Chapter 713 Lien Law Information for the Homeowner
The difference? One is left with a gutted home and a hefty lien.
The Quinn’s were originally looking to purchase a new home, but found that everything in their price range needed some work.
“Any house you looked at needed some remodeling done,” said Greg Quinn. “It was just cheaper to stay here and remodel.”
Tired of high home prices for handyman special houses, the Quinn’s found Len Ericson Contractors through word of mouth and hired them to renovate their home. A new two car garage, roof and siding were among the Quinn’s renovations. However, when they signed the paperwork to begin remodeling, like so many other homeowners, did not see the Chapter 713 construction lien law, printed in bold 18 point font.
Even though they found out about the lien law after the construction began, the Quinn’s “aren’t too worried about it.”
“Our contractor is reputable. Otherwise, that might concern me,” said Gregg Quinn.
Jennifer and Tim Lesley weren’t as lucky.
Since April, the Lesley’s have been working with Stone Park Construction Inc. in Largo to create their 400 square foot three-season room. Instead of a home improvement, the Lesley’s now face a room half-done with uneven windows, cracked concrete and a leaking roof.
On Sept. 22 the Lesley’s received a claim of lien from Construction Materials Inc. in Alabama which is a subcontractor used by their contractor Edward “Shane” Tuttle.
“I was upset when I received the lien, but I wasn’t surprised,” Tim Lesley said.
It wasn’t until after they received the lien that the Lesley’s discovered that Stone Park Construction Inc. was in trouble financially, and that they weren’t the first to have problems with Tuttle.
Now, they Lesley’s are faced with finishing the project on their own, which has put them $25,000 in debt.
“The problem is we have run out of money. We’re in trouble right now. We can’t afford electric or food in the house, and we have to finish the room ourselves,” Jennifer Lesley said.
The Lesley’s didn’t know about the law either, and never even had to sign a contract for their renovations.
In recent years, the Chapter 713 lien law has been the bane of homeowners and a loophole of sorts for dishonest contractors. The law states that the homeowner is liable for all costs accrued during construction including labor and materials-even if the contractor has already been paid.
If a homeowner hires a dishonest or unprofessional contractor, he legally could be forced to pay for their renovation twice or have a lien placed on his home. In many cases, if the homeowner had educated themselves about their contractor or Chapter 713 construction lien law, they could have avoided paying twice.
Unfortunately, most homeowners don’t know about Chapter 713 before they begin construction, said Charlie Arnold, P. A., of Arnold & Burguieres law firm in St. Petersburg.
“In lots of cases, we see where homeowners really aren’t versed in what the law is and we’re forced to educate them,” Arnold said. “Of course, when we explain what the circumstances are, it is problematic for them.”
Some of these problems range from improperly filed lien wavers to completely false documents. Arnold warns homeowners who plan to have significant construction done to have an attorney review contracts before they are signed. These documents could provide false information or be written in the favor of the contractor, or may not even be legally binding at all, and after a contract is signed, there is little chance of recourse.
“Bad contractors provide poorly worded contracts, and they could be what’s called adhesion contracts that are one sided and in the favor of the contractor,” Arnold said. “Once you sign it, you could be at the contractor’s mercy.”
Arnold is a construction lawyer who has represented both contractors and homeowners and has dealt with Chapter 713 in the past. He said that he is involved in cases dealing with Chapter 713 construction lien law sometimes on a weekly basis.
“In many instances we see a result in people not hiring licensed contractors or licensed contractors in financial difficulty,” said Arnold. “Therefore, it is a very difficult process for people to locate and ensure that they hire a good contractor in the initial instance. Many problems unfold from hiring a bad contractor.”
Arnold doesn’t suspect that the construction lien law will be changed any time soon, mainly because it is drafted in favor of the contractors. As long as the construction industry is constantly booming in Florida, and construction costs are high, the lien law will probably keep its place. Furthermore, Arnold said that Chapter 713 has supporters from the construction industry.
“I believe that the building lobby is strongly involved with reviewing it on an annual basis and ensuring that it is favorable for contractors,” Arnold said.
So what’s a homeowner to do?
Arnold suggests that if you are already facing a lien, that you should consult a good real estate attorney early. However, he suggests that protecting yourself beforehand is the best defense for homeowners.
“The best recourse that a homeowner has is to demand that a contractor provide lien wavers from any and all subcontractors and suppliers before completing any services or materials to a job site,” Arnold said.
The release of lien form is available at retail stores like Office Depot or can be printed from the Pinellas County website.
“If you deal with the contractor as an educated consumer, you can put the contractor on notice that you are in fact educated and hopefully avoid a contractor demolishing half of (your home), tear out the bathroom and all of the kitchen and not come back,” Arnold said.
While this has yet to happen to Greg and Elizabeth Quinn, Jennifer and Tim Lesley weren’t as lucky, and now face liens of more than $1,200 on their home. The Lesley’s are now a little wiser, but left with a mess in their home and a hole in their pockets.
“I would have several estimates done on paper,” Tim Lesley said. “I would ask for a binding contract with a finish date on it and exact cost. I would research the company you decide to go with, and get a release of lien.”
