Generally speaking, when working on a private construction project in Florida, you must deliver a “Notice To Owner” to preserve your mechanics lien rights. Like any law, there are exceptions. This post reviews the rule, the exceptions and some best practices for your company.
Explaining Florida’s Notice To Owner Requirement
Many states have preliminary notice requirements, and they go by various names. In Florida, the preliminary notice is referred to as the “Notice to Owner” or “NTO.”
This notice must be sent by all parties who did not contract directly with the owner either before commending work or within 45 days of first furnishing labor or materials to the project. The notice must be delivered by certified mail or personal delivery, with evidence of delivery obtained. It’s important to not only deliver this notice, but to keep evidence of the delivery so you can later prove compliance with the requirement.
The Florida Notice to Owner must be sent to the — wait for it — owner! But, it’s common for contractors to overlook that the law requires it be sent “up the chain” as well, meaning that you should send a copy of this notice to the owner and every party between you and the owner in the contracting chain.
Insofar as the form is concerned, an example form is provided in the statutes: Fla. Stat. § 713.06(2)(c). One is available here for free download as well, or you can hire Zlien to prepare and deliver your Florida Notice to Owner.
Exceptions to Florida’s Notice To Owner Requirement
Rules always have exceptions, and folks are always looking for these exceptions. After all, if an exception to the Notice to Owner applies, it may save your company money in having to comply with the requirement, and it may also save your company’s lien rights if it forgot to send the notice.
Exception 1: You Contract With The Owner (Or Some Variation Thereof)
The primary exception to Florida’s Notice to Owner requirement is when you contract directly with the property owner, or some variation thereof.
This exception appears obvious at first blush, but it’s more complicated that that. Contracting with the owner includes direct contract with the actual property owner, but also includes contracting with the owner’s “agent” or with a general contractor who shares a “corporate identity” with the owner.
This exception is usually straight-forward, but there are some hairy situations that arise when the relationship between the owner and the general contractor is a little too close to disregard the possibility that the GC is the agent of the owner. It’s hard to rely on this exception, however, because it will all boil down to a judge’s later determination.
Exception 2: Laborers, Professionals & Site Workers
Laborers are the most protected class of mechanics lien claimants across the nation, and it’s no different in Florida, where they are excused from delivering a Notice to Owner. To qualify as a laborer, you must be performing labor at the site only, and not providing any materials.
Professionals are also excused from sending a Notice to Owner. These “professionals” include architects, engineers, land surveyors, mappers and landscape architects.
Finally, “site work” type of work gets a pass on the Florida Notice to Owner too. This is work done to the job site itself to make the site suitable for building, which includes site work, excavating and similar services.
Best Practice Is To Always Send The Notice To Owner
While the Florida Notice To Owner requirement does have some exceptions, it’s never a bad idea to send the notice. The exceptions cited above are all ambiguous at times, and can come down to a decision from a judge. This means your mechanics lien rights would be up in the air while the particular issue gets litigated, which would cost you time and money. The easy solution is to always error on the side of caution and always send your Notice to Owner.