contractor’s successful lien claim. Florida’s lien law is also a great tool for an owner to obtain certain information regarding the work being performed on their property. With such particular with strict deadlines and requirements to be met to preserve the lien, it is imperative that contractors, developers, and owners have a firm grasp on this statute. This series has walked through the lien process and provided a comprehensive overview of the statutory guidelines. Please do not hesitate to give us a call should you have additional questions or concerns regarding Florida’s Construction Lien Law Statute and how to protect your interests.

[1] Fetta v. All-Rite Paving Contractors, Inc., 50 So. 3d 1216 (Fla. 4th DCA 2010).

[2] Coquina, Ltd. v. Nicholson Cabinet Co., 509 So. 2d 1344,1346 (Fla. 1st DCA 1987).

[3] State-Wide Const., Inc. v. Dowda, 418 So. 2d 1238 (Fla. 5th DCA 1982).

To see the previous blogs in this series, visit: https://www.cobbgonzalez.com/blog/