You are managing a project where the owner has not paid your latest progress payment of $85,000, which was due 45 days ago. Under Florida Statute Chapter 713, you want to preserve your lien rights. What is your next required action?
Correct Answer
A) Record a claim of lien
To preserve lien rights when payment is overdue, the contractor must record a claim of lien within the statutory timeframe (typically 90 days from last furnishing labor or materials). This formal document establishes the lien against the property.
Why This Is the Correct Answer
Under Florida Statute Chapter 713, when a contractor is not paid and wants to preserve lien rights, they must record a claim of lien within 90 days of last furnishing labor or materials. This formal recording creates a legal encumbrance against the property and is the required statutory action to preserve lien rights. The claim of lien must be recorded in the public records of the county where the property is located and contain specific information required by statute.
Why the Other Options Are Wrong
Option C: Send a notice to owner
Stopping work is not a statutory requirement for preserving lien rights and could actually be detrimental. Continuing to work without recording a lien claim could cause the contractor to lose lien rights if the 90-day deadline passes. Work stoppage is a business decision, not a lien preservation requirement.
Option D: Stop all work on the project
Sending a notice to owner is not the required action at this stage. While various notices may be required earlier in the process (such as Notice to Owner), when payment is overdue and lien rights need to be preserved, the statutory requirement is to record a claim of lien, not send additional notices.
Memory Technique
Think 'RECORD to PRESERVE' - when payment is overdue, you must RECORD a claim of lien to PRESERVE your lien rights. The 90-day clock is ticking from last work performed.
Reference Hint
Florida Statute Chapter 713 - Construction Liens, specifically sections dealing with claim of lien requirements and timeframes
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