An owner wants to transfer a $40,000 claim of lien from the property to a surety bond. Besides the $40,000 and interest at the legal rate for 3 years, what must the bond include?
Correct Answer
C) $10,000, being 25 percent of the amount demanded, since that exceeds $5,000
Section 713.24(1)(b) requires a bond "in an amount equal to the amount demanded in such claim of lien, plus interest thereon at the legal rate for 3 years, plus $5,000 or 25 percent of the amount demanded in the claim of lien, whichever is greater, to apply on any attorney fees and court costs." Twenty-five percent of $40,000 is $10,000, which is greater than $5,000, so $10,000 is the figure. The $5,000 is a floor, not a fixed amount.
Why This Is the Correct Answer
Section 713.24(1)(b) requires a bond "in an amount equal to the amount demanded in such claim of lien, plus interest thereon at the legal rate for 3 years, plus $5,000 or 25 percent of the amount demanded in the claim of lien, whichever is greater, to apply on any attorney fees and court costs." Twenty-five percent of $40,000 is $10,000, which is greater than $5,000, so $10,000 is the figure. The $5,000 is a floor, not a fixed amount.
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