Service Area: Collection Services

Serving a Preliminary Notice in Minnesota

Posted on February 12, 2018 by - Mechanic's Liens & Bond Claims, Preliminary Notices & Construction Credit

Minnesota Construction Projects, Mechanic’s Lien Rights and the Preliminary Notice

The focus of today’s post is the preliminary notice for private projects in Minnesota.

First: Who Is Entitled to a Mechanic’s Lien & Should Serve a Preliminary Notice?

Per Minn. Stat. 514.01, the “usual suspects” are entitled to a lien filing. General contractors, subcontractors, material suppliers and those furnishing rental equipment.

“Whoever performs engineering or land surveying services with respect to real estate, or contributes to the improvement of real estate by performing labor, or furnishing skill, material or machinery for any of the purposes hereinafter stated, whether under contract with the owner of such real estate or at the instance of any agent, trustee, contractor or subcontractor of such owner…”

Is a Preliminary Notice Required?

Depending on where you fall in the ladder of supply, a preliminary notice may be required.

If you are a contractor who contracts with subcontractors or materials suppliers, you should include the notice within your written contract with the owner and serve a copy of the contract upon the owner. If no written contract exists, serve the notice upon the owner within 10 days of agreeing to work on the project.

If you are a subcontractor or material supplier, when contracting with the prime contractor or a subcontractor, serve notice upon the owner as soon as possible to trap funds, but within 45 days from first furnishing materials or services.

There may be circumstances in which a preliminary notice is not required:

– the project is non-agricultural and

– the project is not wholly residential and is more than 5,000 usable square feet or is to provide or add more than 5,000 total usable square feet of floor space, or

– a wholly residential project has more than four family units.

What Information Should Appear in the Notice?

Statute is specific regarding the contents and format of the notice. The notice should be in at least 10-point bold type, if printed, or in capital letters, if type written.

For contractors, who did not include notice within their contract, the notice should include the statutory language found in Minn. Stat. 514.011 Notice. Subd. 1 (a) & (b). Essentially, statute requires notifying the owner that unpaid parties within the ladder of supply may file a lien on the owner’s property and that the owner has a right to pay those parties directly with funds that would have been paid to the contractor.

For subcontractors & material suppliers, the preliminary notice should include the statutory language found in Minn. Stat. 514.011 Notice. Subd. 2. Aside from the statutory language, the notice should include your company’s name & address, the name & address of your customer, a description of the materials/services you are furnishing and an estimated contract amount.

Although the preliminary notice guidelines are specific, failure to strictly comply with the statutory requirements may not invalidate your lien.

“(b) A person entitled to a lien does not lose the right to the lien for failure to strictly comply with this subdivision if a good faith effort is made to comply, unless the owner or another lien claimant proves damage as a direct result of the failure to comply.”

Who Should Receive the Notice?

Whether contracting directly with the owner or further down the ladder of supply, the preliminary notice should be served upon the owner or the owner’s authorized agent.

If you are a material supplier, and are unsure who the project owner is, Minnesota statute specifically calls out your right to request the information from the contractor. If the contractor fails to supply the information, the contractor becomes liable for “…[A]ny actual damages sustained or expenses incurred by the subcontractor or material supplier because of the contractor’s failure to provide the information, plus reasonable attorney fees and costs.”

How Should the Notice Be Delivered?

In Minnesota, the preliminary notice should be served via personal service or certified mail. As a best practice, if sending via certified mail, pay the additional fee for “return receipt requested.”

If Notice is Required, the Lien is Unpaid Balance

If the 45-day notice is required, the lien is enforceable for the unpaid portion of the contract at the time the 45-day notice is served. On commercial projects, if the 45-day notice is not required, the lien is enforceable for the full amount owed, regardless of payments made by the owner. 

Help!

Have questions not covered in today’s post? Contact us today!

Is Pay-if-Paid Enforceable in Kentucky?

Posted on February 9, 2018 by - In Other Commercial Credit News

Supreme Court in Kentucky Decides Pay-If-Paid is Enforceable

Is pay-if-paid enforceable in Kentucky? According to one recent Supreme Court decision, yes.

We’ve previously discussed pay-when-paid and pay-if-paid, otherwise known as contingent payment clauses. But, here’s a quick refresher on pay-if-paid.

Pay-if-paid is generally interpreted to mean the subcontractor will receive payment from the general contractor IF the general contractor is paid by the owner. In other words, if the owner fails to pay the general contractor, the general contractor doesn’t pay the subcontractor.

The Court Enforced the Contract

In Superior Steel, Inc. v. The Ascent at Roebling’s Bridge, LLC, the contractual provision in question lies within the contract between the subcontractor and the construction manager.

Essentially, the subcontractor furnished outside the scope of the original contract and did not execute change orders. Then, when the construction manager sought payment for the additional work from the owner, the owner refused to remit payment to the construction manager. Thus, based on the contractual terms between the construction manager and subcontractor, the construction manager did not have to pay the subcontractor.

In its decision, the court provided an example of a pay-if-paid clause:

“A typical `pay-if-paid’ clause might read: `Contractor’s receipt of payment from the owner is a condition precedent to contractor’s obligation to make payment to the subcontractor; the subcontractor expressly assumes the risk of the owner’s nonpayment and the subcontract price includes this risk.”‘

Then, the court reviewed the plain language that appears within the contract. (Keep in mind, not only has the owner failed to pay the construction manager, but the subcontractor also failed to execute change orders.)

“[n]o additional compensation shall be paid by the Contractor to the Subcontractor for any claim arising out of the performance of this Subcontract, unless the Contractor has collected corresponding additional compensation from the owner, or other party involved, or unless by written agreement from the Contractor to the Subcontractor prior to the execution of the Work performed under said claim, which agreement and work order must be signed by an officer of the Contractor.”

Unjust Enrichment – Alternative Remedy

Author, Jeffrey R. Appelbaum, reviewed this case in his article Kentucky Supreme Court Enforces Pay-if-Paid Provision. In his review, he mentions that although the court enforced the pay-if-paid provision, the subcontractor is permitted to pursue unjust enrichment against the owner.

“[T]he court also relied on the pay-if-paid provision to reinstate the unjust enrichment verdict against the owner, concluding that although the equitable remedy of unjust enrichment does not exist when there is a contractual remedy, the existence of the pay-if-paid clause in the subcontract blocked the subcontractor from pursuing a contract remedy. As such, the subcontractor was permitted to pursue its claim for unjust enrichment against the owner, and that portion of the trial court’s judgment was reinstated.”

Two Takeaways

  • Always review your contract! Even when a state’s statute implies a clause is unenforceable

Kentucky Fairness in Construction Act “371.405 (2) The following provisions in a contract for construction shall be against the public policy of this Commonwealth and shall be void and unenforceable: (b): A provision that purports to waive, release, or extinguish rights provided by KRS Chapter 376, with the exception of partial waivers of lien rights provided by the contractor or subcontractor for progress payments”

  • If performing additional work or supplying additional materials, outside the original agreed upon contract, get approval for the additional work in writing!

New York Lien Discharged by Bond

Posted on February 5, 2018 by - Mechanic's Liens & Bond Claims

In New York, a Mechanic’s Lien Discharged by a Payment Bond is Still a Lien

In New York, on private commercial projects, a mechanic’s lien must either be extended or enforced within one year from the date the lien was filed. But, what happens if a payment bond is substituted for the lien? According to one recent court opinion, lien deadlines still apply.

Mechanic’s Lien Guide for Private Commercial Projects in New York

Generally, in New York, there is no preliminary notice required, though serving a non-statutory notice is recommended.

The mechanic’s lien deadline varies based on project type: commercial or residential. For commercial projects, claimants should file the lien within 8 months from last furnishing materials or services. The lien should be served upon the owner, the prime contractor, and the debtor, within 5 days before or 30 days after filing the lien. And, proof of service should be filed with the County Clerk within 35 days after the lien is filed.

Words of caution:  New York is an unpaid balance lien state and the lien is enforceable only for the unpaid portion of the contract, either what is owed by the owner or what is owed to your customer.  File the lien as early as possible to ensure funds are still available.

If you remain unpaid after filing the lien, file suit to enforce the lien within 1 year from the date the lien was filed, or, within the same time period, file an extension of lien.

EZ Runer Const. Corp. v. Blue Nirvana, LLC, 2017 NY Slip Op 31663 – NY: Supreme Court 2017

Let’s review the above case. First, here’s a quick look at the relevant parties:

– Lien Claimant (plaintiff): EZ Runer Construction Corp. (EZ)

– Property Owner (defendant): Blue Nirvana, LLC (Blue)

– Surety (defendant): Suretec Insurance Company (Suretec)

EZ furnished & installed plumbing to the real property owned by Blue. When Blue failed to pay, EZ filed a mechanic’s lien on October 1, 2014, in the amount of $14,712.43.

In July 2015, Blue filed a payment bond, with Suretec as the surety, to discharge EZ’s lien. Once the bond was filed, EZ’s lien was no longer against the property, but was instead against the bond.

Per New York statute, EZ had until October 1, 2015 to file a lien extension or to proceed with suit to enforce their lien, otherwise their lien would be extinguished.

“No lien specified in this article shall be a lien for a longer period than one year after the notice of lien has been filed… or unless an extension to such lien… is filed with the county clerk of the county in which the notice of lien is filed within one year from the filing of the original notice of lien…” – New York § 17

Unfortunately, EZ failed to file an extension or to proceed with suit by the October 1, 2015 deadline. Blue petitioned the court to extinguish EZ’s lien because EZ failed to comply with statute, and the court sided with Blue.

Lien Statute Applies, even if Bond is Filed?

Yes, in New York, even if a bond is filed to discharge the lien, deadlines remain the same.

“The claimant in order to perfect his claim shall within the time prescribed in this chapter for the filing of a notice of lien, file a notice of claim in the office of the clerk of the county where such bond is filed. “- § 37 (5) Bond to discharge all liens.

Another example where the statute does not vary is New Jersey. In New Jersey, when a lien is bonded off, the deadlines associated with suit to enforce the claim do not change. Whether a claimant is enforcing a lien or a claim against the bond, the deadline for enforcement remains within 1 year from last furnishing materials or services.

There are some states where statutory guidelines shift when a bond is filed to prevent or discharge a lien. For example, in Texas, if a lien is bonded off, the deadline for suit to enforce the claim varies, depending upon when the bond was recorded:

53. Stat. Sec. 53.208. ACTION ON BOND.

(a) A claimant may sue the principal and surety on the bond…

(d) If the bond is recorded at the time the lien is filed, the claimant must sue on the bond within one year following perfection of his claim. If the bond is not recorded at the time the lien is filed, the claimant must sue on the bond within two years following perfection of his claim.

In situations where a bond or other security is substituted for a lien on real property, carefully review the state’s statute.

It’s a Warning

New York statute is concise and appears to leave little room for interpretation; perhaps a blessing and a curse for those furnishing to commercial construction projects. It is imperative that would-be claimants be familiar with and follow the statutory requirements as prescribed.

Free Forms Online – Proceed with Caution

Posted on January 26, 2018 by - In Other Commercial Credit News

Be Careful When Using Free Forms to Secure Lien & Bond Claim Rights

There are creditors who prefer to send preliminary notices & file mechanic’s liens, on their own, via free forms they retrieve online. In the digital age, there is certainly no shortage of free information. You can access a variety of free forms from a variety of sources, including county recorder sites and legal service companies.

Just be careful – don’t get trapped by “I saw it on the internet, so it must be true.” If you are going to secure your lien/bond claim rights, by completing online documents/free forms, please ensure the documents meet statutory format & content requirements.

Ensure Documents Meet Statutory Requirements – Including Formatting

A case in Minnesota immediately comes to mind. The lien claimant served the preliminary notice; unfortunately, the notice did not meet Minnesota’s statutory requirements. In Minnesota, the preliminary notice “…whether included in a written contract or separately given, must be in at least 10-point bold type, if printed, or in capital letters, if typewritten”. (MN 514.011 Notice)

The claimant’s notice met the font size requirement, but did not include the required bold font or capital letters. The failure to meet the requirements lead the trial court to invalidate the claimant’s lien.

You may think “Whoa, that’s a bit extreme” and I would be inclined to agree with you, but, statute = law and the law leaves very little wiggle room.

In my experience, some states are less concerned about the format of a document and, instead, focus on the content of the document. But, there are states, like Minnesota, that follow a rigid set of laws.

Another state with specific requirements? Wisconsin

In Wisconsin, statute requires the notice “…whether included in a written contract or separately given, shall be in at least 8-point bold type, if printed, or in capital letters, if typewritten.”

Be Cautious with Plug-n-Play Forms – You Get What You Put In

Aside from incorrect format, creditors may fail to complete the documents in accordance with statute. It’s not enough to meet a state’s required formatting – if you fail to identify a party, you could jeopardize your rights.

Author John R. Lockard has noticed the same pitfalls. In his article, The Perils of Online Mechanic’s Lien Services, he discusses reviewing a lien prepared by an online provider. These are the issues he uncovered when reviewing a Virginia memorandum for mechanic’s lien:

“- It did not conform to the format included in the Code of Virginia;

– It failed to identify the general contractor or the subcontractor for the project as required by the Code of Virginia; and

– It failed to identify the correct address or parcel of property upon which the work was performed.”

Obviously, and as Lockard further discusses, failing to correctly identify the property to be liened is significant. If the address is incorrect, the validity of the lien is questionable at best.

Choose Carefully

Whether you secure your rights on your own or with the assistance of a service provider, choose carefully. Vet the source and if concerned, seek a legal opinion.

Ensuring payment in the construction industry is already a challenge, don’t jeopardize your rights because you failed to adhere to statutory requirements.

Prompt Payment: Which Applies, State or Federal Statute?

Posted on January 19, 2018 by - In Other Commercial Credit News

Prompt Payment: Which Applies, State or Federal Statute?

In Arizona, prompt payment statute generally dictates that a project owner should remit payment to the General Contractor within seven days after the approved billing cycle. The General Contractor should, in turn, pay its subcontractors/suppliers within seven days of receipt of the owner’s payment.

Here’s an excerpt from Arizona’s statute (Ariz. Rev. Stat. Ann. 32-1129 et seq.):

32-1129.01. A. Progress payments by owner; conditions; interest

…Except as provided in subsection C of this section, the owner shall make progress payments to the contractor within seven days after the date the billing or estimate is certified and approved pursuant to subsection D of this section…

32-1129.02. B. Performance and payment by contractor, subcontractor or material supplier; conditions; interest

…[T]he contractor shall pay to its subcontractors or material suppliers and each subcontractor shall pay to its subcontractors or material suppliers, within seven days of receipt by the contractor or subcontractor of each progress payment, retention release or final payment, the full amount received…

This Statute Doesn’t Apply to Subcontractors Furnishing to Federal Projects – Unfortunately

Keep in mind, the information provided above is Arizona’s statute, not the Federal Government’s statute.

Prompt pay statutes differ, much like securing bond claim rights on a public project may differ from securing bond claim rights on a federal project.

The Project: Provide & Install Road Signs at Grand Canyon National Park

In short, the owner hired a contractor to provide materials & installation services. The contractor hired a subcontractor to furnish the materials.

The contractor received its payment from the owner, but withheld some funds from the subcontractor due to performance issues. The subcontractor proceeded with a suit action, claiming the contractor violated the prompt pay statute.

The superior court agreed with the subcontractor, but the appeals court reversed the superior court ruling, based on how statute defines a project owner.

“The Court of Appeals reasoned that an “owner,” as defined in the Act, does not include the federal government or its agencies, and thus found the Act inapplicable when the contract at issue is a federal work project.” – quote from  Arizona Prompt Pay Act Held Inapplicable to Federal Construction Project, authors P. Douglas Folk & Zara Torosyan

The Lesson

Don’t assume anything. Recognize that statutes vary by state and project type. If you have concerns about which statutes apply to a project, contact us!

Residential Projects & Mechanic’s Lien Rights

Posted on January 8, 2018 by - Mechanic's Liens & Bond Claims, Preliminary Notices & Construction Credit

Secure Mechanic’s Lien Rights on Residential Projects

If you are furnishing to a residential project, review preliminary notice & mechanic’s lien requirements carefully.

First: Define Residential

Each state may define residential differently. Here are a few examples:

Idaho defines residential as an “owner or nonowner occupied dwelling of 1-4 units”

45-525. (b) “Residential real property” shall include owner and nonowner occupied real property consisting of not less than one (1) nor more than four (4) dwelling units.

Illinois defines residential is an “owner-occupied single-family residence” and in New York, residential is a “single family dwelling.”

Generally, state statutes do not consider apartments to be residential, but Nevada statute specifically identifies apartments as residential.

NRS 108.226-6. Except as otherwise provided in subsection 7, if a work of improvement involves the construction, alteration or repair of multifamily or single-family residences, including, without limitation, apartment houses…

Ohio’s residential statute includes condominiums, plus it identifies various improvements to property “adjacent” to the residential dwellings.

1311.011 – (1) …[F]or the improvement of any single- or double-family dwelling or portion of the dwelling or a residential unit of any condominium property that has been submitted to the provisions of Chapter 5311. of the Revised Code; an addition to any land; or the improvement of driveways, sidewalks, swimming pools, porches, garages, carports, landscaping, fences, fallout shelters, siding, roofing, storm windows, awnings, and other improvements that are adjacent to single- or double-family dwellings or upon lands that are adjacent to single- or double-family dwellings or residential units of condominium property, if the dwelling, residential unit of condominium property, or land is used or is intended to be used as a personal residence by the owner, part owner, or lessee.

This leads us to the next question: Are Apartments & Condominiums Residential?

Unfortunately, there is no blanket rule on what is or isn’t residential. Of the 5 states mentioned above, 1 specifically mentions condos & 1 specifically mentions residential — and yet all 5 are still different!

As a best practice, carefully review statute to see whether apartments and/or condominiums are considered residential. It’s also important to confirm if you are furnishing to one building or multiple buildings, and whether furnishing to common area or individual units. And, if furnishing to individual units, who contracted for the improvement – the homeowner’s association or the individual owner?  Of course, when in doubt, seek a legal opinion.

If Furnishing to Condos, Be Prepared

If you are furnishing to condominiums, there are additional variables to consider. As I just mentioned, it’s important to know whether you furnished to individual units and/or common areas.

If any of the various lots/units are sold to an individual owner prior to filing a lien, more than one lien could be necessary. The lien may have to be served on multiple owners and multiple liens may be required if work was done in individual units.

Multiple liens + multiple units + multiple owners = the lien may be more expensive due to extensive title work and service upon multiple parties, etc.

45 States Require a Preliminary Notice or Notice of Non-Payment on Commercial and/or Residential Projects

Of those 45 states, 17 states have separate requirements specific to residential projects. The differing requirements could vary from a type of preliminary notice, a shortened deadline, or even limited rights based on who you sold to.

Which states Have a Notice Requirement Specific to Residential Projects?

The following states have a notice requirement specific to residential projects: Arkansas, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Maine, Mississippi, Missouri, Montana, Nebraska, Nevada, New Jersey, Texas, Virginia, Washington & Wisconsin.

Unpaid Balance Lien State vs. Full Balance Lien State

Another big difference on residential projects is that the lien may be limited to the unpaid balance being held by the homeowner, even though a full balance lien may be available on commercial projects. Always check statute & consider filing your lien sooner rather than later.

Properly Perfected UCC and Repossession

Posted on December 18, 2017 by - UCC Financing Statements

Can a Properly Perfected UCC Really Give Me the Right to Repossess?

Yes, a properly perfected security interest and proof of debtor default may afford you the right to repossess the collateral. Today’s post reviews a recent case that demonstrates the power of a properly perfected UCC.

In CNH INDUSTRIAL CAPITAL, AMERICA, LLC v. T & P FARMS, LLC, Dist. Court, ND Mississippi 2017, the court granted the Secured Party the right to repossess its equipment because it had 1.) proven the debtor defaulted on the contract and 2.) properly perfected a security interest through UCC Financing Statements.

Background: The Contract, The UCC-1s & The Replevin

In 2015, the debtor, T & P Farms, LLC (T & P) purchased over $1M in farming equipment from Medlin Equipment Company of Mississippi County (Medlin).

According to the court opinion, there were 4 pieces of equipment sold, and each sale was “…evidenced by a Retail Installment Sale Contract and Security Agreement.” (3 of the 4 sales were addressed in the replevin action.)

Included in the contract, aside from the security language and terms of the sale, was a clause regarding debtor default: “the seller has the right to ‘take possession of all Collateral, without notice or hearing…’” and Medlin assigned its interest in the equipment to CNH Industrial Capital America, LLC (CNH). Subsequently, a PMSI filing was properly perfected, by CNH, for each sale/contract.

By the end of 2016, the debtor had stopped making the agreed upon monthly payments and in May 2017, CNH filed a replevin action.

What is Replevin Action?

Wex Legal Dictionary defines replevin as the action used by creditors to repossess collateral from debtors in default. “A writ authorizing the retaking of property by its rightful owner (i.e., the remedy sought by replevin actions).”

The rules of replevin may vary by jurisdiction and this case looks to Mississippi statute (Section 11-37-101 of the Mississippi Code). According to the court opinion, a replevin action requires a declaration under oath to include:

(a) A description of any personal property;

(b) The value thereof, giving the value of each separate article and the value of the total of all articles;

(c) The plaintiff is entitled to the immediate possession thereof, setting forth all facts and circumstances upon which the plaintiff relies for his claim, and exhibiting all contracts and documents evidencing his claim;

(d) That the property is in the possession of the defendant; and

(e) That the defendant wrongfully took and detains or wrongfully detains the same

The Secured Party Prevailed

When a replevin action is filed, the party filing the action needs to prove their right to repossess the collateral. In this case, the Secured Party filed the action, then the Secured Party proved its properly perfected security interest as well as the default of its debtor.

“A plaintiff in a replevin action establishes the right to immediate possession by demonstrating a default on a purchase contract and a perfected security interest in the collateral.”

The debtor is afforded an opportunity to defend against the repossession. The debtor asked the court to consider equitable defense (a defense based on fairness, not law), based on the debtor’s need for the equipment to maintain his business and support his family.  The debtor further added he should not have to pay for the equipment, because the equipment was faulty.  Unfortunately, the debtor’s defense wasn’t persuasive enough.

“While a rule of equity may play some role in this determination, such as where a party claims an equitable lien in the subject of the action, T & P has not cited, and this Court has not found, any authority which supports the proposition that a possessory interest in collateral may be equitably created by either the condition of collateral unrelated to the existence of a default or the need for continued possession.”

CNH properly perfected its security interest and successfully established the debtor’s default, therefore, the court granted CNH the right to repossess the equipment.

UCC for the win!

Substantial Compliance with Florida Lien Law

Posted on November 17, 2017 by - In Other Commercial Credit News

Substantial Compliance with Florida Lien Law & Unfortunate Irony

I know the saying is “Don’t mess with Texas.” But, would-be mechanic’s lien claimants shouldn’t mess with Florida! Florida statute is concise and there is little room for error. For example, the Notice to Owner must be received within 45 days from first furnishing — not mailed within 45 days, received.

Fortunately, however, one subcontractor prevailed based on the court’s decision that the subcontractor substantially complied with statute.

The Case of the Notice of Commencement Mix-Up

According to the court decision, the project owner hired two General Contractors for improvements to the same property. One GC (GC-1) was renovating lodges & the other GC (GC-2) was renovating the clubhouse.

As you know, Florida requires Notices of Commencement for construction projects. In this case, the project owner filed two Notices of Commencement – one for the lodges & one for the clubhouse.

The subcontractor went to the job site to obtain the Notice of Commencement from the owner. Then, once it had the Notice of Commencement, the subcontractor served a timely Notice to Owner upon all parties identified within the Notice of Commencement.

It was later discovered, by GC-2 (the subcontractor’s customer), the owner had provided the subcontractor with the wrong Notice of Commencement. The subcontractor was notified of the error and said it would amend its Notice to Owner to include the correct GC. But, the subcontractor failed to serve an amended Notice to Owner.

Owner Argued the Notice to Owner was Invalid

The subcontractor filed a mechanic’s lien for an unpaid balance of $32,535.87 and subsequently sought to enforce its lien. The owner argued the subcontractor’s lien was invalid, because the subcontractor did not serve the Notice to Owner on the correct parties.

Fortunately for the subcontractor, the court determined the subcontractor substantially complied with statute.

In When Substantial Compliance ‘Trumps’ Strict Construction of Florida Lien Laws, author Amandeep Kahlon explains 4 key points the court used to determine that the subcontractor substantially complied with statute.

“(1) The defect in the NTO resulted from the owner’s providing the subcontractor with a notice of commencement that listed the wrong general contractor;

(2) the correct general contractor, designated by the owner for receipt of the NTO, received actual and timely notice that the subcontractor was supplying materials to the project;

(3) the general contractor treated the subcontractor as a potential lienor during the performance of the work by having the subcontractor attend meetings and sign partial lien waivers in requesting payments; and,

(4) the owner could not demonstrate any adverse impact caused by the error on the NTO.”

Unfortunate Irony

Do you know what the unfortunate irony is? As a best practice, the subcontractor goes to jobsites to obtain Notices of Commencement, directly from the owner, to ensure it has the correct Notice of Commencement for completing its Notice to Owner.

Take It Easy Florida

Florida is strict with statute compliance, however, as Kahlon says, “Florida courts may go to great lengths to preserve a subcontractor’s lien rights.” But don’t bank on Florida’s flexibility; familiarize yourself with and adhere to the statutory requirements.