[RPPTL-constructionlaw] CLC Conference call in 90 minutes

Mon Mar 11 07:53:05 PDT 2013

Folks,

Following is an updated summary for March of the Bills which the Legislative Subcommittee has been asked to review and provide comments.

Proposed Bill

CLC Proposed Action

SB 530 (Revised Arbitration Code)

In order to address the potential argument that the court no longer has authority to stay an arbitration proceeding where it finds no agreement to arbitrate exists, the CLC recommended adding the words "and the court may stay any arbitration proceeding that has been initiated or threatened" to the end of new Section 682.03 (3) on page 13 of 38.

SB 286 (Limitation of Design Professional's Liability)

For the same reasons the CLC opposed the 2012 version of this Bill, the CLC opposes this Bill.

SB 112 (Fraudulent Liens)

As worded, 713.31 would only apply to a "person who fraudulently records a claim of lien."  First, it was unclear to us what this requires (e.g. does it require an adjudication that someone fraudulently recorded a lien?).  Second, it is unclear how someone fraudulently records a lien to begin with (e.g. by telling someone you aren't recording one, but then doing so anyway?)
We felt the issue is whether the lien is fraudulent, as opposed to whether the lien was fraudulently recorded.  Therefore, the CLC proposed modifying the exception language to read as follows: "Claims for fraudulent liens filed pursuant to part I of chapter 713 shall be governed by s. 713.31 and are excluded from this section."

HB 285 (Judgment Liens)

No need for the CLC to take any position on this Bill.

SB 1166 (Adverse Possession)*

No need for the CLC to take any position on this Bill.  However, we made a few minor comments and noted what appeared to be an inconsistency in the use of terms.

HB 889 (Lien Law)*

As currently proposed, the CLC opposes this Bill for the following reasons:

1.       The change regarding the timing for serving a notice to owner (NTO): This change alters the timing of serving an NTO so it is based on the payment terms of a vendor. A potential lienor can create its own timing requirements simply by establishment of its payment terms, which anyone outside the transaction will have no way of knowing.  This removes the more certain standard (i.e. no later than 45 days after commencing work, but in any event before the owner's final payment) that has been part of the lien law for a generation, is well-defined in the case law and well understood in the industry.  This unnecessarily creates uncertainty and will likely create a tremendous amount of new litigation.

2.       The change requiring the contractor to give a notarized list: This change would require contractors to provide owners with addresses and phone numbers of each person owed money for a payment application along with written releases that are currently required. Under 713.06, the owner already has the right to request an affidavit from the contractor in connection with any progress payment. Requiring a notarized list with every application for payment appears to be overkill, and may give the owner more information than he/she wants or needs.  It could also be self-defeating for owners, such as the case where a sub voluntarily releases lien rights by giving a lien waiver to the GC, even though the GC has not yet paid, with the expectation of receiving payment from the GC later.  In this case, the GC could not truthfully swear that the sub was paid, and would have to list the sub in the verified statement.  In this situation, the owner might rather not have that information, because the owner otherwise could have relied in good faith on the unconditional lien release (having no knowledge of the non-payment).  In short, this requirement appears to be a "one size fits all" approach that is too inflexible.

3.       Elimination of improper payments after a notice of commencement (NOC) expires:  By removing the penalty for the owner failing to keep an effective NOC in place, the owner no longer has any incentive to do so. This requirement keep an effective NOC in place is very important in part because it protects laborers and small business men and women who rely upon prompt payment to pay their bills and make payroll.  By eliminating the proper payments defense, it becomes easier for owners to ignore the risk of liens and leave unpaid these hardworking men and women who employ thousands (if not millions) of Floridians.  Therefore, it is better that the owner have some downside risk from not keeping the NOC current.

However, we suggested we might be able to work with the Bill's sponsor if we had a better understanding of the reasons behind the proposed changes.

* proposed Bills new to this month's report

Copies of the two proposed Bills that were added to this month's report are attached for your reference. We will continue to monitor the progress of these Bills and weigh in as appropriate.

Regards,

Scott Pence

4221 W. Boy Scout Blvd., Ste. 1000

Tampa, Florida  33607-5780

Direct:  813.229.4322 | Fax:  813.229.4133

-----Original Message-----
From: constructionlaw-bounces at lists.flabarrpptl.org [mailto:constructionlaw-bounces at lists.flabarrpptl.org] On Behalf Of Arnold D. Tritt, Jr.
Sent: Monday, March 11, 2013 10:04 AM
To: RPPTL constructionlaw
Subject: [RPPTL-constructionlaw] CLC Conference call in 90 minutes

Gang:  As promised, see attached the agenda for today's CLC conference call which includes the call-in information. Also attached are Christi's bio and a checklist which is part of Christi's and LRL's presentation.  Talk to you in an hour. Arnie.

Arnold D. Tritt, Jr.

Board Certified Construction Attorney

707 Peninsular Place

Jacksonville, Florida 32204

Phone (904) 354-5200

Facsimile (904) 354-5256

Arnold.Tritt at atritt.com

www.atritt.com

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