Florida’s construction market remains hot, but the surge in activity has brought with it an increase in disputes and litigation. One particularly active area involves mechanics liens and professional liability claims arising from noncompliance with the revised statutory framework under Chapter 713, Fla. Stat. While most professional liability policies do not cover mechanics’ lien claims because they are statutory in nature, there are important practical overlaps that could give rise to a covered claim or defense obligation. The key is that the malpractice claim does not arise from the lien itself, but from how the lien was handled, advised on, or filed, resulting in damages to a third party.

Changes to Florida Lien Laws Effective October 1, 2023

         Effective October 1, 2023, Florida enacted sweeping changes to its lien laws. These changes expand lien rights, impose stricter compliance requirements, and create new avenues for defending against lien claims. Importantly, Florida courts enforce lien rights through strict statutory compliance, and excusable neglect or equitable arguments will not save a noncompliant lien. The major updates to Florida’s lien laws are as follows:

1. The definition of “Contractor” is broadened to include architects, landscape architects, and engineers. This definition also includes surveyors.  

2. The threshold for notice of commencement of filings was raised from $2,500 to $5,000 for building permit projects, (excluding repairs for AC systems of less than $15,000). 

3. Notice of nonpayment rules have been expanded, such that lien claimants must now notify both the contractor and its surety when filing nonpayment claim under payment bonds. 

4. Tighter lien satisfaction/release rules requiring releases to include lienor’s  notarized signature and recording details, or otherwise risk releases being unenforceable.

5. Bond amounts increased when a lien is transferred to bond security to includes three (3) years of interest plus the higher of $5,000 or 25% of the lien.

6. Prevailing party attorneys’ fees now explicitly allowed in lien enforcement cases  and in arbitrations related to payment of bonds. 

       There has also been a concerted effort to protect owners from unjustified liens, as seen in the clarification of the requirements for enforcement of liens. In our experience litigation of liens often focuses on strict compliance with deadlines and service requirements, which now include:

1.  Strict filing deadlines have been clarified to reflect that if a filing deadline falls on weekends, holidays or during clerk’s office closures, the deadline extends to the next business day. 

2. Multiple service methods are now permitted allowing hand-delivery, mail via certified methods, or posted on site notifications. 

3. The deadline for a contractor to file a lien has been reduced from 12 months to 60 days, otherwise the lien is extinguished.

4. Owners may now post a bond to clear title and shift disputes to the courts. 

Architects and Engineers: 

        Architects and Engineers seeking to assert a lien against a client’s project to pursue collection of outstanding fees are now covered by Florida’s new lien laws. The statute is clear that such rights only arise from the furnishing of “proper services,” defined as professional services directly related to the physical improvement of the property. Work such as pre-design feasibility studies, conceptual sketches, or preliminary evaluations does not qualify and cannot support a valid lien claim. Moreover, if the professional’s services never result in permitted construction, for example, when a developer abandons a project before breaking ground, lien rights may be severely limited or altogether nonexistent.

       Equally important is the requirement that an architect or engineer maintain a written contract with the property owner or contractor. Oral agreements, even if relied upon by both parties, do not create enforceable lien rights under Florida Law. Strict compliance with deadlines is also essential. A claim of lien must be recorded within 90 days of when services were last furnished. However, as with contractor liens, that time frame can be cut dramatically: once an owner files a Notice of Contest of Lien, the lienholder has only 60 days to file suit or risk having the lien discharged.

       Regarding attorney malpractice claims, the areas we see claims arise related to failure to meet statutory deadlines, improper notices, misadvising clients about lien procedures, documentation and enforceability as well as failure to defend against invalid liens resulting in damages to the owner. 

Lien Claim Scenarios from Actual Cases: 

        Our firm has seen an increase in all professional liability claims arising from non-compliance with the new requirements governing lien claims.  This includes claims against design professionals arising from fraudulent/erroneous liens for nonpayment of services as well as malpractice lawsuits against lawyers for failure to present defenses to lien validity issues before judgment, and not after a motion to vacate. Some other professional liability issues about which to be aware include:

1. Dismissing liens which appear to be fraudulent and engage in procedural due to avoid reopening a case to enforce prevailing party fees.

2. Parties threatening to file a lien but denied because liens have not been filed within the 60-day deadline.  

3. Work by unlicensed contractors, which is on the rise in Florida. Unlicensed contractors simply cannot assert a lien on a residence, yet we are seeing an increase in these actions which can give rise to felony criminal charges. 

4. Professional services by interior designers acting as an owner’s representative and overseeing renovations and a subsequent assertion that the interior designer did not perform necessary contractor duties to have lien rights. 

5. Final payment being withheld by owners over disputes concerning workmanship by contractors. 

6. Homeowners’ express confusion about encountering liens after paying general contractors due to subcontractors not being paid, which still encumber the property – i.e., “I never knew that subcontractor even worked on my house.”

7. Dismissing liens that appear to be fraudulent and engaging in procedural due care to avoid reopening a case to enforce prevailing party fees. 

8. Parties threatening to file a lien are precluded because the lien was not filed within the 60-day deadline.  

       Given these developments, the practical impacts of the October 2023 lien law changes are significant. Owners must now recognize that lien exposure extends beyond builders and contractors to include design professionals as well. Architects and engineers, in particular, must take greater care to structure their contracts in writing and to carefully document the dates on which services are performed in order to preserve their lien rights. At the same time, the revised statute imposes heightened responsibility on all parties to strictly comply with the clarified notice and deadline requirements, as courts are unlikely to excuse even minor deviations.

       As always, if you would like further information on the above topic, or a presentation on this and other topics, Shendell & Pollock would be pleased to do so for your group. For more about the firm, please visit www.shendellpollock.com.

       Shendell & Pollock is a full-service litigation and business law firm providing a comprehensive range of services to a wide variety of clients, including public traded companies, privately owned businesses, banks and insurance companies, financial institutions, private lenders & more.

                On March 9, 2024, Brett R. Bloch and Joshua Battat obtained a defense verdict after a four day trial on behalf of the Perkins restaurant in Melbourne, Florida. On October 13, 2017, Cheryl Marbry, represented by Morgan & Morgan, was entering the restaurant when she slipped and fell in the entry foyer area. According to the Plaintiff, she took only one step and then slipped, striking her body on the floor and her head on an interior door threshold. Her injuries included multiple cervical herniated discs which required a five level fusion and spinal cord stimulator, a torn rotator cuff, a fractured radius as well as a traumatic brain injury. Her past medical costs were $643,155.04.
 
               Without any warning, on the second day of trial, the Plaintiff’s counsel advised the court that the Plaintiff was unfit to testify due to her cognitive problems caused by her traumatic brain injury. On the third day of trial, after conducting an in camera examination of the Plaintiff, the court declared that the Plaintiff was mentally incompetent to testify at trial, thereby leaving the parties with no alternative other than to present the Plaintiff’s deposition testimony to the jury. 
 
                Although the Plaintiff contended that the restaurant failed to timely and properly inspect the foyer area and ensure that it was free of any hazards, in particular water which had accumulated on the foyer floor, the defense asserted that the Plaintiff failed to use due care when walking as she admitted that she was aware that it had rained earlier that day. Additionally, the defense stressed that  the restaurant utilized indoor and outdoor mats, a wet floor warning sign and that non-skid tiles were used on the foyer floor. Further, the defendant’s manager  and owner testified that the restaurant employed proper protocols, which included formal and informal inspections throughout its hours of operation. In his closing arguments, the Plaintiff’s counsel advised the jury that his client was seeking damages of her past medical charges, her future medical charges of $866,491.38 as well as past and future pain and suffering damages of $40,000,000.00. After three hours of deliberation, the jury rendered a defense verdict. A January 2021 Proposal for Settlement was rejected by the Plaintiff.
 
                Cheryl Marbry v. Loompy, LC d/b/a Perkins Restaurant, case no. 05-2019-CA-039333 filed in the Circuit Court of the Eighteenth Judicial Circuit in and for Brevard County, Florida. Hon. Curt Jacobus presiding.

Shendell & Pollock, P.L. is proud to announce the addition of three associate attorneys, Joe Greco, Chris Badiavas, and Janillah Joseph to bolster its talented group of casualty, construction and professional liability attorneys. 

“We are fortunate to have great clients who entrust us with their work and are dedicated to offering a group of talented lawyers in our practice areas,” said Gary Shendell, managing partner of Shendell & Pollock, P.L. “We have spent considerable time getting to know Joe, Chris and Janillah and could not be more pleased with the quality of their legal work, dedication to their craft and professionalism all of which serves to add quality bench strength and capacity to our firm.”  

Joe S. Greco is a graduate of Florida Atlantic University, where he obtained his bachelor’s degree in psychology in 2014. In 2019, Mr. Greco earned his Juris Doctorate from Suffolk University Law School in Boston, MA. During his time at Suffolk, Mr. Greco earned the Distinguished Oral Advocacy Award and focused on Municipal Law, Local & State Government, and Land Use. While in law school, he worked with the City of Somerville and the 15^th Judicial Circuit’s State Attorney’s Office...

Chris Badiavas is a member of the Firm’s Construction and General Liability Practice Groups where he focuses upon representing and defending clients in construction defect claims, injuries caused on construction sites, and local and national clients involving premises and retail liability, automobile liability and general liability. Chris also handles the defense of community association board members and commercial property owners in a wide variety of disputes.  Prior to joining Shendell & Pollock, P.L. Chris served as a member of an in-house counsel team for the largest insurer of residential properties in Florida....Click to Read More! 

Janillah A. Joseph is a 2009 graduate of the University of Central Florida where she received her B.A. in Legal Studies. Janillah received her Juris Doctorate from Nova Southeastern University Shepard Broad School of Law, where she was the Treasurer of the Business Law Students Association...Click to Read More!

Richard Kilstein, Esq.  is Of-counsel to the Firm for over fifteen (15) years and co-leads the Firm’s New Jersey practice with Gary R. Shendell. Richard concentrates his practice on professional liability defense of the full gamut of professionals including, but not limited to, real estate agents, estate planning ….Click to Read More!

“I have worked extensively with the attorneys of the firm for years over the course of my career and have long admired the culture instilled by the partners at Shendell & Pollock, P.L., and could not be happier to reconnect with my firm colleagues. I look forward to working closely with everyone and supporting our clients’ business goals and legal needs.” – Richard Kilstein 

Shendell & Pollock, P.L. is excited to start 2025 with these new associates! Each of these attorneys has excelled in the practice of law through hard work and dedication to client needs. Each have demonstrated technical skills and a practical approach. 

Florida recently enacted HB 837 into law, which greatly modified existing law applicable to injury and wrongful death actions as well as insurance bad faith lawsuits.

It is important to recognize that there are now significant changes which greatly
impact a plaintiff’s claim, including:

•  A reduction of the Statute of Limitations time period to file negligence actions from four years down to two years from the date of the incident. Previously, the two-year time period was only applicable to professional malpractice actions. Please note that this modification only applies to acts which occur after this law was enacted.

• A return to the contributory negligence standard in which any claimant (other than medical malpractice claimants) found to be responsible for more than fifty percent of their damages will not be able to recover damages from a third party. This is a radical departure from the previous “pure comparative” standard which did not a percentage limitation.

• The use of only evidence as to the amount actually paid by or on behalf of a plaintiff in determining the accurate value of medical damages for past or future medical care in personal injury or wrongful death actions. Previously there was a division between the courts in Florida regarding the admissibility of the total medical charges vs. the amount for which the plaintiff was responsible at the time of trial.

• The disclosure of letters of protection regarding medical expenses as a condition precedent to assert a claim for medical expenses in personal injury and wrongful death cases. A plaintiff will now be required to disclose the letter of protection, the identity of the individual who made the referral (including an attorney) and whether any medical insurance coverage was applied.

• The requirement that a jury consider the fault of all persons who may have contributed to the injury, establishes a presumption against negligent security liability in certain specified situations, and further expands immunity for a property owner in an injury action brought by a person who was the victim of a crime when lawfully on the property.

• The presumption in favor owners of multifamily residential property which substantially implement certain security measures in actions involving criminal acts which occur on the premises.

• The repeal of the attorney fee provisions for insurance cases, which previously awarded incurred attorney’s fees and costs to individuals (but not insurance companies) who prevailed in coverage actions. 

The statutory changes also provide much needed benefit to insurance companies as:

• The bad faith standard is now raised as clarify that the insurers’ negligence in handling a claim standing alone is not enough to demonstrate bad faith. The Florida courts had been moving in this direction since the Florida Supreme Court’s decision in Harvey v. GEICO in 2018.

• The requirement that a policyholder or claimant (as well as their representatives) must act in good faith as to providing information, asserting demands, establishing deadlines, and negotiating the resolution of the claim, thereby significantly reducing the likelihood of the “set up” previously utilized by many plaintiff’s attorneys.

• The ability of an insurance company to avoid bad faith liability to a third party if the insurer tenders its policy limits or the demand amount within 90 days after receiving first notice of the claim, including actions involving multiple claimants.   Previously, these issues were considered inherently factual which precluded resolution on summary judgment.

• The limitation of the use of a contingency fee multiplier of an attorney fee award in only very limited circumstances, which is consistent with the methodology utilized by federal courts.

Please note that the changes regarding insurance policies will only apply to those policies issued going forward and will not impact the rights and obligations under prior policies.The other provisions, however, are effective for actions filed after the effective date of this law.

As you can see, these changes will clearly benefit business owners and insurance companies in lawsuits in which they are named as defendants. By contrast, plaintiffs (as well as their counsel) will now be forced to provide increased and more specific information during the litigation process. This factor, in particular for those defendants who are also at fault, will likely reduce both the number of lawsuits as well as their duration going forward.

As always, if you would like further information on the above topic, or a presentation on this and other topics, Shendell & Pollock would be pleased to do so for your group. For more about the firm, please visit http://www.shendellpollock.com. Shendell & Pollock is a full-service litigation and business law firm providing a comprehensive range of services to a wide variety of clients, including public traded companies, privately owned businesses, banks and insurance companies, financial institutions, private lenders & more.