[CLC-Discussion] 13.24 Third Party Claimants Under Bond?

Wed Aug 28 15:52:11 PDT 2013

Does anyone have the cite to the recent case that held a Q. A. cannot be held individually liable for defective work by the Corporate CGC, following Murthy v. N. Sinha. Thanks, Lep

From: clc-discussion-bounces at lists.flabarrpptl.org [mailto:clc-discussion-bounces at lists.flabarrpptl.org] On Behalf Of Gibbons, Michael
Sent: Monday, August 12, 2013 1:53 PM
To: 'Steve Thompson'; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] 13.24 Third Party Claimants Under Bond?

You raise a good point Steve.  I was addressing my comment to the Court's language that  appears to have [mis]construed 713.24 to permit lower tiered subs and suppliers, in the ordinary course,  to assert a claim on a lien transfer bond posted in favor of an entity higher in the food chain.     I'll let the surety mavens comment on the merits of your chose in action argument (which, without researching it, appears compelling).

Michael R. Gibbons  (Bio<http://lowndes-law.com/our-people/michael-r-gibbons>)
Shareholder
Lowndes, Drosdick, Doster, Kantor & Reed, P.A.
215 N. Eola Drive
Orlando, FL 32801
Phone: 407-418-6378
Fax: 407-843-4444
email: michael.gibbons at lowndes-law.com<mailto:michael.gibbons at lowndes-law.com>
website: http://www.lowndes-law.com<http://www.lowndes-law.com/>

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From: Steve Thompson [mailto:sthompson at thompsonbrookslaw.com]
Sent: Monday, August 12, 2013 1:38 PM
To: Gibbons, Michael; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: RE: [CLC-Discussion] 13.24 Third Party Claimants Under Bond?

Michael:

    I don't think it is that simple.   As you point out the lien transfer bond is a contract running in favor of a specified lienor.  That lienor has a statutory chose in action against the surety, assuming it has properly complied with the prerequisites of ch 713 (i.e. has a valid lien).  That chose in action can be voluntarily assigned to a third party creditor, or taken by a third party creditor involuntarily through a valid legal proceeding.  Choses in action are typically taken involuntarily through proceedings supplementary under Fla. Stat. ch 56, rather than garnishment proceedings, however, to the extent that such an action is deemed a "debt" by the court, then it could be taken by a garnishment proceeding.  Regardless of how acquired, a valid argument exists that the third party creditor stands in the shoes of the lienor who originally owned the chose in action and is capable of asserting the claim in the name of that original lienor.  As a result, standing is not an impediment nor, in my opinion, must such a creditor have a valid claim of lien in its own right to exercise such a remedy.  Of course this comes from the prospective of someone who frequently represents third tier material suppliers, so it could be wishful thinking!

Steven F. Thompson, Esq.
Thompson & Brooks
412 E. Madison St., Ste 900
Tampa, Fl. 33602
813-387-1821
Fax 813-387-1824
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From: clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org> [mailto:clc-discussion-bounces at lists.flabarrpptl.org] On Behalf Of Gibbons, Michael
Sent: Monday, August 12, 2013 10:52 AM
To: 'Roberts, Hardy L.'; CLC Discussion (clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>)
Subject: Re: [CLC-Discussion] 13.24 Third Party Claimants Under Bond?

  While the language is unfortunate, I don't think it will have much impact in practice for two reasons.  First, the Lien Transfer Bond is a contract running in favor of a specified lienor whose lien has been transferred to the security of the bond.  Other persons simply don't have standing to sue the Surety on the lien transfer bond.  Besides the standing issue,  in order for lower tiered materialman or sub-subcontractor to have a claim on any lien transfer bond, that materialman or sub-subcontractor must be able to establish that it has a valid and enforceable claim of lien.  And if it has a perfected claim of lien, then it will either be foreclosing on the real property or have its very own lien transfer bond as substituted security (with no need to piggyback on some other lienor's lien transfer bond).

Michael R. Gibbons  (Bio<http://lowndes-law.com/our-people/michael-r-gibbons>)
Shareholder
Lowndes, Drosdick, Doster, Kantor & Reed, P.A.
215 N. Eola Drive
Orlando, FL 32801
Phone: 407-418-6378
Fax: 407-843-4444
email: michael.gibbons at lowndes-law.com<mailto:michael.gibbons at lowndes-law.com>
website: http://www.lowndes-law.com<http://www.lowndes-law.com/>

        [cid:image001.jpg at 01CEA41F.A38DBE40]

From: clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org> [mailto:clc-discussion-bounces at lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Saturday, August 10, 2013 2:10 PM
To: CLC Discussion (clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>)
Subject: [CLC-Discussion] FW: 13.24 Third Party Claimants Under Bond?

Please see the request below from Robert Worman...

From: Robert B. Worman [mailto:rbworman at wormanlaw.com]
Sent: Friday, August 09, 2013 10:54 AM
To: Roberts, Hardy L.
Subject: 13.24 Third Party Claimants Under Bond?

Hardy,

Can you circulate this through ListServe for the Construction Law Committee to address?

Please review the attached case which just came out.  I would appreciate comments on the dicta at the end of the 2d paragraph as to the theory under which materialman to a lienor would have a claim under the transfer bond.

Anyone want to crawl out on that limb?

Regards,

Robert B. Worman, Esq.
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, Florida (32789)
P.O. Box 1764
Orlando, Florida  32802
Phone:  (407)  843-5353
Fax:      (407)  841-9516
e-mail:  rworman at wormanlaw.com<mailto:rworman at wormanlaw.com>

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