Protecting Yourself as a Contractor: The Importance of Notice Commencement and Lien Laws

When you are in possession of your Florida contractor’s license and ready to start working on large-scale projects, it is essential to take the time to ensure that proper procedure is followed. This not only benefits you as the contractor’s license holder, but also the workers who will complete the project alongside you.

What is a Notice Commencement?

A Notice Commencement is a legal document that makes a project’s commencement known, which is filed by the owner of the property, or the owner’s agent. This document should be used when making improvements or alterations to a property which total $2500 or more ($7500 for mechanical) and should be displayed prominently at the job site. It provides critical information, such as the property owner’s name and address, and the address of the project. These details are important for everyone who is working on the project, like the workers who are providing labor and materials, so that they are able to file a Notice to Owner and secure their lien rights.

The Notice Commencement must be filed before the project begins, but no more than 90 days before the start of the project. Failure to begin the project within 30 days of recording voids the notice.

How does it Benefit Me?

As an individual with a contractor’s license in Florida, the information contained within the Notice Commencement is vital in case there are issues with payment and it becomes necessary to file a lien.

What is a Lien?

Whether you hold a general contractor license or something more specialized, it is essential to be aware of the possibility that you may need to file a lien if the client or owner is withholding payment.

A lien gives the contractor the right to keep possession of property belonging to someone else until the debt owed by that person is paid. It is a very powerful way to protect your rights as someone with a Florida contractor’s license, but it must be noted that a lien is only valuable to you if you file the claim entirely correctly.

When Should a Lien be filed?

If a client stops making payments and cuts off all contact, it might be time to file a lien. It is a powerful tool that can be used for claiming large unpaid sums and should be used as sparingly as possible, as the last course of action.

Filing a lien is a complicated process, one which must be followed carefully. Otherwise, it can result in a countering lawsuit filed for a bad lien, something that no-one with a contractor license in Florida wants to happen. It’s important to avoid the risk of that, so getting professional help is always a good idea.

When you obtain your general contractor license, we at Contractors Reporting Service understand that you want to focus on your job and not on the paperwork. We have the resources to help you if you need legal or administrative aid. You can find us on our website, or feel free to pay us a visit in person for professional help that suits you and your situation best.