There are four very specific disclosures that may be required by the law to be in your construction contract. 1. Lien…
There are four very specific traps that exist in construction lien law and that we often see clients fall into.
1. When is your last day on the job?
It’s important to know that punch list and warranty work does not count as last work. It has to be work that would entitle you to compensation under your contact or a change order.
2. It’s critical that you respond to requests for sworn statement of account.
A request for a sworn statement of account is a document that you will receive, usually via certified mail, and it includes a warning that if you fail to respond under oath within thirty days, you will lose your lien rights. Make no mistake, if you don’t respond timely or you don’t respond under oath, you will lose your lien rights.
3. Amending your claim of lien.
You may amend your lien as many times as you’d like as long as you’re only amending it within the original ninety days you have to record the lien. You can record your lien on day 27, amend it on day 35, and amend it again on day 89, but whatever exists as of the 90th day from the last day of work on the job, that’s the lien that you need to stick with throughout the course of any litigation associated with your claim.
4. Finally, it’s important to timely file suit on your claim of lien.
Normally you have one year from the recording date of the claim of lien. However, this can be shortened. A notice of contest of lien is a document that you’ll receive from the clerk’s office via certified mail. It reduces the amount of time you have to file suit from 1 year from the recording date of the claim of lien to 60 days from the date that document was sent to you. If you do not file suit within those 60 days you will lose your lien rights. Sometimes owners aren’t happy with reducing the time frame down to 60 days and they want to reduce it even further. They have a means to do that with what’s called a Twenty Day Summons to Show Cause. Unlike a Notice of Contest which is sent to you via certified mail, a Twenty Day Summons is in fact a legal notice served upon you by either a process server or the sheriff. If you don’t file suit within 20 days, you’ll lose your lien rights. The law in this regards is very harsh. You need to file a counter claim or a separate action to foreclose your lien within those 20 days or your lien rights will automatically expire.
While we’ve covered 4 very specific traps that exist in Florida’s lien law, by no means is this list exhaustive. Florida’s lien law is very unforgiving, especially to those who do not understand it. Make sure you consult your attorney to obtain necessary guidance.