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Subcontractors can seek a lien instead of suing a business

On Behalf of | Nov 9, 2023 | Real Estate Law

Subcontractors work for construction firms or other contractors during construction projects. Many companies find that it is more cost-effective to hire subcontractors on a project-by-project basis than it is to hire them permanently. Subcontractors often enjoy such arrangements as well, as they can set their own schedules and pick projects that pay well or that fall within their realm of personal expertise. However, there is always a risk that the company hiring subcontractors will fail to follow through on payment arrangements.

These companies may delay paying what they owe to workers or refuse to settle their final invoices for a project. If that occurs, subcontractors may find that pursuing a construction lien is a better solution than taking the business to court.

Construction liens cut out the middleman

Technically, the person hiring a company to do work on their property is responsible for the cost of materials and labor provided for the project. Property owners often take for granted that construction firms will pay everyone involved with the project appropriately. Thankfully, Florida state law recognizes that there are many scenarios in which property owners pay construction firms in full but material providers and subcontractors do not receive what they should. Any party who has provided labor or materials for a Florida construction project can potentially request a lien against the property where they did the work.

It does not matter whether the homeowner paid in full for their obligations. What matters is that the individuals involved in the project did not receive their share of those funds. The civil courts can award subcontractors a construction lien that the homeowner will then need to address before they refinance or sell the property.

Typically, property owners served notice of an upcoming construction lien case will take the matter up with the construction firm that failed to pay the subcontractor. Seeking a lien is a very effective approach because it puts pressure on the business from the client. A successful lien attempt by a subcontractor could damage a company’s reputation not just with other contractors but also with property owners who might hire the company in the future.

Learning about the kinds of recourse available as a professional who has not been properly paid for their services may benefit those who have provided materials or work and who have not received what they are owed.