[CLC-Discussion] HB 1247

Wed Mar 20 15:33:56 PDT 2019

It appears the consensus is
1) this is a bill in search of a problem, or
2) this is a bad bill, or
3) both of the above.

Jeffrey L Price
NPWC, PA
5216 SW 91st Dr., Gainesville FL
352-373-9031

On Mar 20, 2019, at 5:29 PM, Dan Vega <DVega at tevtlaw.com<mailto:DVega at tevtlaw.com>> wrote:

Folks, as it stands now, when a conditional bond is properly posted and the lienor’s contract has valid pay when paid language, the lienor is supposed to proceed as if the job is not bonded and perfect its lien  rights.

The issue w the change has nothing to do with surprise because the lienor is supposed to be perfecting its lien under a 713.245 scenario the same way as if the job was not bonded.

The problem and resulting prejudice is that there are diff notice requirements for 713.23 bonded jobs versus non bonded jobs.

For example, If a lienor does not have pay when paid language and is in privity with the gc, the conditional bond will not apply to him.  As it stands now, the bond is treated as a 713.23 bond.  Because the lienor is in privity w the gc on a bonded job, it does not need to serve a notice to contractor.

However, if now the conditional bond that was not posted does not convert into a 713.23 bond, then lien rights should apply.  This llenor would lose its lien rights due to not serving an nto.

There are countless other examples of problems.

Sent from my iPhone

Daniel R. Vega, Esq.
Florida Board Certified in Construction Law
Florida Supreme Court Certified Circuit Court Mediator
Taylor Espino Vega & Touron, PLLC
201 Alhambra Circle, Suite 801
Coral Gables, Florida 33134
Telephone: (305) 443-2043
Facsimile: (305) 443-2048
Cell: (305) 962-5186
E-mail: dvega at tevtlaw.com<mailto:dvega at tevtlaw.com>

On Mar 20, 2019, at 5:14 PM, Robert Worman <rworman at wormanlaw.com<mailto:rworman at wormanlaw.com>> wrote:

But Adam, the recorded NOC is supposed to be presented to the Building Dept. at the time of Permit issuance.  It should be incumbent upon the contractor to verify that the NOC has been properly recorded with the bond referenced and attached at the time of permitting.  Likewise, the owner would want the bond to be so noted in the NOC since to the extent of payments made, the owner’s property is shielded from the lien.  More importantly, this Amended Bill would force a lienor to be constantly having to search the Public Records to see if a 713.245 bond has been recorded since there is no mechanism to have the contractor notify lienors having given notice prior to the recording.

Regards,

Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman at wormanlaw.com<mailto:rworman at wormanlaw.com>
www.wormanlaw.com<http://www.wormanlaw.com/>

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From: clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org> <clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org>> On Behalf Of Adam C. Linkhorst
Sent: Wednesday, March 20, 2019 3:39 PM
To: Dan Vega <DVega at TEVTLaw.com<mailto:DVega at TEVTLaw.com>>; Jeffrey Price <jeff at npw-law.com<mailto:jeff at npw-law.com>>
Cc: clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>
Subject: Re: [CLC-Discussion] HB 1247

The problem with the comment below Dan’s is that it entirely misses the fact that the responsibility to prepare and record the NOC falls to the Owner or Lender, not the Contractor.  So the suggestion that the Contractor is somehow being sneaky is misleading.  Rather, the whole purpose of the suggested change is to avoid penalizing the Contractor for something the Owner/Lender does that is not within the Contractor’s control (i.e., preparing and recording the NOC and deciding what is attached to it and what is not).  Further, what makes the current situation even more problematic is the fact that the Owner/Lender (the parties preparing and recording the NOC) are incentivized to not record the NOC properly (by failing to reference or attach the bond).

Stated simply, the goal is to modify the statute so that the GC is not penalized for something that is not within the GC’s control, not to sneak something by anyone.

Adam C. Linkhorst, Esq.
Linkhorst & Hockin, P.A.
acl at FloridaHardhatLaw.com<mailto:acl at FloridaHardhatLaw.com>
Tel.   561.626.8880 / Cell.  954.562.9199
<image001.jpg>

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 Dan Vega
Sent: Wednesday, March 20, 2019 3:13 PM
To: Jeffrey Price <jeff at npw-law.com<mailto:jeff at npw-law.com>>
Cc: clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>
Subject: Re: [CLC-Discussion] HB 1247

At least the noc still requires that a surety be identified.

However I agree with you 100 percent.

In the end, someone needs to let the lawmakers know that a conditional bond will always be treated as a different bond to some lienors on a project.

The reason is simple:   the contractor can only control the inclusion of pay when paid language in its contract with its subs.  Subssubs and material supliers wil likely never have pay when paid language in their contracts and proposals.  And pay when paid language is a condition precedent to the existence of a 713.245 bond.
Sent from my iPhone

Daniel R. Vega, Esq.
Florida Board Certified in Construction Law
Florida Supreme Court Certified Circuit Court Mediator
Taylor Espino Vega & Touron, PLLC
201 Alhambra Circle, Suite 801
Coral Gables, Florida 33134
Telephone: (305) 443-2043
Facsimile: (305) 443-2048
Cell: (305) 962-5186
E-mail: dvega at tevtlaw.com<mailto:dvega at tevtlaw.com>

On Mar 20, 2019, at 3:02 PM, Jeffrey Price <jeff at npw-law.com<mailto:jeff at npw-law.com>> wrote:
UPDATE – 3/20/2:45PM
Changes were made yesterday – I have struck through the items that were cut by amendment
Now, the NNP is more in-keeping with what we already have – they are simply rearranging the deck chairs, so I have no issue here.

But I still have a big issue with the next part which was not addressed:

The new, sneaky way to file a Conditional Payment Bond:
The bill provides an additional way for a contractor to record a conditional bond. The bill also provides that failing to properly record a conditional payment bond does not preclude the bond from being a conditional payment bond. That’s a change
The bill provides that in lieu of listing the bond as a conditional payment bond on the NOC and recording the bond with the NOC, a contractor may record a notice identifying the bond as a conditional payment bond with the bond attached before the contractor begins work on the project in a separate filing.

I do not see why, if the payment bond is conditional upon payment by the Owner, that can’t be required to be stated upfront.
Why “in lieu of”? Not to save money, because that’s an extra filing fee and action. Not because you got the bond later, because it says you must file it before beginning work. So what is the reason if not to be a sneaky little shit (borrowing language from Animal House, remember Niedermeyer?).

Under this scheme, the Contractor has a conditional payment bond in place, refuses to record it with the NOC, (even though they have it), do a separate filing of just the bond, and now we have a secrete bond that comes out only when a claim is made. My guy may not have wanted to do the job I they knew the bond was conditional. But was he given any knowledge, any choice, or was the knowledge hidden (in plain sight buried in the public records)? If you want to buy a conditional bond, go buy one. That’s the market at work. But don’t hide that fact. It appears that the people pushing this idea know full well that a conditional bond sucks and they want to hide that fact. Come on, be proud of your conditional bond – bring it out of the closet!

Now we get to look in additional locations for information – that makes things easier – not.

For those of you trying to keep up, here is the original bill and changes made so far.
This bill ups the notice requirement for the NNP (additions in RED)

The name of the contractor and the contractor’s address;
The name of the surety and the surety’s address;
The nature of the labor or services performed;
The nature of labor or services to be performed, if known;
The materials furnished;
The materials to be furnished, if known;
The amount received by the lienor;
The amount due the lienor and the amount to become due, if known;
The lienor’s signature and address.

This stuff was in the above, but was cut – good:
Copies of the following documents if they exist;
The lienor’s contract or purchase order and any amendments thereto;
Invoices, pay requests, bills of lading, delivery receipts, or similar documents; and
A statement of account reflecting all payments requested and received for the labor, services, or materials.
Written verification of the notice of nonpayment in accordance with s. 92.525. (Pursuant to s. 92.525, a person who knowingly makes a false written declaration is guilty of a third degree felony);

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From: clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org> <clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org>> On Behalf Of Dan Vega
Sent: Tuesday, March 19, 2019 8:48 PM
To: Barry Kalmanson <bkpa1 at aol.com<mailto:bkpa1 at aol.com>>
Cc: clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>
Subject: Re: [CLC-Discussion] HB 1247

Thanks Barry.

I would like to participate on the call.

Working in Miami for the past 20 years, where a large portion of the subs speak mainly Spanish, the notice of non payment amendment will certainly make it more difficult for these companies to perfect their claims without the assistance of counsel.

On 713.245 amendment, what is the purpose of recording the notice identifying bond as conditional if nothing occurs if it is not recorded ?

And isnt 713.245 supposed to sunset at some point?  No owner with half a brain will purchase one of these bonds especially since as I understand it, they cost the same as a 713.23 bond.

Also, why would the legislature equate a notice of non payment to an encumbrance on real estate?

Finally, am I reading this amendment right so that if passed, 627.428 will apply to a payment bond claimant’s fee claim - net judgment instead of significant issues?

Thank you.

Sent from my iPhone

Daniel R. Vega, Esq.
Florida Board Certified in Construction Law
Florida Supreme Court Certified Circuit Court Mediator
Taylor Espino Vega & Touron, PLLC
201 Alhambra Circle, Suite 801
Coral Gables, Florida 33134
Telephone: (305) 443-2043
Facsimile: (305) 443-2048
Cell: (305) 962-5186
E-mail: dvega at tevtlaw.com<mailto:dvega at tevtlaw.com>

On Mar 19, 2019, at 7:11 PM, Barry Kalmanson <bkpa1 at aol.com<mailto:bkpa1 at aol.com>> wrote:
Today the Business and Professions Subcommittee of the Florida House amended House Bill 1247 with the attached. As you will note it will make it almost impossible for a claimant to recover on a payment bond in Florida.

It also permits contractors after the notice of commencement is recorded to record an unspecified  notice that a bond is conditional without serving it on any claimant. Claimants will have NO  notice of the recorded document and not know how to properly proceed.

Additionally it creates new causes of action creating substantial unnecessary litigation.

We should immediately hold a conference call to vote on the proposed bill and have our lobbyist act on our behalf.

Sincerely,

Barry Kalmanson
500 N Maitland Avenue
Suite 305
Maitland, Fl. 32751
407-645-4500 x 215

www.barrykalmanson.com<https://nam05.safelinks.protection.outlook.com/?url=http%3A%2F%2Fwww.barrykalmanson.com&data=02%7C01%7Crworman%40wormanlaw.com%7C5f594add079d45c232d808d6ad6d848d%7C68fc084f55084277b842e0ec34a978fa%7C0%7C0%7C636887083238742682&sdata=FAZ7xeCtDVkXP6mtNYMq5oDMh0Ad69ruVQr5pr9YZ7Q%3D&reserved=0>

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Deborah E. Lawson
(850) 570-0033
Sent from my iPhone
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