Florida’s Construction Lien Laws: Notice to Owner-The Who, What, and When

Florida’s Construction Lien Laws: Notice to Owner-The Who, What, and When

By James M. Gonzalez November 2, 2019 Posted in Construction Law

Florida’s Construction Lien Laws: Notice to Owner-The Who, What, and When

The second installment of our Florida Construction Lien Laws segment discusses a vital requirement to maintaining your lien rights: providing a Notice to Owner. We will delve into what the Notice to Owner is, who is required to provide it, when it is required to be provided, and what language it must contain. When required, failing to provide a Notice to Owner is an absolute bar to your lien rights.

A Notice to Owner is a letter provided to the Owner of a property or project that indicates who you are, what service or material you are providing, and with whom you are in contract. The Notice to Owner requirement hinges on whether or not the individual or entity providing materials or services is in privity with the Owner.

Additionally, If the individual or entity is in direct contract (i.e. privity) with the Owner, then a Notice to Owner is not required. See Fla. Stat., §713.05. To determine whether you fall within this exemption, you must: 1) have a “direct contract”; 2) with the “Owner”; and 3) the agreement must be a “contract” as defined by the statute. Florida Statute §713.01 defines these three terms as follows:

    • Direct contract” means a contract between the owner and any other person. See Fla. Stat. §713.01 (9);
    • Owner” means a person who is the owner of any legal or equitable interest in real property, which interest can be sold by legal process, and who enters into a contract for the improvement of the real property. The term includes a condominium association pursuant to chapter 718 as to improvements made to association property or common elements. The term does not include any political subdivision, agency, or department of the state, a municipality, or other governmental entity. See Fla. Stat.§713.01 (23); and
    • Contract” means an agreement for improving real property, written or unwritten, express or implied, and includes extras or change orders. See Fla. Stat.§713.01 (6);

If the individual or entity performing work on the project or property is not in contractual privity with the owner (i.e. a subcontractor or supplier, etc.) then they are required to provide a Notice to Owner. Specifically, Fla. Stat., §713.06 provides:

(1) A materialman or laborer, either of whom is not in privity with the owner, or a subcontractor or sub-subcontractor who complies with the provisions of this part and is subject to the limitations thereof, has a lien on the real property improved for any money that is owed to him or her for labor, services, or materials furnished in accordance with his or her contract and with the direct contract and for any unpaid finance charges due under the lienor’s contract.

2)(a) All lienors under this section, except laborers, as a prerequisite to perfecting a lien under this chapter and recording a claim of lien, must serve a notice on the owner setting forth the lienor’s name and address, a description sufficient for identification of the real property, and the nature of the services or materials furnished or to be furnished.

Importantly, the statute also requires that the lienor (subcontractor, sub-subcontractor, materialman, etc.) furnish a copy of the Notice to Owner on the contractor (or subcontractor as applicable) as a prerequisite to perfecting and recording a lien. In addition, the Notice to Owner must be furnished to the Owner – and any other entity required to receive a copy – before commencing work on the project, or no later than 45 days after commencing work. Regardless, the Notice to Owner must be furnished before the date of the owner’s disbursement of payment pursuant to the contractor’s affidavit of final payment. A word of caution, the failure to serve the notice, or to timely serve it, is a complete defense to enforcement of a lien by any person.

For more information on lien rights and how they may impact your property, project or business, do not hesitate to contact us via the link below.

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