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Florida Enacts Changes to Construction Lien Law

Joy Spillis Lundeen & Kelly Ruane Melchiondo
Concept image of Contractors illustrating Florida Enacts Changes to Construction Lien Law That Will Impact Owners and ContractorsOn June 12, 2023, Florida Governor Ron DeSantis signed into law House Bill 331, which significantly modifies Florida’s Construction Lien Law, Chapter 713, Florida Statutes. Among the amendments that will take effect on October 1, 2023 is a new requirement that a lienor notify both a contractor and its surety, if applicable, of nonpayment claims, and an addition of language permitting arbitrators to award prevailing party fees in payment bond enforcement actions. We highlight these and the other major changes below.

Chapter 713.01.  Come October 1, 2023, the definition of “Contractor,” will include “a licensed general contractor or building contractor who provides construction management services, including scheduling and coordinating preconstruction and construction phases for the entire project, or who provides program management services, which include schedule control, cost control, and coordinating the provision or procurement of planning, design, and construction for the construction project.”

Chapter 713.132.  As amended, Chapter 713.132 will require a project owner to serve a copy of the notice of termination on each lienor that has a direct contract with the owner, and on each lienor that timely and properly served a notice to owner, before the owner records a notice of termination. A notice of termination served properly before the owner records the notice terminates the notice of commencement 30 days after the owner records the notice of termination in the public records, or on a later date stated in the recorded notice of termination.  

The owner must also serve the notice of termination upon any lienor without a direct contract with an owner, but that has timely served a notice to owner and began work before the owner recorded its notice of termination. Any termination served upon such a lienor will be effective 30 days after the owner serves the notice of termination.

Chapter 713.135.  This provision of the Construction Lien Law applies to authorities with jurisdiction over building permits. The amended version of this provision will require an authority that issues a building permit to require an applicant to file a certified copy of a notice of commencement with the issuing authority before the first inspection, if the direct contract is greater than $5,000.This increases the threshold amount from $2,500 to $5,000. 

Chapter 713.18.  The legislature added language to this provision, which governs the award of attorneys’ fees in any action brought to enforce a claim against a payment bond, to permit the arbitrator in a payment bond arbitration to award fees and determine the amount of the fees to be awarded. 

Chapter 713.21.  The amendments will also affect the satisfaction and release of construction liens. As of October 1, 2023, any satisfaction or release of a construction lien, recorded in the clerk’s office, must include the lienor’s notarized signature, and the official records’ reference number and recording date. 

Chapter 713.23.  Under the amended version of this provision, which governs claims made for nonpayment on payment bonds, a lienor must serve its notice of nonpayment on both the contractor and the contractor’s surety. The amendment will also affect the timing of a notice of nonpayment for equipment rental, which may not be served later than 90 days after the date that the rental equipment was on the site of the improvement and available for use.

Chapter 713.24.  This amendment will increase the amounts of any bonds for liens transferred to security, from “an amount equal to the amount demanded in such claim of lien, plus interest thereon at the legal rate for 3 years, plus $1,000 or 25 percent of the amount demanded in the claim of lien…” to “an amount equal to the amount demanded in such claim of lien, plus interest thereon at the legal rate for 3 years, plus $5,000 or 25 percent of the amount demanded in the claim of lien…”

Chapter 713.29.  Finally, the amended Construction Lien Law provides for prevailing party fees in actions brought to enforce liens, including liens that have been transferred to security. 
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