The real estate business is one of the most profitable industries in Florida. Unfortunately, it is not unusual to find cases in which a failure to pay contractors, subcontractors, or material suppliers results in the enforcement of a construction lien.
In this article, you will understand what a construction lien is and how to protect against it in Florida.
Florida Construction Liens – An Introduction
Under Florida law, if someone provides construction services or materials to develop a property, this person or entity is entitled to be paid in full. If the property’s owners fail to pay the owed amount in full, the injured party has the right to file a claim against the property.
This specific type of claim is referred to as a “construction lien.” Similarly, if a contractor fails to pay the owed amount to subcontractors or material suppliers, they have the right to file a claim against the property – even if the owner has paid the contractor the full amount.
If the property’s owner fails to remove the lien placed against it, the property might be sold against the owner’s will and the proceeds obtained in the sale can be used to fulfill unpaid debt associated with labor, materials, or other construction services.
Florida Construction Liens – Notice to Owner
No lien can be attached to a property in Florida before the claimant files a Notice to Owner. In the notice, the lienor (person filing the lien) must provide:
- The lienor’s name
- The lienor’s address
- A full description of the real property
- A detailed description of the nature of the services or materials furnished by the lienor
The lienor must serve the Notice to Owner before (or within 45 days) the furnishing of services or materials is commenced. If the lienor fails to serve the Notice to Owner, it is not possible to enforce the lien.
Florida Construction Liens – What Situations May Create a Lien in a Florida Property?
Several construction professionals have the right to file a claim of lien for unpaid work or materials, including:
- Construction laborers
- Material suppliers
- Land surveyors
- Interior designers
Property owners must always require a release of lien from professionals who provide construction services or materials for them.
It is possible to work with an expert attorney to draft an appropriate agreement requiring construction professionals to provide all necessary releases of lien.
Unless the outstanding liens are paid, the owner of the property to which they are attached is not allowed to sell it. Depending on the severity of the situation, the owner can be forced to sell the property to fulfill the lienor’s claims.
Florida Construction Liens – Is it Possible to Contest a Lien?
Unless the lienor fails to file a lawsuit to enforce the lien before the expiration date, Florida liens are valid for one year. During this one year, the owner of the property is entitled to file a Notice of Contest of Lien.
After the owner’s Notice of Contest is filed in court, the lienor must file a counterclaim to enforce the lien within the next 60 days. If the lienor fails to file the lawsuit within the statutory period, the lien is invalid.