When a party to a construction project goes unpaid, mechanics liens are the best way to enforce payment. By filing a lien, an unpaid party clouds the title to the property. Because their title is in jeopardy, a property owner is usually quick to resolve the dispute. Should the party remain unpaid, they may foreclose the lien and force a sale of the property to recoup payment.
With the potential of a forced sale looming, liens on big-name projects are always interesting. That’s why our interest was piqued when we saw that a steel fabricator filed a mechanics lien against Disney.
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Last week, we wrote about another interesting Florida case where (allegedly) fraudulent mechanics liens were filed following a breakup.
Was that pun a stretch? Anyway, a material supplier who worked on a project in Disney World’s Magic Kingdom went unpaid. After providing specially fabricated steel and other services, the sub missed out on nearly $80K. According to the Orlando Sentinel, work on the project included alterations to the Verandah Restaurant, where character meet-and-greets often occur.
The supplier, who had no direct contract with Disney, brought this to the attention of the general contractor. The GC failed to meet payment demands. Running out of options, the supplier filed a mechanics lien against Disney.
Specially Fabricated Materials in Florida
In Florida there are Special Mechanic Lien Rules for Specially Fabricated Materials. Specifically, a provider of these materials must send a preliminary notice earlier than other claimants. Specially fabricated materials are not exempt from Florida’s requirement that materials must be incorporated in order to be liened. However, a carveout has been created for a situation where these materials were manufactured according to contract and the failure to incorporate the materials was not the fault of the supplier. This exception even applies where the materials never arrive at the job site.
The strength of a mechanics lien filing lies in the underlying threat of a forced sale. However, I think we can all agree that the $80K bill owed to a specialty steel fabricator won’t result in the sale of Disney World. Still, the mechanics lien against Disney will force a response to the fabricator’s claims. After exhausting all efforts to recover from the general contractor, a mechanics lien provided an alternative route to recovery for this supplier. Considering Florida courts are not known for their lien-iency, it’s a good thing they understood the preliminary notice and timing requirements.