The Law and Your Business-Lost Rights under Claim of Lien
By Tony Zebouni, Lindell Farson & Zebouni
I thought that you might enjoy a break from the Covid 19 pandemic and read about Florida lien law for a change. If you believe that once you’ve filed a correct claim of lien in Florida, that your rights are protected so long as you file a foreclosure action within one year, you may want to read on. A recent case discusses and strictly applies the language in Ch.713,21(4), F.S. that should be important to you.
M&C-Buslam was the general contractor on a project owned by Nicover, LLC. Nicover and M&C-Buslam had an agreement by which M&C-Buslam was required to indemnify Nicover for any attorneys’ fees and costs incurred in litigation in connection with the subject property. M&C-Buslam hired subcontractor, Tech Electric, to perform electrical work on the project. After Tech Electric was properly terminated, it filed a lien against the project. After Tech Electric failed to take any action on the lien against Nicover’s project, M&C-Buslam filed a suit, that included a summons/order to show cause under section 713.21, Florida Statutes. The summons/order to show cause was served on Tech Electric on September 10, 2019.
Once the summons/order to show cause was served on Tech Electric, it had twenty days to either file an action to foreclose the lien or show cause why the lien should not be vacated or canceled. On September 24, 2019, it filed a “Verified Response to the Order to Show Cause.” The response clearly showed the reasons why the lien was valid. The response failed, however, to state a good cause as to why the action to foreclose had not yet been filed or why it required additional time to prosecute the lien. It is undisputed that Tech Electric did not file its foreclosure suit within the twenty-day statutory period.
The statutory provisions governing mechanic’s liens must be strictly complied with and construed. Section 713.21(4) provides the lienor with two options following the issuance of a summons/order to show cause. Within twenty days, the lienor must either (1) demonstrate good cause why the action has not yet been filed and the lien should not be discharged, or (2) file the foreclosure action.
Tech Electric failed to strictly comply with the requirements of section 713.21(4), as it neither filed suit nor showed good cause as to why the lien had not yet been prosecuted in the time prescribed by the statute.