Miami residents are used to waiting in line when the situation calls for it. At the same time, it helps to do what one can to get to the front of line or avoid the line altogether.
When it comes to construction litigation, being at the back of the line can mean a company does not get paid for the work they performed on a project. Last week, this blog discussed the ability of a contractor, subcontractor or other entity to file a construction lien against the property where work was performed in the event these entities have not been paid for their work. Florida law has specific requirements that must be followed in order for a construction lien to be valid and enforceable.
Often times, multiple parties may file construction liens against the same property. Because the property is only worth so much, there may not be enough money to satisfy all the liens against the property, in the event foreclosure is sought. In order to resolve these competing claims, Florida law gives priority to certain liens over others.
One key factor under the law is the date the client was recorded. Certain liens are given priority based on the time the claim was recorded. The liens are given priority over a conveyance or encumbrance on the property that is not recorded at the time the lien was recorded. Those conveyances or encumbrances recorded before the lien was recorded take priority against the lien.
Ultimately, there are different kinds of liens and different factors that give priority. Miami businesses who have potential liens should be aware of these issues in order to best protect their interests and ensure payment for the work they performed.
Source: Florida Legislature, “Chapter 713: Liens, Generally,” accessed on Feb. 20, 2016