Using a Florida Notice of Termination

When properly executed and filed, a statutory Notice of Termination operates to terminate a Notice of Commencement.

Under Florida lien law, you must record a Notice of Commencement when a contractor, subcontractor, material provider or laborer starts work on your property. This provides notice to contractors, owners, subcontractors, material men and laborers working on the job who may have potential mechanic's lien claims. A Notice of Commencement becomes ineffective within 90 days after filing if work has not begun, and expires completely one year after filing (unless otherwise stated in the Notice). Sometimes, though, it becomes necessary to terminate the Notice of Commencement before either of these automatic expiration dates occur.

The Notice of Termination document provides notice to all interested parties that the Notice of Commencement is no longer effective. Additionally, a notice of termination contains an affirmation that all lienors have been paid in full. An owner may not record a notice of termination until after the completion of construction, or after construction ceases before its completion and all lienors have been paid in full or pro rata in accordance with FLA. STAT. 713.06(4). The contractor's final affidavit must also be attached to the Notice of Termination.

713.132 outlines the required contents of a notice of termination:
- The same information as the notice of commencement;
- The recording office document book and page reference numbers and date of the notice of commencement;
- A statement of the date as of which the notice of commencement is terminated, which date may not be earlier than 30 days after the notice of termination is recorded;
- A statement specifying that the notice applies to all the real property subject to the notice of commencement or specifying the portion of such real property to which it applies;
- A statement that all lienors have been paid in full; and
- A statement that the owner has, before recording the notice of termination, served a copy of the notice of termination on the contractor and on each lienor who has a direct contract with the owner or who has served a notice to owner. The owner is not required to serve a copy of the notice of termination on any lienor who has executed a waiver and release of lien upon final payment in accordance with 713.20(2).

If an owner or a contractor, by fraud or collusion, knowingly makes any fraudulent statement or affidavit in a notice of termination or any accompanying affidavit, and any lienor suffers damages because of the misleading information, that lienor also has a right of action for any resulting damages. See 713.132(3).

According to 713.132(4), this notice terminates the Notice of Commencement either 30 days after the Notice of Termination is recorded or on the expiration date stated in the recorded Notice of Termination, whichever is later. Because of this provision, a lienor owed money on a project who is served with a Notice of Termination must prepare and record his or her claim of lien prior to the effective date stated within it.

Each case is unique, so contact an attorney with specific questions or for complex situations relating to a notice of termination or anything else about Florida mechanic's liens.

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