Construction professionals at work

Before jumping into the specifics on how public bond claims or “liens” work in the State of Florida, it’s important to point out the differences between private liens and state liens. I’ve written a few blog posts comparing these remedies, and here are some helpful links:

Now, to get to the matter at hand:  State construction projects in Florida, and what you can do to preserve your rights when unpaid on these projects.

Part I:  Understand You’re Filing A Claim Against The Bond, Not The Property

If you’re unpaid on a private construction project, you’re going to file a mechanics lien against the property itself.  The property where you performed work acts legal security for your debt, and in theory, you can foreclose on that property, have it sold at a sheriff’s sale, and collect your payment.

Obviously, the government is not going to let you foreclose on its own property. So on state projects in Florida, as elsewhere, if unpaid you can file a “lien” or claim against the project’s bond, and then foreclose or enforce against the bond.

Most state projects require the prime contractor to obtain and record a bond. Knowing who issued the bond is important, and if you don’t know if a bond exists or any details about the bond, you can request it. The Florida statutes provide that “any claimant may apply to the governmental entity having charge of the work for copies of the contract and bond.”

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Part II:  Send Required Preliminary Notices

Ah, the dreadful preliminary notice.  Some states require notices on private and state projects, some states don’t, and other states only require notices on one project type or another.  Understandably, it’s hard to keep up with these notice and lien requirements. Unfortunately, however, those difficulties do not excuse noncompliance.

Florida is a notice state regardless of whether working on a state or private project. If you’re not in “privity” with the prime contractor (i.e. you contracted with a subcontractor), you must deliver a written preliminary notice to the prime contractor within 45 days of first furnishing labor and/or materials to the project.

This notice must be served to the prime contractor and surety pursuant to the requirements of F.S. §713.18, which allows for service by actual delivery to the person, by registered or certified mail, or by overnight or second-day delivery.

Part III:  Send Your Bond Claim / Notice of NonPayment

If unpaid on the state construction project, those who are not in “privity” of contract with the prime contractor (i.e. you contracted with a subcontractor) must serve a written notice of nonpayment to the prime contractor and its surety.  This notice can only be served within a specific window of time:  It cannot be served any earlier than 45 days after first furnishing labor and/or materials to the project, and it cannot be served any later than 90 days after the last furnishing of labor and/or materials to the project.

This notice must be served to the prime contractor and surety pursuant to the requirements of F.S. §713.18, which allows for service by actual delivery to the person, by registered or certified mail, or by overnight or second-day delivery.

Part IV: File Lawsuit To Enforce Claim

After the “notice of nonpayment” is properly served, if this doesn’t produce payment, the claimant must proceed to bring an action to enforce the claim.  This action must be instituted against the contractor or the surety within 1 year of the last furnishing of materials or labor to the project.

The claimant has just a bit more time to bring the legal action for retainage payments due to it (although the claim for retainage must be included in the notice of non-payment, as this notice must segregate how much of the claimed amount is retainage).  The action to recover retainage must be brought within 120 days from the happening of a certain condition, such as the public entity has paid out retainage, the work is completed and the prime has sent its request for final payment, 160 days have passed since substantial completion, etc.

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Florida Bond Claims: How To Lien A State Or City Project
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Levelset
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