Florida Construction Contract Requirements
Florida Statutes play an integral role in construction contracting. Because Florida Statutes frequently evolve and new requirements are continuously added, it is vital for those involved in the construction industry to stay up to date on the latest construction laws. For these reasons, we recommend contractors and other construction professionals to routinely have their construction contracts and other legal documents reviewed and revised by a qualified and knowledgeable construction attorney in Clearwater. There are certain provisions that contractors and other construction professionals are statutorily required to include in construction contracts, such as displaying your professional contractor's license number, a construction lien law disclosure, and a construction recovery fund disclosure.
License Number Requirements
A professional contractor's license is required to perform specific duties and construction services in Florida. As part of this requirement, licensed contractors are also required to display their license number on promotional materials or vehicles that contain the company or contractor's name on it. In addition, all communications between a contractor and an owner must have the contractor's license number visible on the communication. Communications may include estimates, proposals, contracts, and invoices used in the practice of contracting.
Violators of Section 489.119(5)(b) are subject to penalty. For a first offense, contractors are given notice and an opportunity to correct their violation. Failure to comply within 30 days from notice will result in fines or citations. For all subsequent offenses, violators will be subject to fines or citations without notice.
Construction Lien Law Disclosure
According to Florida Statutes § 713.015, all residential contracts which exceed $2,500 and are related to the improvement of real property consisting of a single family or multi-family dwelling of up to four units are required by law to include a lien law notice on either the first page of the contract in no less than 12 pt., bold-faced and capitalized font or on a separately signed and dated page in no less than 12 pt., bold-faced and capitalized font. The language used on this notice must be similar to the language that is provided in the statute. The construction lien disclosure notifies property owners of their responsibility to ensure that any subcontractors, sub-subcontractors and material suppliers who perform work or supply materials used for the improvement of the property are properly compensated for their services or a lien may be placed on the property, and the right of the property owner to obtain a Release of Lien from any person who has provided a Notice to Owner.
Although failure to include the construction lien law disclosure may affect a prime contractor's ability to exercise their lien rights, the statute does not specify a remedy for failure to include the warning, nor does the failure to include the disclosure affect the lien rights of sub-contractors, sub-subcontractors, or material suppliers not in privity with the owner.
Recovery Fund Disclosure (Residential Contracts)
In addition to the construction lien law disclosure, construction contracts which exceed $2,500 for improvements to real property are required by law to include a construction recovery fund disclosure. This notice should be in essentially that same format and language, capitalized and in bold-faced font as is provided in Florida Statutes § 489.1425. The construction recovery fund disclosure notifies property owners of their right to seek recovery for losses related to unlawful acts of state-licensed contractors.
Omission of the construction recovery fund discolsure required by Florida Statutes § 489.1425 risks a $500 fine for the first offense and a $1,000 fine for each violation thereafter. Parties who suffer from damages of specific violations may claim up to $25,000 in losses against this fund. An experienced and qualified Clearwater construction attorney from Cotney Attorneys & Consultants can assist you with reviewing and drafting of all legal documents.
For more information on our contract review and drafting services, please contact us today.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.