[RPPTL-constructionlaw] question re: priority of claims to insurance proceeds

[Larry Leiby]

Andrea,

You may want to make the owner and lender aware that your client also has a lien on the insurance proceeds pursuant to F.S. 713.32.  It sounds like your lien is inferior to the lien of the lender, but the lender also needs to be made aware of your claims (against the proceeds and the property).   The lender should cooperate if it has been timely paid.  If not ….  Interpleader will likely end up in the owner seeking fees.  If you file your action to enforce against the property and the insurance proceeds and you are successful, the owner should not be able to claim fees. See 457 So.2d 597.

Larry R. Leiby, Esq.
Malka & Kravitz, P.A.
1300 Sawgrass Corp. Pkwy., Suite 100
Ft. Lauderdale, FL  33323
Phone:  954-514-0984
Fax:      954-514-0985

e-mail:  leiby at mkpalaw.com

Board Certified in Construction Law
Fla. S. Ct. Certified Circuit Court Civil Mediator
Fellow, College of Commercial Arbitrators


From: constructionlaw-bounces at lists.flabarrpptl.org [mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of Andrea Fair
Sent: Thursday, September 29, 2011 9:58 AM
To: RPPTL constructionlaw
Subject: [RPPTL-constructionlaw] question re: priority of claims to insurance proceeds

I represent a contractor who furnished ground stabilization related to sinkhole activity.  My client has a lien on the property for the work.  The insurance company has cut a check payable to the owner, my client, and the mortgage lender.  The owner’s attorney is holding the check but is trying to get the insurance company to drop the owner’s name from the check and reissue a new check (I suppose to avoid any involvement in a dispute between my client and the lender for the insurance proceeds).  The owner is also considering interpleader.  The lender has requested that the owner endorse the check and send it to them and then they will consider what to do with it from there.  The owner does not want to do that because they feel the lender will not release the funds to my client and then the owner still has liability to my client.  The mortgage was recorded before the NOC for my client’s work.  The mortgage provides that insurance proceeds will be applied to restoration or repair of the property if it is economically feasible and lender’s security is not lessened.  Any suggestions on how to proceed from this point?


Andrea M. Fair-Purcell
Board Certified Construction Attorney
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FAIR•LAW•PLLC
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13046 Racetrack Road #236
Tampa, FL 33626
(813) 412-1077 phone
(877) 879-4990 fax
www.fairconstructionliens.com

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