Serving a valid preliminary notice on time is typically the most important requirement in preserving one’s lien rights. In most states, failing to serve the required preliminary notices will nullify a construction party’s right to file a mechanics lien over a certain project.
In Florida, almost all parties are required to file a Notice to Owner. This preliminary notice is served early during the course of a project, typically within 45 days of a party’s first day of work.
The Notice to Owner generally informs a property owner about the construction party’s involvement in a project, and it also serves as a warning that a party may file a mechanics lien if payment delays or disputes arise.
However, not all parties are required to serve a Florida Notice to Owner. There are five main exceptions to the Florida Notice to Owner requirement. Read on to know if you are one of the parties who are exempted from Florida’s preliminary notice rules.
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Parties exempted from serving a Florida Notice to Owner
1. Those who have a direct contract with a property owner
Parties who have a direct contractual relationship with a property owner are not required to serve a Florida Notice to Owner. The assumption here is that the property owners already know which contractors they are directly dealing with, so they no longer need to receive a notification about the contractors’ involvement in the project.
Similarly, parties who act both as the property owner and the general contractor are not required to serve a Notice to Owner. This scenario happens when a property owner is also a developer who owns their own construction company that can perform the work. It goes without saying that they do not need to send themselves a preliminary notice.
One sticky situation general contractors might find themselves in is when they are dealing with a third-party agent. A property owner may hire an agent or a developer, for example, and the developer will hire a general contractor.
Technically, the property owner’s agent is bound to the property owner, so the general contractor is considered to have a direct contract with the property owner. Following this rule, general contractors who are directly hired by a property owner’s agent or developer are also exempt from the Notice to Owner requirement.
However, if this specific exemption applies to you, serving a Notice to Owner on the property owner(s) is probably still a good idea. Payment disputes may arise between you and the agent, so fulfilling the Notice to Owner requirement is a safe way to ensure that your lien rights remain protected.
2. Those who work as laborers
Laborers are explicitly exempted from having to serve a Notice to Owner. If your potential lien claim will be primarily based on your wage earnings as a laborer, you do not have to serve a Notice to Owner on the property owner.
Note, however, that you must strictly be a laborer on a project. Laborers furnish only labor on a project, so if you also supply materials, you will no longer be considered a laborer and it is best to serve a Notice to Owner to protect your lien rights.
3. Those who qualify as “professional” claimants
Potential lien claimants who have a professional designation are also exempted from serving a Florida Notice to Owner. Professional lien claimants in Florida include the following:
- Architect/landscape architect
- Interior designer
- Engineer/construction engineer
- Land surveyor
If you qualify as one of those parties listed above, you do not have to serve a Notice to Owner to protect your right to record a Florida mechanics lien.
4. Those who are working on subdivisions
Parties who are furnishing labor or materials to a project that concerns the improvement of a subdivision are not required to serve a Notice to Owner. This exception applies regardless of your contractual relationship with a property owner, whether you are in direct contact with them or not.
If you are unsure if your project counts as a subdivision improvement or construction, it is best practice to still serve a Notice to Owner on the property owner. Serving a valid Notice to Owner is still the safest way to go and you do not want to risk losing your lien rights over a technicality or a minor misunderstanding of the rules.
5. Those who have no mechanics lien rights in Florida
Finally, all construction parties who are not covered by the mechanics lien rules of Florida are of course exempted from the Notice to Owner requirement. The Notice to Owner preserves the mechanics lien rights of a potential lien claimant, so if you have no lien rights to start with, you are not mandated to serve this notice.
Parties who are not protected by Florida’s mechanics lien laws are the following:
Those who work on federal projects.
Remember that a mechanics lien may be filed against private property projects. Those who have payment claims over federally funded projects may not file a mechanics lien, but they may make a bond claim to recover payment.
Those who are general contractors in a project that is worth below $2,500.
If you have a direct contract with a property owner and your expected payment is $2,500 or less, you are not protected by Florida’s mechanics lien laws and are exempted from serving a Notice to Owner.
Those who work on sovereign tribal lands
Florida’s laws on Indian Affairs grant sovereign immunity to tribal lands, so parties working on construction projects on those lands are generally not permitted to file a mechanics lien to recover payment. You may consider negotiating with the tribe to specify in your contract that they are allowing you to file a mechanics lien if you do not get paid.
Always remember that if you are unsure whether you are exempt from the prelimimary notice requirement or not, it is best practice to still serve a Notice to Owner on the property owner(s). Not only are you being proactive in protecting your lien rights, but you are also opening communication lines with a property owner. If they have any concerns or questions, these conversations are better had during the beginning of a project.