As a Florida construction professional, there are two primary ways to ensure that property owners pay in full for the labor and materials provided during the construction process: 1) mechanics liens and 2) bond claims. Due to the complexities of Florida lien laws, it is advised to contact a construction attorney in Sarasota to discuss the options that are available to you.
A mechanics lien, also commonly referred to as a construction lien, is a security interest that the contractor acquires in a property. The lien is held until the contractor receives payment in full for the services or materials that are provided during the course of a construction project. If not properly compensated the lien holder may be allowed to keep the property listed in the lien.
A bond claim, which is called a surety bond, is a financial guarantee that the principal will fulfill their obligations to an obligee. In the construction industry, it is typical that the prime contractor secures a bond with the subcontractors. This makes the prime contractor the obligee and the subcontractor the principal, who is responsible for completing all obligations. This ensures that the prime contractor will not be left with an unfinished project to show the property owner.
What to File
To determine which option should be filed, a contractor needs to know if the construction project is either public or private. The majority of public projects, those that are funded by a government agency, are bonded because the government does not want to risk giving up ownership of their property. For private property, a mechanics lien is generally used, however, it is not uncommon for private projects to be bonded. Be that as it may, a bonded private project may still be eligible for a mechanics lien.
To determine which type of protection is best for your construction project, contact a Sarasota construction lawyer. It is advised that you contact an attorney before entering into a construction agreement, to ensure that your right to payment is fully protected.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.