Lien Law Query
Query: Cautious GC wants to protect self/owner from material suppliers
claims. Subs request a deposit for materials they have to buy on a
project. GC wants release of lien from supplier. Some subs are
resisting furnishing a release of lien from supplier, either for deposit
or for full payment to suppliers. This issue comes up when suppliers,
in the ordinary course of business, do not ship material directly to a
specific job site at a specific address and do not have access to
information contained on a NOC. Ex: carpet supplier to flooring sub
who ships carpet to flooring sub under subcontractor order. I know the
basic law on this issue, but from a practical standpoint, are any of you
running into this type of issue, and if so, what resolution are you
working out for your GC/client? In compliance with WWAD?!, please email
me directly, and not "reply to all". Thanks!
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.com blocked::mailto:jburgess@verolaw.com
http://www.verolaw.com blocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and
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If the material delivery is job specific, even if not shipped directly
to the job site, you need a release from the supplier. I would hold up
future payments to the sub until releases have been provided. I've had
situations before where contractors refused to provide releases and I
got them by drafting a dec action complaint (the contract didn't require
releases) saying 713.06's proper payment provisions contemplate
providing releases to the owner and the uncertainty about our
entitlement to demand releases supported a dec action. This has been a
fairly successful tactic, as everyone wants to avoid a lawsuit,
especially where the contractor can offer no legitimate explanation to
the court about why releases aren't being provided.
Go to http://www.floridaconstructionlawauthority.com/ to subscribe to our complimentary Florida Construction Law Blog.
Lee A. Weintraub
Board Certified Construction Lawyer
Becker & Poliakoff, P.A.
Emerald Lake Corporate Park
3111 Stirling Road
Fort Lauderdale, FL 33312-6525
954.985.4147 Phone
954.985.4176 Fax
LWeintraub@becker-poliakoff.com
http://www.becker-poliakoff.com
Our clients' total satisfaction is our #1 priority. The Becker & Poliakoff Client CARE Center is available for questions, concerns and suggestions. Please contact us at 954.364.6090 or via email at CARE@becker-poliakoff.com.
From: constructionlaw-bounces@lists.flabarrpptl.org
[mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of
Croom, Janet
Sent: Tuesday, August 16, 2011 11:54 AM
To: constructionlaw@lists.flabarrpptl.org
Subject: [RPPTL-constructionlaw] Lien Law Query
Query: Cautious GC wants to protect self/owner from material suppliers
claims. Subs request a deposit for materials they have to buy on a
project. GC wants release of lien from supplier. Some subs are
resisting furnishing a release of lien from supplier, either for deposit
or for full payment to suppliers. This issue comes up when suppliers,
in the ordinary course of business, do not ship material directly to a
specific job site at a specific address and do not have access to
information contained on a NOC. Ex: carpet supplier to flooring sub
who ships carpet to flooring sub under subcontractor order. I know the
basic law on this issue, but from a practical standpoint, are any of you
running into this type of issue, and if so, what resolution are you
working out for your GC/client? In compliance with WWAD?!, please email
me directly, and not "reply to all". Thanks!
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.com blocked::mailto:jburgess@verolaw.com
http://www.verolaw.com blocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and
confidential. It is intended only for the use of the individual or
entity named above. If the reader of this message is not the intended
recipient, any dissemination, distribution, or copy of this message is
strictly prohibited. If you have received this message in error, please
immediately notify the sender by via telephone, email, or the U.S.
Postal service at the address above, and destroy the message. Thank you.
If the supplier is not selling for a particular project the supplier Is not a materialman within the definition of 713.01(19). The documentation must show that the materials are at least purchased for "direct delivery to the site" if not delivered to the site. If materials are ordered for stock, and just happen to make it to the site, the definition of materialman is not met.
Assuming that the materials are at least ordered for direct delivery to the site, when someone makes a payment the payor is entitled to a release. The form of the release may be an issue. However even if payment is only a deposit with no materials yet delivered, the supplier should have no valid reason to fail to issue a partial release in the statutory form.
Lee offers a good suggestion about a dec complaint being suggested. In addition, or in the alternative, one could show to the other side (and if necessary file) an action for mandamus.
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@mkpalaw.com
Board Certified in Construction Law
Certified Circuit Court Civil Mediator
Fellow, College of Commercial Arbitrators
From: constructionlaw-bounces@lists.flabarrpptl.org [mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of Croom, Janet
Sent: Tuesday, August 16, 2011 11:54 AM
To: constructionlaw@lists.flabarrpptl.org
Subject: [RPPTL-constructionlaw] Lien Law Query
Query: Cautious GC wants to protect self/owner from material suppliers claims. Subs request a deposit for materials they have to buy on a project. GC wants release of lien from supplier. Some subs are resisting furnishing a release of lien from supplier, either for deposit or for full payment to suppliers. This issue comes up when suppliers, in the ordinary course of business, do not ship material directly to a specific job site at a specific address and do not have access to information contained on a NOC. Ex: carpet supplier to flooring sub who ships carpet to flooring sub under subcontractor order. I know the basic law on this issue, but from a practical standpoint, are any of you running into this type of issue, and if so, what resolution are you working out for your GC/client? In compliance with WWAD?!, please email me directly, and not "reply to all". Thanks!
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.comblocked::mailto:jburgess@verolaw.com
http://www.verolaw.comblocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and confidential. It is intended only for the use of the individual or entity named above. If the reader of this message is not the intended recipient, any dissemination, distribution, or copy of this message is strictly prohibited. If you have received this message in error, please immediately notify the sender by via telephone, email, or the U.S. Postal service at the address above, and destroy the message. Thank you.
I have been requested to share with the group continuation of this lien
law query. (our fearless leader is one of the members requesting, and
so please use WWAD?! accordingly).
DEPOSIT Issue:
Cautious GC requested to pay deposit for materials by sub, allegedly
required by supplier/manufacturer, etc. GC inquires further of exact
amount of required deposit, as GC does not want to fund sub's
operational end of sub's business. Deposit amount allegedly required
then modified downward.
GC will pay deposit if required, but does not want to be left out
substantial amounts of "deposit" monies paid to a sub, if the sub
suddenly goes out of business/disappears. For example, GC uses sub on
15 projects, each requiring at least $50,000 deposit. GC does not
appear entitled to inquire as to relationship between sub and its
supplier/manufacturer. 713.16, Fla. Stat, etc. do not seem to address
this issue.
With the economy so tight in the construction industry, I am seeing a
shift in business to the requirement of many more "deposits" being
required. Shifting the risk of loss appears to be a bit more
complicated in the above scenario, and yet this is where the
construction trend appears to be heading.
Please delete if this issue does not relate to your practice.
Otherwise, please respond to the group with any practical or legal
remedies. Thanks-janet
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.com blocked::mailto:jburgess@verolaw.com
http://www.verolaw.com blocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and
confidential. It is intended only for the use of the individual or
entity named above. If the reader of this message is not the intended
recipient, any dissemination, distribution, or copy of this message is
strictly prohibited. If you have received this message in error, please
immediately notify the sender by via telephone, email, or the U.S.
Postal service at the address above, and destroy the message. Thank you.
From: constructionlaw-bounces@lists.flabarrpptl.org
[mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of
Weintraub, Lee
Sent: Tuesday, August 16, 2011 12:02 PM
To: RPPTL constructionlaw
Subject: Re: [RPPTL-constructionlaw] Lien Law Query
If the material delivery is job specific, even if not shipped directly
to the job site, you need a release from the supplier. I would hold up
future payments to the sub until releases have been provided. I've had
situations before where contractors refused to provide releases and I
got them by drafting a dec action complaint (the contract didn't require
releases) saying 713.06's proper payment provisions contemplate
providing releases to the owner and the uncertainty about our
entitlement to demand releases supported a dec action. This has been a
fairly successful tactic, as everyone wants to avoid a lawsuit,
especially where the contractor can offer no legitimate explanation to
the court about why releases aren't being provided.
Click here http://www.floridaconstructionlawauthority.com/ to
subscribe to our complimentary Florida Construction Law Blog.
http://www.becker-poliakoff.com/ Lee A. Weintraub
Board Certified Construction Lawyer
Becker & Poliakoff, P.A.
Emerald Lake Corporate Park
3111 Stirling Road
Fort Lauderdale, FL 33312-6525
954.985.4147 Phone
954.985.4176 Fax
LWeintraub@becker-poliakoff.com
www.becker-poliakoff.com
Our clients' total satisfaction is our #1 priority. The Becker &
Poliakoff Client CARE Center is available for questions, concerns and
suggestions. Please contact us at 954.364.6090 or via email at
CARE@becker-poliakoff.com mailto:CARE@becker-poliakoff.com .
From: constructionlaw-bounces@lists.flabarrpptl.org
[mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of
Croom, Janet
Sent: Tuesday, August 16, 2011 11:54 AM
To: constructionlaw@lists.flabarrpptl.org
Subject: [RPPTL-constructionlaw] Lien Law Query
Query: Cautious GC wants to protect self/owner from material suppliers
claims. Subs request a deposit for materials they have to buy on a
project. GC wants release of lien from supplier. Some subs are
resisting furnishing a release of lien from supplier, either for deposit
or for full payment to suppliers. This issue comes up when suppliers,
in the ordinary course of business, do not ship material directly to a
specific job site at a specific address and do not have access to
information contained on a NOC. Ex: carpet supplier to flooring sub
who ships carpet to flooring sub under subcontractor order. I know the
basic law on this issue, but from a practical standpoint, are any of you
running into this type of issue, and if so, what resolution are you
working out for your GC/client? In compliance with WWAD?!, please email
me directly, and not "reply to all". Thanks!
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.com blocked::mailto:jburgess@verolaw.com
http://www.verolaw.com blocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and
confidential. It is intended only for the use of the individual or
entity named above. If the reader of this message is not the intended
recipient, any dissemination, distribution, or copy of this message is
strictly prohibited. If you have received this message in error, please
immediately notify the sender by via telephone, email, or the U.S.
Postal service at the address above, and destroy the message. Thank you.
Couple thoughts:
1. In this market, GC's are dictating terms to subs. If not
already in place, the master form of Subcontract Agreement should be
modified to provide for: (i) delivery to GC of any invoice or billing
from supplier to Subcontractor for deposit monies, (ii) payment by
joint check to suppliers of Subcontractor requiring deposit in advance
of delivery of materials, (iii) delivery to GC, upon request, of any POs
or subcontracts entered into by Subcontractor, (iv) execution and
delivery of a Partial Lien Release by Subcontractor and supplier in
amount of deposit, (v) approval by GC of the creditworthiness of any
supplier of Subcontractor requiring a deposit payment prior to delivery
of materials to job site, and (vi) incorporation of the prior points (i)
-(v) in any subcontract or PO entered into by Subcontractor.
2. In absence of favorable Subcontract terms, make a request for
copy of the PO between Subcontractor and supplier pursuant to Fla. Stat.
s. 713.16 (1). GC should do this to confirm accurate amount of deposit
and avoid the hidden sub mark-up to fund Sub's operations as you note
below.
3. In this context, GC needs to underwrite creditworthiness of
both Sub and supplier.
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@lowndes-law.com
mailto:michael.gibbons@lowndes-law.com
website: http://www.lowndes-law.com http://www.lowndes-law.com/
From: constructionlaw-bounces@lists.flabarrpptl.org
[mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of
Croom, Janet
Sent: Wednesday, August 17, 2011 9:00 AM
To: RPPTL constructionlaw
Subject: Re: [RPPTL-constructionlaw] Lien Law Query FOLLOW UP
CONSTRUCTIONDEPOSIT QUERY
I have been requested to share with the group continuation of this lien
law query. (our fearless leader is one of the members requesting, and
so please use WWAD?! accordingly).
DEPOSIT Issue:
Cautious GC requested to pay deposit for materials by sub, allegedly
required by supplier/manufacturer, etc. GC inquires further of exact
amount of required deposit, as GC does not want to fund sub's
operational end of sub's business. Deposit amount allegedly required
then modified downward.
GC will pay deposit if required, but does not want to be left out
substantial amounts of "deposit" monies paid to a sub, if the sub
suddenly goes out of business/disappears. For example, GC uses sub on
15 projects, each requiring at least $50,000 deposit. GC does not
appear entitled to inquire as to relationship between sub and its
supplier/manufacturer. 713.16, Fla. Stat, etc. do not seem to address
this issue.
With the economy so tight in the construction industry, I am seeing a
shift in business to the requirement of many more "deposits" being
required. Shifting the risk of loss appears to be a bit more
complicated in the above scenario, and yet this is where the
construction trend appears to be heading.
Please delete if this issue does not relate to your practice.
Otherwise, please respond to the group with any practical or legal
remedies. Thanks-janet
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.com blocked::mailto:jburgess@verolaw.com
http://www.verolaw.com blocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and
confidential. It is intended only for the use of the individual or
entity named above. If the reader of this message is not the intended
recipient, any dissemination, distribution, or copy of this message is
strictly prohibited. If you have received this message in error, please
immediately notify the sender by via telephone, email, or the U.S.
Postal service at the address above, and destroy the message. Thank you.
From: constructionlaw-bounces@lists.flabarrpptl.org
[mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of
Weintraub, Lee
Sent: Tuesday, August 16, 2011 12:02 PM
To: RPPTL constructionlaw
Subject: Re: [RPPTL-constructionlaw] Lien Law Query
If the material delivery is job specific, even if not shipped directly
to the job site, you need a release from the supplier. I would hold up
future payments to the sub until releases have been provided. I've had
situations before where contractors refused to provide releases and I
got them by drafting a dec action complaint (the contract didn't require
releases) saying 713.06's proper payment provisions contemplate
providing releases to the owner and the uncertainty about our
entitlement to demand releases supported a dec action. This has been a
fairly successful tactic, as everyone wants to avoid a lawsuit,
especially where the contractor can offer no legitimate explanation to
the court about why releases aren't being provided.
Click here http://www.floridaconstructionlawauthority.com/ to
subscribe to our complimentary Florida Construction Law Blog.
http://www.becker-poliakoff.com/ Lee A. Weintraub
Board Certified Construction Lawyer
Becker & Poliakoff, P.A.
Emerald Lake Corporate Park
3111 Stirling Road
Fort Lauderdale, FL 33312-6525
954.985.4147 Phone
954.985.4176 Fax
LWeintraub@becker-poliakoff.com
www.becker-poliakoff.com
Our clients' total satisfaction is our #1 priority. The Becker &
Poliakoff Client CARE Center is available for questions, concerns and
suggestions. Please contact us at 954.364.6090 or via email at
CARE@becker-poliakoff.com mailto:CARE@becker-poliakoff.com .
From: constructionlaw-bounces@lists.flabarrpptl.org
[mailto:constructionlaw-bounces@lists.flabarrpptl.org] On Behalf Of
Croom, Janet
Sent: Tuesday, August 16, 2011 11:54 AM
To: constructionlaw@lists.flabarrpptl.org
Subject: [RPPTL-constructionlaw] Lien Law Query
Query: Cautious GC wants to protect self/owner from material suppliers
claims. Subs request a deposit for materials they have to buy on a
project. GC wants release of lien from supplier. Some subs are
resisting furnishing a release of lien from supplier, either for deposit
or for full payment to suppliers. This issue comes up when suppliers,
in the ordinary course of business, do not ship material directly to a
specific job site at a specific address and do not have access to
information contained on a NOC. Ex: carpet supplier to flooring sub
who ships carpet to flooring sub under subcontractor order. I know the
basic law on this issue, but from a practical standpoint, are any of you
running into this type of issue, and if so, what resolution are you
working out for your GC/client? In compliance with WWAD?!, please email
me directly, and not "reply to all". Thanks!
Janet Carney Croom, Esquire
Board Certified - Construction Law
Board Certified - Business Litigation
Collins, Brown, Caldwell, Barkett & Garavaglia, Chartered
756 Beachland Boulevard
Vero Beach, FL 32963
Telephone: 772-231-4343
Fax: 772-234-5213
jcroom@verolaw.com blocked::mailto:jburgess@verolaw.com
http://www.verolaw.com blocked::mailto:www.cbc@verolaw.com
The information contained in this message is legally privileged and
confidential. It is intended only for the use of the individual or
entity named above. If the reader of this message is not the intended
recipient, any dissemination, distribution, or copy of this message is
strictly prohibited. If you have received this message in error, please
immediately notify the sender by via telephone, email, or the U.S.
Postal service at the address above, and destroy the message. Thank you.
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