An owner records a conditional payment bond and believes the property is now shielded from construction liens. Is it?
Correct Answer
A) No, the property is not exempt from liens filed under part I
Section 713.245(3) states that the owner's property is not exempt from liens filed under part I, and that all lienors must comply with the part to preserve and perfect their lien rights. That is the trade-off for a bond whose coverage is limited to what the contractor has been paid.
Why This Is the Correct Answer
Section 713.245(3) states that the owner's property is not exempt from liens filed under part I, and that all lienors must comply with the part to preserve and perfect their lien rights. That is the trade-off for a bond whose coverage is limited to what the contractor has been paid.
Why the Other Options Are Wrong
Option B: Yes, a recorded bond transfers all lien claims onto the bond itself
Recording does not transfer lien claims onto the bond.
Option C: No, unless the bond amount equals the full contract price
Bond amount does not make the property exempt.
Option D: Yes, as to lienors not in privity with the contractor
All lienors keep their rights under part I.
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