HB 1277 2003
1	A bill to be entitled
2	An act relating to the enforceability of construction
3	contracts performed by unlicensed contractors; amending
4	ss. 255.05, 489.128, 489.532, and 713.02, F.S.; clarifying
5	that the prohibition on enforcement of construction
6	contracts extends only to enforcement by the unlicensed
7	contractor; clarifying the parties who may invoke
8	unenforceability; clarifying that unlicensed contractors
9	have no construction lien or payment bond rights;
10	clarifying that sureties of unlicensed contractors have
11	continuing payment and performance bond obligations;
12	clarifying the effect of an unenforceable contract on
13	other contracts and obligations; clarifying the definition
14	of an “unlicensed contractor”; limiting statute to state
15	licensure; providing for retroactive effect; providing an
16	effective date.
17
18	Be It Enacted by the Legislature of the State of Florida:
19
20	Section 1. Paragraph (a) of subsection (2) of section
21	255.05, Florida Statutes, is amended to read:
22	255.05 Bond of contractor constructing public buildings;
23	form; action by materialmen.--
24	(2)(a)1. If a claimant is no longer furnishing labor,
25	services, or materials on a project, a contractor or the
26	contractor's agent or attorney may elect to shorten the
27	prescribed time in this paragraph within which an action to
28	enforce any claim against a payment bond provided pursuant to
29	this section may be commenced by recording in the clerk's office
30	a notice in substantially the following form:
31
32
33	NOTICE OF CONTEST OF CLAIM
34	AGAINST PAYMENT BOND
35
36	To: ... (Name and address of claimant) ...
37
38	You are notified that the undersigned contests your notice
39	of nonpayment, dated _______________, __________, and served on
40	the undersigned on _______________, __________, and that the
41	time within which you may file suit to enforce your claim is
42	limited to 60 days after the date of service of this notice.
43
44	DATED on _______________, __________.
45
46	Signed:... (Contractor or Attorney) ...
47
48	The claim of any claimant upon whom such notice is served and
49	who fails to institute a suit to enforce his or her claim
50	against the payment bond within 60 days after service of such
51	notice shall be extinguished automatically. The clerk shall mail
52	a copy of the notice of contest to the claimant at the address
53	shown in the notice of nonpayment or most recent amendment
54	thereto and shall certify to such service on the face of such
55	notice and record the notice. Service is complete upon mailing.
56	2. A claimant, except a laborer, who is not in privity
57	with the contractor shall, before commencing or not later than
58	45 days after commencing to furnish labor, materials, or
59	supplies for the prosecution of the work, furnish the contractor
60	with a notice that he or she intends to look to the bond for
61	protection. A claimant who is not in privity with the contractor
62	and who has not received payment for his or her labor,
63	materials, or supplies shall deliver to the contractor and to
64	the surety written notice of the performance of the labor or
65	delivery of the materials or supplies and of the nonpayment. The
66	notice of nonpayment may be served at any time during the
67	progress of the work or thereafter but not before 45 days after
68	the first furnishing of labor, services, or materials, and not
69	later than 90 days after the final furnishing of the labor,
70	services, or materials by the claimant or, with respect to
71	rental equipment, not later than 90 days after the date that the
72	rental equipment was last on the job site available for use. No
73	action for the labor, materials, or supplies may be instituted
74	against the contractor or the surety unless both notices have
75	been given. Notices required or permitted under this section may
76	be served in accordance with s. 713.18. An action, except for an
77	action exclusively for recovery of retainage, must be instituted
78	against the contractor or the surety on the payment bond or the
79	payment provisions of a combined payment and performance bond
80	within 1 year after the performance of the labor or completion
81	of delivery of the materials or supplies. An action exclusively
82	for recovery of retainage must be instituted against the
83	contractor or the surety within 1 year after the performance of
84	the labor or completion of delivery of the materials or
85	supplies, or within 90 days after receipt of final payment (or
86	the payment estimate containing the owner's final reconciliation
87	of quantities if no further payment is earned and due as a
88	result of deductive adjustments) by the contractor or surety,
89	whichever comes last. A claimant may not waive in advance his or
90	her right to bring an action under the bond against the surety.
91	In any action brought to enforce a claim against a payment bond
92	under this section, the prevailing party is entitled to recover
93	a reasonable fee for the services of his or her attorney for
94	trial and appeal or for arbitration, in an amount to be
95	determined by the court, which fee must be taxed as part of the
96	prevailing party's costs, as allowed in equitable actions. The
97	time periods for service of a notice of nonpayment or for
98	bringing an action against a contractor or a surety shall be
99	measured from the last day of furnishing labor, services, or
100	materials by the claimant and shall not be measured by other
101	standards, such as the issuance of a certificate of occupancy or
102	the issuance of a certificate of substantial completion.
103	3. Notwithstanding any other provision of this section, no
104	bond claim shall exist in favor of any contractor,
105	subcontractor, or sub-subcontractor unless such contractor,
106	subcontractor, or sub-subcontractor is licensed, if required to
107	be licensed, as a contractor pursuant to the license
108	requirements established and governed by chapter 489. Any
109	claimant whose primary or secondary qualifying agent is licensed
110	under chapter 489 has satisfied the licensing provisions of this
111	subparagraph. This subparagraph does not affect the contract or
112	bond claim rights of other parties, other than the unlicensed
113	contractor, receiving or supplying labor, services, or materials
114	to the same project, or the obligations of a surety as defined
115	by part XII of chapter 627, who has provided a bond on behalf of
116	the unlicensed contractor. An occupational license certificate
117	issued under the authority of chapter 205 is not a license for
118	purposes of this subparagraph.
119	Section 2. Section 489.128, Florida Statutes, is amended
120	to read:
121	489.128 Contracts performed by unlicensed contractors
122	unenforceable.--As a matter of public policy, contracts entered
123	into on or after October 1, 1990, and performed in full or in
124	part by any individualcontractor who fails to obtain or
125	maintain a license as required by this part or a business
126	organization contractor who fails to obtain or maintain a
127	primary or secondary qualifying agent’s licensein accordance
128	with this part shall be unenforceable in law or in equity by the
129	unlicensed contractor. An “unlicensed contractor,” for the
130	purpose of this section, is an individual contractor who fails
131	to obtain or maintain a license in accordance with this part or
132	a business organization contractor who fails to obtain or
133	maintain a primary or secondary qualifying agent’s license under
134	this part or engages in contracting as a business organization,
135	including any partnership, corporation, business trust, or other
136	legal entity, and fails to obtain or maintain a certified or
137	registered qualifying agent. A contractor whose primary or
138	secondary qualifying agent is licensed under chapter 489 has
139	satisfied the licensing provisions of this section. This section
140	shall not apply to any other licensing requirements except those
141	specifically established and governed by this chapter. Any
142	business organization contractor that fails to obtain or
143	maintain a qualifying business license or certificate of
144	authority as required by ss. 489.119 or 489.127 shall not be
145	considered an unlicensed contractor for purposes of this
146	section. An occupational license certificate issued under the
147	authority of chapter 205 is not a license for purposes of this
148	section. This section does not affect either the right to
149	enforce contract, lien, or bond remedies of parties other than
150	the unlicensed contractor receiving or supplying labor,
151	services, or materials to the same project, or the obligations
152	of a surety as defined by part XII of chapter 627, who has
153	provided a bond on behalf of the unlicensed contractor. It shall
154	not be a defense to any claim on a payment bond, performance
155	bond, bid bond, or indemnity agreement that the principal on the
156	bond or its indemnitor is an unlicensed contractor.
157	Section 3. Section 489.532, Florida Statutes, is amended
158	to read:
159	489.532 Contracts performed by unlicensed contractors
160	unenforceable.--As a matter of public policy, contracts entered
161	into on or after October 1, 1990, and performed in full or in
162	part by any individual contractor who fails to obtain or
163	maintain a license as required by this part or a business
164	organization contractor who fails to obtain or maintain a
165	primary or secondary qualifying agent’s license in accordance
166	with this part shall be unenforceable in law or in equity by the
167	unlicensed contractor. An “unlicensed contractor," for the
168	purpose of this section, is an individual contractor who fails
169	to obtain or maintain a license in accordance with this part or
170	a business organization contractor who fails to obtain or
171	maintain a primary or secondary qualifying agent’s license under
172	this part or engages in contracting as a business organization,
173	including any partnership, corporation, business trust, or other
174	legal entity, and fails to obtain or maintain a certified or
175	registered qualifying agent. A contractor whose primary or
176	secondary qualifying agent is licensed under chapter 489 has
177	satisfied the licensing provisions of this section. This section
178	shall not apply to any other licensing requirements except those
179	specifically established and governed by this chapter. Any
180	business organization contractor that fails to obtain or
181	maintain a qualifying business license or certificate of
182	authority shall not be considered an unlicensed contractor for
183	purposes of this section. An occupational license certificate
184	issued under the authority of chapter 205 is not a license for
185	purposes of this section. This section does not affect either
186	the right to enforce contract, lien, or bond remedies of parties
187	other than the unlicensed contractor receiving or supplying
188	labor, services, or materials to the same project, or the
189	obligations of a surety, as defined by part XII of chapter 627,
190	who has provided a bond on behalf of the unlicensed contractor.
191	It shall not be a defense to any claim on a payment bond,
192	performance bond, bid bond, or indemnity agreement that the
193	principal on the bond or its indemnitor is an unlicensed
194	contractor who fails to obtain or maintain his or her license in
195	accordance with this part shall be unenforceable in law, and the
196	court in its discretion may extend this provision to equitable
197	remedies.
198	Section 4. Subsection (7) of section 713.02, Florida
199	Statutes, is amended to read:
200	713.02 Types of lienors and exemptions.--
201	(7) Notwithstanding any other provision of this part, no
202	lien shall exist in favor of any contractor, subcontractor, or
203	sub-subcontractor unless such contractor, subcontractor, or sub-
204	subcontractor is licensed, if required to be licensed, as a
205	contractor pursuant to the license requirements established and
206	governed by chapter 489. Any lienor whose primary or secondary
207	qualifying agent is licensed under chapter 489 has satisfied the
208	licensing provisions of this subsection. This subsection does
209	not affect the contract, lien, or bond claim rights of other
210	parties, other than the unlicensed contractor receiving or
211	supplying labor, services, or materials to the same project, or
212	the obligations of a surety as defined by part XII of chapter
213	627 who has provided a bond on behalf of the unlicensed
214	contractor. An occupational license certificate issued under the
215	authority of chapter 205 is not a license for purposes of this
216	subsection laws of the jurisdiction within which she or he is
217	doing business.
218	Section 5. Sections 2, 3, and 4 of this act are intended
219	to be remedial in nature and to clarify existing law. Sections 2
220	and 3 shall apply retroactively to all contracts entered into on
221	or after October 1, 1990. Section 4 shall apply retroactively to
222	all actions initiated on or after, and to all actions pending as
223	of, the effective date of this act.
224	Section 6. If any provision of this act or its application
225	to any person or circumstance is held invalid, the invalidity
226	does not affect other provisions or applications of the act
227	which can be given effect without the invalid provision or
228	application, and to this end the provisions of this act are
229	severable.
230	Section 7. This act shall take effect upon becoming a law.