HOUSE OF REPRESENTATIVES STAFF ANALYSIS
BILL #: CS/CS/HB 331 Liens and Bonds
SPONSOR(S): Regulatory Reform & Economic Development Subcommittee, Civil Justice Subcommittee,
Overdorf
TIED BILLS: IDEN./SIM. BILLS: SB 624
REFERENCE ACTION ANALYST STAFF DIRECTOR or
BUDGET/POLICY CHIEF
1) Civil Justice Subcommittee 18 Y, 0 N, As CS Mawn Jones
2) Regulatory Reform & Economic Development 13 Y, 0 N, As CS Wright Anstead
Subcommittee
3) Judiciary Committee 21 Y, 0 N Mawn Kramer
SUMMARY ANALYSIS
Persons who provide services, labor, or materials for improving, repairing, or maintaining real property (except
public property) may place a construction lien on the property if they are not paid for their services in certain
situations and if they follow certain procedures set forth in ch. 713, F.S., Florida’s construction lien law.
CS/CS/HB 331:
Modifies the notice of commencement, notice of termination, and notice of nonpayment forms.
Allows licensed general or building contractors providing construction or program management services
to claim construction liens for such services.
Changes when a notice of termination must be recorded and served, and when such notice is effective.
Modifies service requirements for documents required by the construction lien law.
Modifies the available alternative forms of security that may be filed in lieu of a payment bond for public
projects.
Authorizes a person intending to make a claim against a payment bond to serve the surety with a copy
of the notice of nonpayment, instead of an original document.
Specifies that the methods for discharging a lien may also be used to release a lien, in whole or in part,
and modifies the requirements for recording a satisfaction or release of lien with the clerk’s office.
Increases the bond amount and documentation necessary to deposit or file with the clerk’s office to
transfer a lien to a security.
Entitles the prevailing party in an action to enforce a lien transferred to a security to recover reasonable
attorney fees.
Specifies that after a clerk’s office records a notice of contest of claim against a payment bond or a
notice of contest of lien and a certificate of service for such notice, the clerk must serve a copy of the
recorded notice on the lienor and on the owner or the owner’s attorney.
Authorizes a building permit applicant to provide the issuing authority with the clerk’s office official
records identifying information in lieu of a certified copy of the notice or a notarized statement of filing.
Increases the contract amount which excuses a building permit applicant from filing a copy of the notice
of commencement or an authorized alternative with the issuing authority, from $2,500 to $7,500.
Provides a method for computing time periods for recording a document or filing an action under the
construction lien law and tolls such time periods in emergency circumstances.
Repeals s. 713.25, F.S., an outdated provision relating to the applicability of ch. 65-456, L.O.F.
Modifies the definition of “clerk’s office” and defines “finance charge.”
The bill does not appear to have a fiscal impact on state or local governments.
The bill provides an effective date of October 1, 2023.
This docum ent does not reflect the intent or official position of the bill sponsor or House of Representatives .
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DATE: 3/23/2023
FULL ANALYSIS
I. SUBSTANTIVE ANALYSIS
A. EFFECT OF PROPOSED CHANGES:
Background
Florida law seeks to ensure that people working on construction projects are paid for their work. Any
person who provides services, labor, or materials for improving, repairing, or maintaining real property
(except public property) may place a construction lien1 on the property, provided the person complies
with statutory procedures.2 These procedures require the filing or serving of various documents,
including a:
Notice of Commencement;3
Notice to Owner;4
Claim of Lien;5
Notice of Termination;6
Waiver or Release of Lien;7
Notice of Contest of Lien;8
Contractor’s Final Payment Affidavit;9 and
Demands of Written Statement of Account.10
To record a construction lien on real property, the lienor must record a claim of lien with the clerk’s
office in the county where the property is located and serve the owner with the claim of lien within 15
days of recording the lien.11 If a claim of lien is not recorded, the lien is void to the extent that the failure
to record the claim prejudices any person entitled to rely on service of the claim of lien. 12
A person may file a claim of lien at any time during the progress of the work but may not file a claim of
lien later than 90 days after the person’s final furnishing of labor or materials. 13 A person may record a
single claim of lien for multiple services or materials provided to different properties as long as such
services or materials were provided under the same contract, the person is in privity with the owner,
and the properties have the same owner.14 However, a person may not record a single claim of lien for
multiple services or materials if there is more than one contract, even if the contracts for services and
materials are with the same owner.15
A construction lien extends to the right, title, and interest of the person who contracts for the
improvement to the extent such right, title, and interest exists at the improvement’s commencement or
1 A lien is a claim against property that evidences a debt, obligation, or duty. Fla. Jur. 2d Liens s. 37:1.
2 Ch. 713, F.S.
3 S. 713.13, F.S.
4 To secure construction lien rights, a person working on a construction project who is not in direct contract (“p rivity”) with the owner
must serve a notice to owner in the statutory form provided; laborers are exempt from this requirement. The notice informs th e owner
that someone with whom he or she is not in privity is providing services or materials on the proper ty and that such person expects the
owner to ensure he or she is paid. The notice must be served no later than 45 days after the person begins furnishing service s or
materials and before the date the owner disburses the final payment after the contractor h as furnished his or her final payment affidavit.
After receiving a notice to owner, the owner must obtain a waiver or release of lien from the notice’s sender before paying t he
contractor, unless a payment bond applies, or risk payments to the contractor constituting improper payments that leave the owner
liable to the notice sender if the contractor does not pay such person. Stocking Bldg. Supply of Florida, Inc. v. Soares Da Costa
Construction Services, LLC, 76 So. 3d 313 (Fla 3d DCA 2011); S. 713.06, F.S.
5 S. 713.08, F.S.
6 S. 713.132, F.S.
7 S. 713.20, F.S.
8 S. 713.22(2), F.S.
9 S. 713.06(3), F.S.
10 S. 713.16, F.S.
11 S. 713.08, F.S.
12 S. 713.08(4), F.S.
13 S. 713.08(5), F.S.
14 S. 713.09, F.S.
15 Id.; see also Lee v. All Florida Construction Co., 662 So. 2d 365, 366-67 (Fla. 5th DCA 1995).
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is acquired in the real property.16 However, when a lessee makes an improvement under an agreement
between the lessee and his or her lessor, the lien also extends to the lessor’s interest unless: 17
The lease is recorded in the official records of the county where the property is located before
the recording of a notice of commencement for improvements to the property and the lease’s
terms expressly prohibit such liability;
The lease’s terms expressly prohibit such liability, and a notice advising that leases for the
rental of premises on a property prohibit such liability has been recorded in the official records
of the county in which the property is located before the recording of a notice of commencement
for improvements to the premises and the notice includes specified information; or
The lessee is a mobile home owner who is leasing a mobile home lot in a mobile home park. 18
If a lease expressly provides that the lessor’s interest will not be subject to the construction liens
relating to improvements made by the lessee, the lessee must notify the contractor making any such
improvements of the provision, and the knowing and willful failure of the lessee to provide such notice
renders the contract voidable at the contractor’s option.19
Notice of Commencement
Before construction begins, a private property owner or the owner’s authorized agent must generally
file a notice of commencement with the clerk’s office20 and post a copy of the notice on the property to
be improved.21 The notice of commencement determines the priority of construction liens, provides
details needed to complete a notice to owner, establishes the date on which the statute of limitations
begins to run, and protects owners from double payments. 22
A notice of commencement must be substantially similar to the statutorily-authorized form and contain:
Descriptions of the real property to be improved and the improvements;
The name and address of the:
o Owner, fee simple title holder (if not the owner),23 contractor, and any person lending
money for the project, along with a description of the owner’s interest in the property;24
o Surety25 on a payment bond, if any, and the bond amount;
o Persons, designated by the owner, upon whom notices may be served or who may
receive a claim of lien;
The notice’s expiration date; and
A warning in uppercase type that the notice must be recorded, and that payments made after
the notice expires could be improper and lead to the owner paying twice. 26
Further, a building permit applicant must generally file with the issuing authority, before the first
inspection, either a certified copy of the recorded notice of commencement or a notarized statement
that the notice was filed for recording, along with a copy of the notice; however, the applicant is
excused from filing such a copy or statement with the issuing authority where the direct contract is for
16 S. 713.10(1), F.S.
17 Id.
18
S. 713.10(2)(b), F.S.
19 S. 713.10(2)(a), F.S.
20 “Clerk’s office” means the office of the clerk of the circuit court of the county in which the real property is located. S. 7 13.01(4), F.S.
21 A notice of commencement is not required for direct contracts for $2500 or less or for air conditioning or heating system rep air or
replacement for less than $7500. A notice of commencement is also not required for public construction project s because public
property is not lienable. Ss. 713.01(26), 713.02(5), 713.13, and 713.135(1)(d), F.S.
22 Stocking Bldg. Supply, So. 3d at 319; The Florida Senate Committee on Regulated Industries, Review of the Florida Construction
Lien Law, November 2007, http://archive.flsenate.gov/data/Publications/2008/Senate/reports/interim_reports/pdf/2008 -149ri.pdf (last
visited March 23, 2023); Fred Dudley, William A. Buzzett, & Deborah Kaveney Kearney, Construction Lien Law Reform: The
Equilib rium of Change, 18 Fla. St. U. L. Rev., 278 (1991).
23 Fee simple title is an interest in land that, being the broadest property interest allowed by law, endures until the current holder dies
without heirs. Black’s Law Dictionary (11th ed. 2019).
24 A lessee may contract for improvements as an owner but must be listed as the owner in the notice of commencement. S.
713.13(1)(a)3., F.S.
25 A surety guarantees the performance or obligations of a second party (the principal) to a third party (the obligee) under a three -party
contract. National Association of Security Bond Providers, What are Surety Bonds, https://www.nasbp.org/getabond/about-
surety#:~:text=A%20surety%20bond%20is%20a,third%20party%20(the%20obligee) (last visited March 23, 2023).
26 S. 713.13(1)(a)-(d), F.S.
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an amount less than $2,500.27 If a certified copy of the notice of commencement is not filed with the
issuing authority as required, the issuing authority may not perform or approve subsequent inspections
until the applicant files the certified copy; however, the issuing authority is not liable in any civil action
for failing to verify that the building permit applicant submitted a certified copy of the notice of
commencement.28
Payment Bonds and Related Notices
A payment bond is a type of surety bond that generally guarantees that all subcontractors, laborers,
and material suppliers will be paid for their work on or materials contributed to a construction project. 29
It forms a three-part contract between the owner, the contractor, and the surety to ensure that liens are
not filed on the property, serving as the security for payment in lieu of the typical right to claim a lien.
The payment bond must be furnished in at least the amount of the original contract price before
beginning the construction project, and a copy of the bond must be attached to the recorded notice of
commencement.30
For a private project, contractors are not obligated to obtain a payment bond, but current law requires
contractors to obtain a payment bond for public projects over $100,000.31 However, in lieu of the
payment bond, a contractor working on a public project may file with the state, county, city, or other
political authority an alternative form of security in the form of cash, a money order, a certified check, a
cashier’s check, an irrevocable letter of credit, or a security of a type listed in part II of chapter 625,
F.S., dealing with investments.32
Before paying a subcontractor, laborer, or material supplier, a contractor may request that such person
provide a waiver of right to claim against the payment bond. Such a waiver serves as a receipt
acknowledging payment for services performed or materials provided and waives the ability to seek
payment from the surety.33 Current law provides a statutory form for a waiver of right to claim against a
payment bond and prohibits a contractor from requiring anyone to sign a waiver that is substantially
different from the form.34
If the general contractor fails to pay a subcontractor, laborer, or material supplier, such person may
seek payment directly from the surety. In order to receive protection under a payment bond for a
project, a subcontractor or material supplier 35 not in privity with the contractor must serve the contractor
with a written notice of intent to seek protection under the bond. 36 Such notice must be served no later
than 45 days after the first furnishing of services or materials for the project. 37
An action to enforce a claim against the payment bond must be instituted against the contractor or the
surety within one year after the performance of the labor or completion of delivery of the materials or
supplies.38 However, if a claimant is no longer furnishing labor, services, or materials on a project, a
contractor may elect to shorten the time within which such an action must be commenced by serving a
notice of contest of claim against the payment bond on the claimant and recording the notice in the
clerk’s office along with a certificate of service.39 The claim of any claimant who is served with such
notice and who fails to file a lawsuit to enforce his or her claim against the payment bond within 60 days
of service is automatically extinguished.40
27 S. 713.135(1)(d), F.S.
28
S. 713.135(1)(d) and (3), F.S.
29 S. 713.23, F.S.
30 S. 713.23(1)(a), F.S.
31 S. 255.05(1)(d), F.S.
32 S. 255.05(7), F.S.
33 Ss. 255.05(2), and 713.235, F.S.
34 Id.
35 Laborers are exempt from this requirement. Ss. 255.05(2)(a)2., 337.18(1)(c), and 713.23(1)(c), F.S.
36 Id.
37 Ss. 255.05(2)(a)2. and 713.23(1)(c), F.S.
38 Ss. 255.05(10) and 713.23(1)(e), F.S.
39 S. 255.05(2)(a)1. and 713.23(1)(e), F.S.
40 Id.
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Transfer of Liens to Security
Any construction lien claimed may be transferred from the real property to a security by a person with
an interest in the real property or the contract under which the lien is claimed by either depositing
money or filing a bond with the clerk’s office.41 Cash deposited or a bond filed to transfer a lien must be
in an amount equal to the amount demanded in the lien, plus interest thereon at the legal rate for three
years, plus $1,000 or 25 percent of the demanded amount, whichever is greater.42 Once such a deposit
is made, the clerk must record a certificate showing the transfer of the lien from the real property to the
security, and upon the recording of such certificate, the real property is released from the lien, which is
transferred to the security.43
However, any