Construction & Real Estate

The new E204 Sustainable Projects Exhibit addresses the risks and responsibilities unique to projects involving sustainable design and construction. The AIA has taken many of the provisions
found in various AIA contract documents related to sustainable projects and has created a single exhibit. The procedures and terminology related to sustainable projects is identical the former provisions, but now those provisions are organized in a single exhibit. The E204 has been developed for use on projects in which the Sustainable Objective includes obtaining a Sustainability Certification, such as LEED® (Leadership in Energy and Environmental Design), or those in which the Sustainable Objective is based on incorporation of performance-based sustainable design or construction elements.

Contractors should make sure to review and understand the E204 as the Contractor is responsible for performing those Sustainable Measures assigned to the Contractor by the Sustainability Plan. While E204 does not require the Contractor to guarantee achievement of the Sustainable Objective, the Contractor will be responsible for failure to perform in accordance with the Contract Documents, including the Sustainability Plan.


W Mason is an partner with the law firm Fox Rothschild LLP. W is Board Certified in Construction Law by the Florida Bar Association. W focuses his practice on construction and business litigation. You can reach W at (561) 804-4432 or wmason@foxrothschild.com.

The 2017 revisions to the A201 improves the Contractor’s ability to request and obtain financial information from the owner throughout the project. On most projects, Owner’s typically create a single purpose legal entity, usually an LLC, that owns the real property where construction takes place. The legal entity typically enters into the construction contract with the Contractor. The A201 recognizes that the entity entering in to the construction Contract on behalf of the Owner most likely has little or no assets. As such, it provides the Contractor with the ability to request reasonable evidence of the Owner’s ability to pay.

The 2017 revisions of Section 2.2 continues to allow the Contractor to request reasonable evidence (1) prior to commencement, (2) after failure to make a timely payment, (3) after a material change in the work that materially affected the contract sum, or (4) after identification of a reasonable concern over the Owner’s ability to pay. While the 2007 A201 did not impose an express timeline on the Owner or a consequence for the Owner’s failure to provide the reasonable evidence, the 2017 revision requires the Owner to provide the reasonable evidence within 14 days after the Contractor’s request. If the Owner fails to provide reasonable evidence within 14 days, the Contractor may stop work. If the request is made due to a change materially affecting the Contract sum, the Contractor may only stop the work related to the change. Significantly, the 2017 A201 expressly provides that the contract time and sum shall be increased by the amount of the Contractor’s reasonable costs and delay, plus interest. Given that Section 2.2 of the 2017 A201 has more “teeth” in favor of the Contractor, practitioners representing owners may want to consider revisions to Section 2.2 accordingly.


W Mason is an partner with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W is Board Certified in Construction Law by the Florida Bar Association. W focuses his practice on construction and commercial litigation throughout Florida. You can reach W at (561) 804-4432 or wmason@foxrothschild.com.

Because of advancements in the use of digital technology in the administration of construction contracts, the 2017 AIA documents now default to the AIA’s Digital Data Use and Transmission protocol established in 2013 as set forth in the E203. Section 1.8 of the A201 now provides that the contractor’s reliance on BIM modeling will be at its “sole risk and without liability of any other party” unless the parties use AIA E203 and G202 BIM Modeling documents. Clearly, this provision allocates significant risk to the contractor. Contractors’ and their attorneys should consider modifying this language if the AIA digital transmission documents are not agreed to and utilized by the parties.

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W Mason is an partner with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W is Board Certified in Construction Law by the Florida Bar Association. W focuses his practice on construction and commercial litigation throughout Florida. You can reach W at (561) 804-4432 or wmason@foxrothschild.com.

The form and contents of a claim of lien are set forth in Fla. Stat. § 713.08. The claim of lien must expressly state:

  • the name of the lienor and the address where notices or process under the Construction Lien Law may be served on the lienor. Fla. Stat. § 713.08(1)(a).
  • the name of the person with whom the lienor contracted or by whom he or she was employed. Fla. Stat. § 713.08(1)(b).
  • the labor, services, or materials furnished and the contract price or value thereof. Materials specially fabricated at a place other than the site of the improvement for incorporation in the improvement but not so incorporated and the contract price or value thereof shall be separately stated in the claim of lien. Fla. Stat. § 713.08(1)(c).
  • a description of the real property sufficient for identification. Fla. Stat. § 713.08(1)(d).
  • the name of the owner. Fla. Stat. § 713.08(1)(e).
  • the time when the first and the last item of labor or service or materials was furnished. Fla. Stat. § 713.08(1)(f).
  • the amount unpaid to the lienor for labor, services, or materials and for unpaid finance charges due under the lienor’s contract. Fla. Stat. § 713.08(1)(g).
  • if the lien is claimed by a person not in privity with the owner, the date and method of service of the notice to owner. If the lien is claimed by a person not in privity with the contractor or subcontractor, the date and method of service of the copy of the notice on the contractor or subcontractor. Fla. Stat. § 713.08(1)(h).

The claim of lien may be prepared by the lienor or the lienor’s employee or attorney and must be signed and sworn to or affirmed by the lienor or his or her agent acquainted with the facts stated. See Stunkel v. Gazebo Landscaping Design, Inc., 660 So. 2d 623 (Fla. 1995).

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W Mason is an partner with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W is Board Certified in Construction Law by the Florida Bar Association. W focuses his practice on construction and commercial litigation throughout Florida. You can reach W at (561) 804-4432 or wmason@foxrothschild.com.

Miami is know for fun, sun, beaches and is a top spot for people looking to vacation or get together with friends or family for reunions and parties.  As a result, Miami-Dade County has been one of the busiest areas for peer-to-peer short term rentals.   The more short term rentals in a neighborhood the more complaints from neighbors regarding noise, parking, trash and other concerns.

Back in April, Miami-Dade reached agreement with Air BnB to collect bed taxes on the short term rentals listed on their platform.

Following the deal on taxes, Miami-Dade has now imposed regulations on the short-term rental market.

The new requirements include the following:

  • Hosts must apply for a certificate of use, which includes a “minimal” application fee.  Applicants will have to provide contact information for the property owner (who is also liable for any violations under the ordinance) and the short-term rental host, as well as the platform where the vacation rental will be listed.
  • In their applications, hosts will also have to certify that they will be collecting and remitting local tourist and state taxes, have permission from the property owner to rent short-term, carry insurance coverage on the property and have a vacation rental license with the Florida Department of Business and Professional Regulation.
  • Hosts will also have to acknowledge that the property owner is aware he or she risks losing a homestead exemption by renting short-term.
  • The certificate of use must be renewed annually and will be revoked, with few exceptions, if the property has three or more violations in the preceding 12 months.
  • If a host owns property within 2,500 feet from a school, the host will be required to ensure that a prospective guest is not a registered sexual offender or sexual predator.
  • Hosts must also maintain a register with the names and dates of all guests who stay at the home or apartment — including people invited to the property by the guests.  The maximum overnight occupancy at any short-term rental will not be permitted to exceed two people per room, plus two per property for a maximum of 12.  During the day, capacity is limited to 16 people.  This rule is designed to combat the problems with AirBnB “party houses” and other overcrowding problems.
  • Finally guests are expected to follow standard garbage procedures, noise restrictions (including no amplified sound outdoors), public nuisance laws and rules for pets, in coordination with the host. Guest parking is limited to two cars at a time on the property or on the street.  Again, violations are the responsibility of the property owner and can imperil the renewal of the certificate of use.
  • Fines for violations range from $100 for a first offense to $2,500 for a third offense within 24 months.  Five percent of all money collected from violations or fines will go into Miami-Dade’s Affordable Housing Trust.

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Dori K. Stibolt is a partner with the law firm of Fox Rothschild LLP.  Dori defends and counsels management in labor and employment litigation matters pertaining to wage and overtime claims, discrimination, harassment, retaliation, leave/restraint, and whistle-blower claims.  You can contact Dori at 561-804-4417 or dstibolt@foxrothschild.com.

Sacha Boegem is an experienced litigator in the West Palm Beach Fox Rothschild office.  He focuses his practice on a wide range of commercial litigation matters, including business disputes and torts, banking/financial services industry litigation, trust and estate litigation, and supplier-distributor litigation and advising.  Below is Sacha’s first post on the South Florida Trial Practice blog.  We welcome Sacha to the blog and look forward to future posts. For anyone with questions or comments regarding this post, you can reach you can contact Sacha at 561-804-4437 or sboegem@foxrothschild.com.

In an opinion released April 22, 2015 Florida’s First District Court of Appeals upheld a trial court’s ruling that Section 713.3471(2) of Florida’s Construction Lien Law precluded common law remedies.  See Jax Utilities Mgmt., Inc. v. Hancock Bank, No. 1D14-664, 2015 WL 1809322, at *5 (Fla. 1st DCA Apr. 22, 2015).  This section sets forth certain notice requirements that construction loan lenders must comply with if they make “a final determination, prior to the distribution of all funds available under a construction loan, that the lender will cease further advances pursuant to the loan.”  Fla. Stat. § 713.3471(2)(a).  The statute also provides that a lender has no liability if it complies with the statute, and provides a mechanism for determining damages if a lender fails to comply.  Fla. Stat. § 713.3471(2)(a) and (b).

As the First District Court of Appeal explained on this issue of first impression for a Florida appellate court, “the plain language of section 713.3471(2) evinces a legislative intent to displace the common law remedies and the statute is so repugnant to common law remedies that the two cannot coexist.”  In Jax Utilities, even though the record did not indicate that the lender had served proper notice under the statute, plaintiff Jax elected not to bring a statutory claim and instead sued the lender for equitable lien and unjust enrichment.  The trial court found that the statute precluded Jax’s common law claims and entered summary judgment for the lender, which the Court of Appeals upheld.

This opinion has not yet been released for publication in the permanent law reports and thus is still subject to revision or withdrawal.  Assuming it stands, however, the opinion potentially provides construction loan lenders with a way to avoid or have dismissed common law claims against them for their alleged failure to provide the statutorily-mandated notice, and limits their liability to the measure of damages provided for in the statute in instances where they are found to have violated the statute.

Service of notices permitted or required under the Construction Lien Law, or copies of notices when so permitted or required, unless otherwise specifically provided, must be made:

  1. by actual delivery to the person to be served; if a partnership, to one of the partners; if a corporation, to an officer, director, managing agent, or business agent; or, if a limited liability company, to a member or manager; or
  2. by common carrier delivery service or by registered, Global Express Guaranteed, or certified mail, with postage or shipping paid by the sender and with evidence of delivery, which may be in an electronic format. Fla. Stat. § 713.18

The terms “managing agent” or “business agent,” in Fla. Stat. § 713.18 require actual delivery to an officer, director, managing agent or business agent. Florida courts have held that these terms connote one who acts as a representative of the corporation and who officially speaks for it in its local business affairs as opposed to a mere employee. See Cont’l Home Parks, Inc. v. Golden Triangle Asphalt Paving Co., 291 So. 2d 49, 50 (Fla. 2nd DCA 1974). If service of notices by actual delivery or by mail cannot be accomplished, then posting on the site of the improvement is permitted. Fla. Stat. § 713.18.

The Plaintiff in an action to enforce a construction lien must allege service of notice in accordance with If a plaintiff fails to allege service of notice in accordance with Fla. Stat. § 713.18. The plaintiff is entitled to amend his or her complaint to allege valid service prior to dismissal of the complaint for failure to follow the statute. S & S Air Conditioning Co. v. Cantor, 313 So. 2d 422 (Fla. 3d DCA 1975).

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W Mason is an associate with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W focuses his practice on commercial litigation throughout Florida, with an emphasis on construction litigation. You can reach W at (561) 804-4432 or wmason@foxrothschild.com. Below are some recent posts W has written on Florida Construction Lien Law:

 

Generally, an owner or an owner’s agent is required to record a notice of commencement in the clerk’s office and post either a certified copy of the recorded notice of commencement or a notarized statement that the notice of commencement has been filed for recording along with a copy thereof. Fla. Stat. § 713.13(1)(a). The notice of commencement must contain the following information:

1.  A description sufficient for identification of the real property to be improved. The description should include the legal description of the property and also should include the street address and tax folio number of the property if available or, if there is no street address available, such additional information as will describe the physical location of the real property to be improved.

2.  A general description of the improvement.

3.  The name and address of the owner, the owner’s interest in the site of the improvement, and the name and address of the fee simple titleholder, if other than such owner. A lessee who contracts for the improvements is an owner as defined under s. 713.01(23) and must be listed as the owner together with a statement that the ownership interest is a leasehold interest.

4.  The name and address of the contractor.

5.  The name and address of the surety on the payment bond under s. 713.23, if any, and the amount of such bond.

6.  The name and address of any person making a loan for the construction of the improvements.

7.  The name and address within the state of a person other than himself or herself who may be designated by the owner as the person upon whom notices or other documents may be served under this part; and service upon the person so designated constitutes service upon the owner.

The Fourth District discussed the purpose of the Notice of Commencement in a 1999 decision. As the court explained:

Though the Notice of Commencement was originally required to trigger a commencement date from which to measure time limitations under the Mechanic’s Lien Law, the information contained in the Notice of Commencement provides all the details necessary to complete a Notice to Owner. Indeed, Section 713.13(1)(a), Florida Statutes, requires with Notice of Commencement information including the name and address of the owner and contractor. Thus, the legislature contemplated that the Notice of Commencement would provide the lienor with the current names and addresses of the owner and contractor, so that the lienor could properly mail the Notice to Owner. If no Notice of Commencement was ever posted or recorded by the owner as mandated by the statute, a lienor may have difficulty obtaining the names and addresses of the owners and contractor.

Sasso Air Conditioning, Inc., v. United Companies Lending Corporation, 742 So.2d 468, 470 (Fla. 4thDCA 1999), citing Symons Corp. v. Tartan-Lavers Delray Beach, Inc.456 So.2d 1254, 1259 (Fla. 4thDCA 1984). The Notice of Commencement signals the beginning of a construction project. Gulfside Properties Corp. v. Chapman Corp., 737 So.2d 604, 607 (1stDCA 1999). Under Fla. Stat. § 713.01(5), the “commencement of the improvement” is defined as “the time of filing for record of the notice of commencement provided in s. 713.13.” The key function of the Notice of Commencement is to provide the lienor and other third parties with the information they need to prepare necessary notices and related documents under Florida’s mechanic’s lien statutes. Gulfside Properties, 737 So.2d at 607.

 The failure by a property owner to file a Notice of Commencement does not relieve a contractor or supplier from satisfying the mechanic’s lien statute’s notice requirements. Professional Plastering & Stucco, Inc., v. Bridgeport-Strasberg Joint Venture, et al., 940 So.2d 444, 449 (Fla. 5th DCA 2006), citing Mursten Constr. Co. v. C.E.S. Indus., Inc., 588 So.2d 1061 (Fla. 3d DCA 1991). For instance, where a supplier failed to serve written notice of nonpayment on the contractor, the supplier’s failure to adhere to the requirements of the statute prevented its recovery under a construction bond despite the fact that the owner failed to file a notice of commencement. Murston, 588 So. 2d at 1062-63.

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W Mason is an associate with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W focuses his practice on commercial litigation throughout Florida, with an emphasis on construction litigation. You can reach W at (561) 804-4432 or wmason@foxrothschild.com. Below are some recent posts W has written on Florida Construction Lien Law:

 

Previously in this series, the Notice to Contractor condition precedent was discussed in the context of actions in connection with payment bonds. In addition to the Notice to Contractor, Section 713.23(1)(d) of Florida’s Construction Lien Law requires a lienor, as a condition precedent to recovery under a payment bond, to serve a written “Notice of Nonpayment” to the contractor and the surety not later than 90 days after the final furnishing of labor, services, or materials by the lienor. A written notice satisfies this condition precedent with respect to the payment described in the notice of nonpayment, including unpaid finance charges due under the lienor’s contract, and with respect to any other payments which become due to the lienor after the date of the notice of nonpayment. The time period for serving a written Notice of Nonpayment shall be measured from the last day of furnishing labor, services, or materials by the lienor and shall not be measured by other standards, such as the issuance of a certificate of occupancy or the issuance of a certificate of substantial completion.

The failure of a lienor to receive retainage sums not in excess of 10 percent is not considered a nonpayment requiring the service of the notice of nonpayment. If the payment bond is not recorded before commencement of construction, the time period for the lienor to serve a notice of nonpayment may at the option of the lienor be calculated from the date specified in this section or the date the lienor is served a copy of the bond. The notice may be in substantially the following form:

 NOTICE OF NONPAYMENT

(name of contractor and address) 

(name of surety and address) 

The undersigned notifies you that he or she has furnished   (describe labor, services, or materials)   for the improvement of the real property identified as   (property description)  . The amount now due and unpaid is $____ .

If a lienor fails to deliver a notice of nonpayment to the contractor and surety in accordance with the provisions of Fla. Stat. § 713.23(1)(d), no suit may be brought on the bond. See Standard Heating Service, Inc. v. Guymann Const., Inc., 459 So. 2d 1103 (Fla. 2d DCA 1984). As such, unless a lienor timely provides both a Notice to Contractor and Notice of Nonpayment, no action can be maintained against a contractor or surety. Fla. Stat. § 713.23(1)(e). Assuming compliance with the notice requirements, Fla. Stat. 713.23(1)(e) limits the time period for bringing an action on a bond to one year after the provision of labor, material, or supplies by the lienor.

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W Mason is an associate with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W focuses his practice on commercial litigation throughout Florida, with an emphasis on construction litigation. You can reach W at (561) 804-4432 or wmason@foxrothschild.com. Below are some recent posts W has written on Florida Construction Lien Law:

 

On May 21, 2014, Florida’s Second District Court of Appeals issued an opinion in Snell v. Mott’s Contracting Services, Inc. affecting construction claims of lien and arbitration proceedings. The court examined the question of whether the award of attorneys’ fees was proper in an arbitration proceeding pursuant to Florida’s Construction Lien Law.

The court held that Section Fla. Stat. § 713.21(1) requires that an “action to enforce a construction lien must be brought ‘in a court of competent jurisdiction’ within one year of recording the claim of lien or it automatically extinguishes.” Moreover, the Court held that an arbitration proceeding is not a “court.”  As such, the lien at issue in this case “became unenforceable pursuant to section 713.22 prior to the issuance of the [arbitration] award” due to the contractor’s failure to file an enforcement action in court within a year.

Given the holding in Snell, it is likely advisable for lien holders to file an action in a court of competent jurisdiction within a year, even if the action is stayed during an arbitration proceeding. Otherwise, lienholders may have difficulty recovering fees or even enforcing a lien to the extent that enforcement in the arbitration proceeding is not complete within year.

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W Mason is an associate with the law firm Fox Rothschild LLP. W practices in Fox Rothschild’s Litigation department in West Palm Beach, Florida. W focuses his practice on commercial litigation throughout Florida, with an emphasis on construction litigation. You can reach W at (561) 804-4432 or wmason@foxrothschild.com. Below are some recent posts W has written on Florida Construction Lien Law: