
September 17, 2004 |
2004-R-0723 | |
FLORIDA’S LAW ON WAIVER OR RELEASE OF MECHANIC’S LIENS | ||
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By: Daniel Duffy, Principal Analyst | ||
You asked for a summary of Florida's law on waiver or release of mechanic's liens.
OVERVIEW
Florida has an extensive private sector construction lien law. In relation to a construction project, the law gives a lien on real property to anyone who provides professional services (e. g. architectural services), furnishes supplies or materials, or makes an improvement on the property. It establishes rules for determining the priority of liens. It identifies the types of lienors and creates exceptions. It sets different rules for contractors who have a contract directly with an owner (“in privity”) and for those who do not. It creates special rules for subdivisions and requires that certain mandatory provisions be in contracts between owners and contractors for work related to improvements on real property consisting on one to four single family dwellings.
Florida law creates a system of notices among owners, contractors, subcontractors, and sub-subcontractors under which they inform each other, as a prerequisite of perfecting a lien, of the nature and value of services provided. The law prescribes the forms for these notices. The law also requires the state’s licensing authority to write a summary of the law for owners (Lien Law Summary). It is enclosed.
The law requires payments to be made for undisputed labor, services, and materials to be made within 30 days and creates a procedure for enforcing payments.
It establishes a set of responsibilities for lenders to meet before they lend money to an owner. These include giving the owner a written notice that the owner should protect himself from having to pay for material or services twice by obtaining lien releases from each lienor who has sent a notice to the owner.
WAIVER OR RELEASE OF LIEN PROVISIONS (FLA. STAT. ANN § 713. 20)
Florida prohibits waiving the right to claim a lien in advance. It allows a lien right to be waived only to the extent of labor, services, or materials already provided. A waiver made before the labor, services, or materials have been provided is not enforceable.
The law explicitly allows waiving or releasing part of a lien either for (1) the labor, services, or material already provided or for (2) the labor, services, or materials provided through a certain date, subject to exceptions specified in the release.
The law prescribes a form that may be used when a lienor is required to execute a waiver or release in exchange for or to induce a progress payment. It provides spaces to state (1) the names of the owner, customer, and lienor; (2) the amount of money received and related to the waiver or release, (3) the property description, and (4) the date. It also prescribes a substantially similar form that may be used upon final payment. The law prohibits someone from requiring a lienor from using a different waiver or release form.
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