[RPPTL-constructionlaw] Lien Law Legislative Proposal

Mon Jul 11 11:38:26 PDT 2011

  We are in agreement that the various SOL provisions are in conflict
and need some "tightening up".  I disagree with the proposed manner of
eliminating the existing inconsistencies.  The fatal flaw in the
proposed language is abandoning the existing reference to "principal on
the bond" and replacing it with the ambiguous "bond governed by the
applicable provisions of Fla. Stat. s. 255.05 and 713.23".  This
language replaces certainty with uncertainty and represents a "fix" we
don't need.

   I would concede that certainty and predictibility, while important,
are not the only polestars for good legislation.  I would also agree
that GC's and their sureties should not benefit when they fail to list
surety information on a NOC or fail to record Payment Bond in public
records on public projects.  Those limited circumstances can be
adequately addressed by adding tolling language that tolls the running
of the one year period until the bonds are recorded in the public
records or a corrected NOC is recorded listing the omitted surety and
attaching the payment bond.  A longer SOL for unrecorded subcontractor
payment bonds may also be appropriate.

  What we don't need is the proposed ambiguous language that invites
attorneys to litigate hypertechnical issues of whether the bond in
question is "governed by" 255.05 or 713.23.  Use the existing reference
to "bonds on which the principal is a contractor ... for private work as
well as public work".   If it ain't broke don't "fix" it.

Michael R. Gibbons  (Bio
<http://lowndes-law.com/our-people/michael-r-gibbons> )
Shareholder
Lowndes, Drosdick, Doster, Kantor & Reed, P.A.
450 South Orange Avenue, 8th Floor
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/> 

________________________________

From: constructionlaw-bounces at lists.flabarrpptl.org
[mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of Dan
Vega
Sent: Monday, July 11, 2011 1:46 PM
To: RPPTL constructionlaw
Subject: Re: [RPPTL-constructionlaw] Lien Law Legislative Proposal

Michael, your concern about the change to 95.11 misses the mark.  

First and most importantly, there is an initial obvious conflict in the
statutes in question that needs to be resolved as to when the SOL on a
payment bond claim starts to run.  That's priority.  

Second, there is no need for a one year SOL on claims against bonds that
are not required or provided for by statute such as 255.05, 337.18 or
713.23 bonds.  The reasons are as follows:  (1) those statutory bonds
are simply that - statutory creatures to be strictly construed as they
derogate the common law by providing a statutory claim/basis to get paid
for something otherwise protected by contract law; and (2) the statutory
bonds are required to be identified and attached to the Notice of
Commencement and recorded in the public records placing the
beneficiaries of those bonds on "notice" that they exist, hence the
short SOL.

A bond issued on behalf of a subcontractor is simply a contract.  It is
not provided for or required by any statute and does not need to be
recorded.  As such, it should be subject to the standard 5 year SOL
applicable to claims on written contracts, especially since those bonds
are not recorded nor identified in the NOC.  

Finally, the common law v. statutory bond dichotomy is for the most part
extinct.  Additionally, from my experience the argument generally
centered on the position that a GC statutory bond was rendered a common
law bond because it was not recorded or identified and/or attached to
the NOC.  Those are legitimate concerns as they impact the time
requirements for serving a Notice to Contractor and/or a Notice of
Non-payment as well as the time to file suit.  However, those concerns
are not applicable to subcontractor bonds.  And for the most part, the
common law bond concerns were cured by different amendments to 255.05
and 713.23 and 713.13.  

In sum, I see no harm in making sure that we are all on the same page as
it pertains to when the SOL starts to run on GC bond claims and that
those claims against bonds not required by statute be subject to the
same SOL applicable to any other contract.

Thank you.  

Daniel R. Vega

Board Certified in Construction Law

Vezina, Lawrence & Piscitelli, P.A.

121 Alhambra Plaza, Suite 1604

Coral Gables, Florida 33134

Main (305) 443-2043

Fax (305) 443-2048

Cell (305) 962-5186

dvega at vlplaw.com

************************************************
The information contained in this e-mail message is intended only for
the personal and confidential use of the recipient(s) named above.
This message may be an attorney-client communication and as such is
privileged and confidential. If the reader of this message is not the
intended recipient or an agent responsible for delivering it to the
intended recipient, you are hereby notified that you have received this
document in error and that any review, dissemination, distribution, or
copying of this message is strictly prohibited.  If you have received
this communication in error, please notify us immediately by e-mail, and
delete the original message.
************************************************

From: constructionlaw-bounces at lists.flabarrpptl.org
[mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of
Gibbons, Michael
Sent: Monday, July 11, 2011 1:01 PM
To: RPPTL constructionlaw
Subject: Re: [RPPTL-constructionlaw] Lien Law Legislative Proposal

    I could not make the call today but write to express my views on the
proposed legislative changes.  The proposed changes to Ch. 85 (dealing
with Owner's exposure to personal judgments on claims brought by
non-privity claimants) and Ch. 95 (dropping the one year SOL for all
bonds) are problematic for following reasons:

    1.  Fla. Stat. s. 85.021---    This unintelligible legislation
admittedly cries out to be rewritten.  Issue is making the Owner liable
personally to non-privity lienors foreclosing their construction liens.
I realize that there is a 1917 case and a 1969 case that arguably
supports holding an Owner personally liable for claims of non-privity
lienors.  As construction law is practiced today, however, at least in
my universe, the Owner is only personally liable to lienor claimants who
enjoy a direct contractual relationship with owner.  So, for example,
when a subcontractor lien is bonded off by a GC pursuant to Fla. Stat.
s. 713.24, the Owner is no longer a proper party to the action.  Owners
should not bear personal liability for construction debts owed to
subcontractors.  I believe having an in rem remedy along with a
contractual remedy against the contracting party (other than Owner) is
adequate for the protection of lower tier subs and suppliers.  I would
recommend that the statute be clarified, consistent with practice today,
that the Owner not be subject to personal liability when a non-privity
lienor is foreclosing its lien.  Owner, under certain circumstances,
should continue to be liable to non-privity claimants for unjust
enrichment.

    2.  Fla. Stat. s. 95.11 (2) (b) and (e)--   While there is an
inconsistency among the SOL's as noted, the prescribed "cure"  will
prove far more harmful than the existing shortcoming (which boils down
to measuring the one year SOL period from the date of sub's last date of
furnishing vs. GC's last date of furnishing).  The proposed change will
lead us right back to the bad old days when bond claims were dominated
by arguments about whether the bond was a "statutory bond" or a "common
law bond".  The provision sought to be deleted at s. 95.11 (2) (e) was
actually passed to eliminate all the uncertainty and expense associated
with litigating that issue which generated great confusion in the trial
courts.   The beauty of the existing language is that it doesn't matter
whether the bond is "statutory" or "common law"-- the one year period
applies.  Now we are going to replace that clarity with the ambiguous
proposed language which introduces the same fog that generated the years
of unproductive and wasteful litigation on common law vs. statutory
bonds.  If you want to make the SOL's all consistent, it is easy to do
without injecting all the uncertainty and ambiguity the proposed
legislation offers.  

Michael R. Gibbons  (Bio
<http://lowndes-law.com/our-people/michael-r-gibbons> )
Shareholder
Lowndes, Drosdick, Doster, Kantor & Reed, P.A.
450 South Orange Avenue, 8th Floor
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/> 

________________________________

From: constructionlaw-bounces at lists.flabarrpptl.org
[mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of
Reese J. Henderson, Jr.
Sent: Monday, July 11, 2011 11:24 AM
To: constructionlaw at lists.flabarrpptl.org
Subject: [RPPTL-constructionlaw] Lien Law Legislative Proposal
Importance: High

Folks,

In connection with today's call, please find attached the legislative
committee's proposal for which we are seeking approval to forward to the
Executive Council for further action and, hopefully, submission during
the 2012 legislative session.  Attached are:

1.       Legislative Position Request Form

2.       Proposal

3.       White Paper

The long and short is that we are seeking to clarify certain provisions
of the lien law to eliminate contradictory references, clarify the
statute of limitations on actions on payment bonds, tweak the statutory
claim of lien form; tweak the statutory notice of commencement form and
clean up the section dealing with electronic proof of delivery.  I will
be on the call to answer any questions.

Thanks,

Reese

Reese J. Henderson, Jr.

Board Certified Construction Attorney 

707 Peninsular Place
Jacksonville, Florida 32204

Phone (904) 354-5200
Facsimile (904) 354-5256
Reese.Henderson at atritt.com <mailto:%5Be-mail%5D> 
www.tritthenderson.com <http://www.tritthenderson.com/> 

CONFIDENTIALITY NOTICE: The information and all attachments contained in
this electronic communication are legally privileged and confidential
information, subject to the attorney-client privilege and intended only
for the use of intended recipients. If the reader of this message is not
an intended recipient, you are hereby notified that any review, use,
dissemination, distribution or copying of this communication is strictly
prohibited. If you have received this communication in error, please
notify us immediately of the error by return email and please
permanently remove any copies of this message from your system and do
not retain any copies, whether in electronic or physical form or
otherwise. Unauthorized interception of this e-mail is a violation of
federal criminal law.

TAX ADVICE DISCLOSURE: Pursuant to the requirements of Internal Revenue
Service Circular 230, we advise you that any federal tax advice
contained in this communication (including any attachments) is not
intended or written to be used, and cannot be used, for the purpose of:
(1) avoiding penalties that maybe imposed under the Internal Revenue
Code or (2) promoting, marketing or recommending to another party any
transaction or matter addressed in this communication.

Disclaimer regarding Uniform Electronic Transactions Act ("UETA")
(Florida Statutes Section 668.50): If this communication concerns
negotiation of a contract or agreement, UETA does not apply to this
communication; contract formation in this matter shall occur only with
manually-affixed original signatures on original documents.

________________________________

  <http://www.lowndes-law.com/> 

Notice of Confidentiality:  This e-mail communication and the
attachment(s) hereto, if any, are intended solely for the information
and use of the addressee(s) identified above and may contain information
which is legally privileged from disclosure and/or otherwise
confidential. If a recipient of this e-mail communication is not an
addressee (or an authorized representative of an addressee), such
recipient is hereby advised that any review, disclosure, reproduction,
re-transmission or other dissemination or use of this e-mail
communication (or any information contained herein) is strictly
prohibited. If you are not an addressee and have received this e-mail
communication in error, please advise the sender of that circumstance
either by reply e-mail or by telephone at (800) 356-6818, immediately
delete this e-mail communication from any computer and destroy all
physical copies of same. 

Replies Filtered:  Any incoming reply to this e-mail communication or
other e-mail communication to us will be electronically filtered for
"spam" and/or "viruses." That filtering process may result in such reply
or other e-mail communications to us being quarantined (i.e.,
potentially not received at our site at all) and/or delayed in reaching
us. For that reason, we cannot guarantee that we will receive your reply
or other e-mail communications to us and/or that we will receive the
same in a timely manner. Accordingly, you should consider sending
communications to us which are particularly important or time-sensitive
by means other than e-mail. 

Notice Under U.S. Treasury Department Circular 230:  To the extent that
this e-mail communication and the attachment(s) hereto, if any, may
contain written advice concerning or relating to a Federal (U.S.) tax
issue, United States Treasury Department Regulations (Circular 230)
require that we (and we do hereby) advise and disclose to you that,
unless we expressly state otherwise in writing, such tax advice is not
written or intended to be used, and cannot be used by you (the
addressee), or other person(s), for purposes of (1) avoiding penalties
imposed under the United States Internal Revenue Code or (2) promoting,
marketing or recommending to any other person(s) the (or any of the)
transaction(s) or matter(s) addressed, discussed or referenced herein.
Each taxpayer should seek advice from an independent tax advisor with
respect to any Federal tax issue(s), transaction(s) or matter(s)
addressed, discussed or referenced herein based upon his, her or its
particular circumstances.

[v4.30]

Notice of Confidentiality: This e-mail communication and the
attachment(s) hereto, if any, are intended solely for the information
and use of the addressee(s) identified above and may contain information
which is legally privileged from disclosure and/or otherwise
confidential. If a recipient of this e-mail communication is not an
addressee (or an authorized representative of an addressee), such
recipient is hereby advised that any review, disclosure, reproduction,
re-transmission or other dissemination or use of this e-mail
communication (or any information contained herein) is strictly
prohibited. If you are not an addressee and have received this e-mail
communication in error, please advise the sender of that circumstance
either by reply e-mail or by telephone at (800) 356-6818, immediately
delete this e-mail communication from any computer and destroy all
physical copies of same. 

Replies Filtered: Any incoming reply to this e-mail communication or
other e-mail communication to us will be electronically filtered for
"spam" and/or "viruses." That filtering process may result in such reply
or other e-mail communications to us being quarantined (i.e.,
potentially not received at our site at all) and/or delayed in reaching
us. For that reason, we cannot guarantee that we will receive your reply
or other e-mail communications to us and/or that we will receive the
same in a timely manner. Accordingly, you should consider sending
communications to us which are particularly important or time-sensitive
by means other than e-mail. 

Notice Under U.S. Treasury Department Circular 230: To the extent that
this e-mail communication and the attachment(s) hereto, if any, may
contain written advice concerning or relating to a Federal (U.S.) tax
issue, United States Treasury Department Regulations (Circular 230)
require that we (and we do hereby) advise and disclose to you that,
unless we expressly state otherwise in writing, such tax advice is not
written or intended to be used, and cannot be used by you (the
addressee), or other person(s), for purposes of (1) avoiding penalties
imposed under the United States Internal Revenue Code or (2) promoting,
marketing or recommending to any other person(s) the (or any of the)
transaction(s) or matter(s) addressed, discussed or referenced herein.
Each taxpayer should seek advice from an independent tax advisor with
respect to any Federal tax issue(s), transaction(s) or matter(s)
addressed, discussed or referenced herein based upon his, her or its
particular circumstances. [v4.30] 

This email message has been delivered safely and archived online by Mimecast.  For more information please visit http://www.mimecast.com
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://mailman.fsr.com/pipermail/constructionlaw/attachments/20110711/fe6fa63b/attachment.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: LEED_GArgb.jpg
Type: image/jpeg
Size: 16088 bytes
Desc: LEED_GArgb.jpg
URL: <http://mailman.fsr.com/pipermail/constructionlaw/attachments/20110711/fe6fa63b/LEED_GArgb.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image001.jpg
Type: image/jpeg
Size: 16088 bytes
Desc: image001.jpg
URL: <http://mailman.fsr.com/pipermail/constructionlaw/attachments/20110711/fe6fa63b/image001.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image002.jpg
Type: image/jpeg
Size: 14683 bytes
Desc: image002.jpg
URL: <http://mailman.fsr.com/pipermail/constructionlaw/attachments/20110711/fe6fa63b/image002.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image003.jpg
Type: image/jpeg
Size: 3857 bytes
Desc: image003.jpg
URL: <http://mailman.fsr.com/pipermail/constructionlaw/attachments/20110711/fe6fa63b/image003.jpg>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: image004.gif
Type: image/gif
Size: 3392 bytes
Desc: image004.gif
URL: <http://mailman.fsr.com/pipermail/constructionlaw/attachments/20110711/fe6fa63b/image004.gif>