A general contractor subcontracts electrical work valued at $25,000. The electrical subcontractor fails to pay their suppliers. Under Florida Statutes Chapter 713, what is the general contractor's potential lien exposure?
Correct Answer
D) $25,000 maximum
Under Florida Statutes Chapter 713, the general contractor's lien exposure is limited to the amount owed to the subcontractor, which is $25,000 in this case. The contractor's property may be subject to liens up to this amount for unpaid supplier bills.
Why This Is the Correct Answer
Under Florida Statutes Chapter 713, the general contractor's lien exposure is capped at the amount of the subcontract. This means the maximum lien exposure equals the value of work performed by the subcontractor who failed to pay suppliers. In this case, since the electrical subcontract was valued at $25,000, the general contractor's maximum lien exposure is $25,000, even if the unpaid supplier bills exceed this amount.
Why the Other Options Are Wrong
Option A: Unlimited liability
This is incorrect because general contractors do have potential liability for subcontractor debts under Florida's lien law. The contractor cannot simply ignore unpaid supplier claims when their subcontractor fails to pay.
Option B: $0 - no liability for subcontractor debts
This is incorrect because Florida law specifically limits the general contractor's lien exposure to the amount of the subcontract, providing protection against unlimited liability for subcontractor debts.
Memory Technique
Think 'Contract Cap' - the general contractor's lien exposure is capped at the subcontract amount, like a ceiling that cannot be exceeded.
Reference Hint
Florida Statutes Chapter 713 - Construction Liens, specifically sections dealing with general contractor liability for subcontractor debts
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