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NTO CONCERN

WE HAVE A CUSTOMER THAT HAS 3 BLDGS. PHASE I, PHASE II, AND PHASE III. WE ONLY HAD CONTRACTS FOR PHASE I & II. THE CUSTOMER WAS PURCHASING MATERIALS FOR PHASE III UNDER THE PHASE II ACCOUNT. APPARENTLY THEY HAVE BEEN PURCHASING SINCE APRIL. WE MISSED THE NTO DATE FOR THE PHASE III. ON 7/15 THEY SIGNED THE PO FOR PHASE III. WE NEED TO CREDIT AND REBUILD HOWEVER WHAT CAN WE DO TO HAVE LIEN RIGHTS SHOULD WE NEED TO LIEN FOR NON-PAYMENT. WE ARE ABOUT TO LIEN THE PHASE II PROJECT FOR NON-PAYMENT. DO WE LIEN FOR ALL OF PHASE II AND III INVOICES TO COVER OURSELVES? HOW CAN WE FIX THIS MESS TO KEEP US PROTECTED. THIS IS A 4MILL DOLLAR PROJECT WE CANT HAVE UNPROTECTED. HELP!

2 replies

Jul 24, 2020

First, note that one claim of lien can span multiple lots, parcels, or tracts of land if the work is all done under one direct contract and all lots, parcels, or tracts are owned by the same owner. So, if the work is all being done for the same overarching project, and if it's all for the same owner, note that a single lien claim could cover more than a single parcel.

When multiple contracts are used, multiple claims may be necessary

With that being said, using multiple, separate contracts may require multiple claims. If you've entered into separate contracts, then a separate mechanics lien may be required for those separate contracts - and if that's the case, separate NTO's should be sent for each separate contract. Levelset discusses the potential need for multiple liens and potential NTO's in these articles: (1) Can You File One Lien While Working Under Multiple Contracts?; and (2) Florida Notice to Owner — Do You Have to Send More Than One? So, putting all of that information together: If you've signed a contract for the third phase of the project, then a separate NTO may need to be sent for that contract. And, any materials provided under that contract should likely fall under a separate lien, if one must be filed. But, to the extent that materials were provided under a contract for a different phase: If an NTO was sent for that contract, if the materials were being provided under the same overarching direct contract/project, and if the properties are all owned by the same owner - then lien rights should be protected for work done under the previous NTO.

Additional resources

For more discussion on Florida's Notice to Owner rules: Florida NTO Guide & FAQs. Additionally, considering the size of the claims here and the complexity of the project, keep in mind that consulting a Florida construction lawyer might be useful as well. If you think that'd help, you can begin the search for the right lawyer here: Find a Florida Construction Lawyer.

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Jul 25, 2020

You should consult with an attorney. Depending on the contracts and the corporate structure of the owner and GC, you may have a problem or you may not. Your first NTO may cover all of the project or it may not. Feel free to reach out if you have further questions.

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