Two new laws affecting the Florida Construction Industry include Public Projects and Amendments to the Statute of Repose

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There are two new bills that you should be aware of. The first bill is House Bill 599 which deals with Public Works Projects. The hyperlink to the bill, which was signed into law by the governor is found below:

https://www.flsenate.gov/Session/Bill/2017/599/BillText/er/PDF

The theory is that the amendment will provide a more competitive bid process for public construction projects where state dollars represent 50% or more of the funding. Prior to this bill, local governments could establish arbitrary pre-bid mandates on contractor’s telling them who they must hire, where they must train and what benefit packages they must offer if they want to bid the job with that entity. For many small businesses, these mandates made it unaffordable to bid on many public projects. The premise is, increasing competition will benefit Florida taxpayers.

The second piece of legislation of consequence is House Bill 377 which deals with limitations on lawsuits other than for the recovery of real property. A hyperlink to the legislation is found below:

https://www.flsenate.gov/Session/Bill/2017/377/BillText/er/PDF

What this bill hopes to accomplish is to clarify when and how Florida’s 10-year statute of repose begins to run on a completed project. The statute of repose defines the period in which an owner can sue for alleged construction defects. In a number of recent cases, a final payment was not made for construction costs. By making final payment late, the repose period was effectively extended beyond the 10 years envisioned by the Florida legislature.

The pertinent language now states:

Completion of the contract means the later of the date of final performance of all the contracted services or the date that final payment for such services becomes due without regard to the date final payment is made. This act applies to causes of action that accrue on or after July 1, 2017.

If you have any questions please feel free to give me a call.

Christopher Weiss Attorney at Law, P.A.
Board Certified Construction Attorney
17 N. Summerlin Avenue, Ste. 200
Orlando, FL 32801
(407) 928-6737
chris@cweisslaw.com

 

AVVO: Q & A – Can my home be liened by a window installer if no work has been performed, permit, financing and materials not delivered?

Christopher J. Weiss

Christopher J. Weiss

QUESTION:  I gave a deposit for window install and now don’t have the money to complete. I have not signed for the permit or the notice of commencement or the financing documents and no materials have been received or work performed. Can the window company put a lien on my house?

ANSWER:  In Florida, specially fabricated materials are lienable without incorporation. The issue is are they truly specially manufactured, designed, or fabricated for a particular project and are not materials that can be universally used on all projects. Specially fabricated materials have been described as those materials “not generally suited for nor readily adaptable to use in a like improvement.” Odolite Industries, Inc. v. Millman Const. Co., Inc., 501 So.2d 655, 656 (Fla. 3d DCA 1987) (quotation omitted). For instance, the Florida Supreme Court in Stunkel v. Gazebo Landscaping Design, Inc., 660 So.2d 623, 625 n.2 (Fla. 1995), noted that trees the owner specifically selected for a project were not specially fabricated because they could be used on other projects; whereas, in Lehigh Structural Steel Co. v. Joseph Langer, Inc., 43 So.2d 335, 338 (Fla. 1949), the Court noted that structural steel fabricated for a specific building was specially fabricated materials. (Notably, furnishing specially fabricated materials does not include “design work, submittals, or the like preliminary to actual fabrication of the materials.” Fla. Stat. s. 713.01(13).)

I suggest you engage a board certified construction attorney to advise you. Best regards.

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AVVO: Q & A – Can a subcontractor file a lien on a property after it is sold to a new owner?

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Christopher J. Weiss

Under Fla. Stat. §713.07(2), liens under §713.05 (persons in privity) and §713.06 (persons not in privity) with the owner, attach and take priority as of the time that the Notice of Commencement is recorded. You would need to determine if the lien was recorded after a Notice of Commencement has expired. Does the Claim of Lien relate back to the Notice of Commencement, even though it was recorded after the Notice of Commencement expired (i.e. over one year after the Notice of Commencement was recorded), or does the new owner take priority over the Claim of Lien?

Unfortunately, the State of Florida law on the issue of whether a Claim of Lien relates back to a Notice of Commencement when the Notice of Commencement has expired is rather convoluted.

Under Fla. Stat. §713.07(3), such liens have priority over any conveyance, demand or encumbrance not recorded against the real property prior to the time that the lien attached, which in our example would be when the notice of commencement was recorded. Conversely, §713.07(3) further provides that any conveyance, demand, or encumbrance recorded prior to the time that the lien attaches has priority over such liens.

Fla. Stat. §713.13 governs notices of commencement. §713.13(5) states that:

Unless otherwise provided in the notice of commencement or a new or amended notice of commencement, a notice of commencement is not effectual in law or equity against a conveyance, transfer, or mortgage of or lien on the real property described in the notice, or against creditors or subsequent purchasers for a valuable consideration, after 1 year after the date of recording the notice of commencement.

Sorry for the length of the response, but it is a little complicated. Good Luck.

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AVVO Q&A: I Have a Lien on a Property and the Owner is Contesting – What Are My Options?

Christopher J. Weiss

Christopher J. Weiss

QUESTION:  I have a contract with the builder but he was dismissed by the owner. The builder never paid me my final draw so I put a lien on the property, the builder is gone with the owners money so my only avenue was to lien property. What are my options I had a contract with their builder? They are contesting lien.

You do not specify your status on the job. If you are not a subcontractor, but rather were only providing labor, a Notice to Owner may not be required. If you are a site work contractor, a Notice to Owner may not be required either. If you are a subcontractor and are not in privity with the Owner, then you must have timely served a Notice to Owner as set forth in F.S. 713.06. You also must have timely recorded a Claim of Lien within 90 days of your last furnishing. If the Owner has filed a Notice of Contest of lien, your time frame for filing suit is shortened. You should go see a specialist in this area ASAP. Florida has a number of Board Certified Construction Attorneys. Also, don’t forget, the contractor may have assets. Hire an asset investigator to see if the contractor has resources to bother going after. You might be surprised. Of course the payment records to you should provide the name and account number of the contractor’s bank. That could be a useful source to garnish as well. I wish you all the luck in the world. You may need it to collect.

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Best regards.
Christopher Weiss

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Do We Have to Close if the Construction is not Finished?

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This happens all the time. It’s the day of closing and the house isn’t finished.

The purchasers complete pre-closing inspection and realize there’s no way they can live in the house. They call their lawyer in a panic. “Do we have to close if it is not finished?” Reputable builders will not usually force purchasers to close on an unfinished house, but too often these days the electricians, plumbers and carpet layers are in a race to finish the house before the movers show up. As always, the answer depends on what your contract says. Does the contract require approval by the lender or the municipality prior to closing? I don’t know. I hope your contract does not say issuance of a Certificate of Occupancy “shall constitute conclusive acceptance by the purchaser.”   This example explains why I urge people to spend some time and money on having such large contracts reviewed by an experienced Board Certified Construction Attorney.

If the contract is silent on the state of completion required for closing, the issue will be whether the work was sufficiently complete to permit “reasonable” occupancy of the premises. Before signing builder agreements for purchase and sale, buyers of new homes should hire a Board Certified Construction Attorney to examine the contract to ensure there is a clause that requires the builder or seller to close only when a certificate of occupancy has been issued by the building inspector, and your lender agrees construction is 100% complete, and they are ready to disperse. You would not want the city building inspector to have the final say on whether the purchaser must close. That standard of completion may be unacceptable! The final determination on whether you are required to close depends on the deal you cut in your contract.

If a completion issue is in dispute, try to establish with the seller an amicable holdback sufficient to insure the work is completed. Best regards.

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