Professional Plastering v. Bridgeport-Strasberg
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IN THE DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FIFTH DISTRICT
JANUARY TERM 2005
PROFESSIONAL PLASTERING &
STUCCO, INC.,
Appellant,
v.
Case No. 5D03-2572
BRIDGEPORT-STRASBERG JOINT
VENTURE, ET AL.,
Appellee.
_______________________________________/
Opinion filed January 28, 2005.
Appeal from the Circuit Court
for Seminole County,
Clayton Simmons, Judge.
Phillip C. Dozier, Apopka, for Appellant.
William L. Grant and Earnest DeLoach, Jr.,
of Shutts & Bowen, LLP, Orlando, for
Appellee.
THOMPSON, J.
Professional Plastering & Stucco, Inc. (“Professional Plastering”) appeals the
dismissal of its claim against General Accident Insurance Company of America
(“General Accident”).
Professional Plastering is the subcontractor on a construction project. It sued the
contractor in count one for breach of contract claiming the contractor owed it money for
working on the construction project. In count two, it sued General Accident on a bond
issued in connection with the construction project. Professional Plastering alleged in its
complaint that it was owed $88,387.12 for unpaid labor and materials and sought
payment from General Accident under the bond.
It alleged that the bond was a
common law bond and that the requirements of section 713.23, Florida Statutes, did not
apply. The court ruled that the bond was a statutory bond and dismissed count two.
Under section 713.02(6), Florida Statutes, 1 a property owner may require its
contractor to provide a payment bond as provided in section § 713.23. Receipt of the
payment bond exempts the property from lien claims by subcontractors. § 713.23(6),
Fla. Stat.; Corp. of the President of the Latter Day Church of Jesus Christ v. Seymour
Elec. Supply Co., Inc., 558 So. 2d 88 (Fla. 1st DCA 1990). Under the statute, the bond
must be: (1) furnished before "commencing the construction of the improvement under
the direct contract;" (2) in an amount at least the contract price; (3) executed by a surety
authorized to do business in this state; and (4) "conditioned that the contractor shall
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Section 713.23 (1)(a) provides:
(1)(a) The payment bond required to exempt an owner under
this part shall be furnished by the contractor in at least the
amount of the original contract price before commencing the
construction of the improvement under the direct contract,
and a copy of the bond shall be attached to the notice of
commencement when the notice of commencement is
recorded. The bond shall be executed as surety by a surety
insurer authorized to do business in this state and shall be
conditioned that the contractor shall promptly make
payments for labor, services, and material to all lienors
under the contractor's direct contract. Any form of bond
given by a contractor conditioned to pay for labor, services,
and material used to improve real property shall be deemed
to include the condition of this subsection.
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promptly make payments for labor, services, and material to all lienors under the
contractor's direct contract." Thus, if an owner obtains a payment bond, the owner's
property is exempt from mechanics' liens, and the subcontractors are protected by the
payment bond.
The statute also imposes notice and time requirements. A copy of the bond must
be attached to the notice of commencement when it is recorded. § 713.23(1)(a), Fla.
Stat. A subcontractor must give notice that it is relying on the bond for protection by
giving notice to the contractor before or within 45 days of beginning to furnish labor,
materials, or supplies. § 713.23 (1)(c), Fla. Stat. As a condition precedent to recovery
under the bond, the subcontractor must serve written notice of nonpayment to the
contractor and the surety not later than 90 days after it finally furnishes labor, services,
or materials. § 713.23 (1)(d), Fla. Stat. A subcontractor may not institute suit against
the contractor or surety unless the subcontractor has given both notices. § 713.23
(1)(e), Fla. Stat. A subcontractor has one year after completing its work within which to
bring an action on the bond. Id.
In the instant case, there were two alleged deviations from the statutory scheme.
First, work began on the site before the bond was provided. Professional Plastering
asserts that this is contrary to the statute’s requirement that the bond must be furnished
before "commencing the construction of the improvement under the direct contract."
The record shows that a subcontractor’s preparation of the site included the demolition
of houses, stables, a pool, sheds and miscellaneous items, and the removal of mobile
homes.
Second, Professional Plastering allegedly did not provide a notice of
nonpayment. Because Professional Plastering did not provide a notice of nonpayment,
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General Accident contends that it is not required to perform under the bond.
Professional Plastering responds that it was not required to give notice because
General Accident’s failure to issue the bond before work began on the site renders the
bond a common law bond rather than a statutory bond.
Florida law is clear that a payment bond is a common law bond rather than a
statutory bond if it provides more expansive coverage than that provided for in section
713.23. Nat’l Fire Ins. Co. of Hartford v. L.J. Clark Const. Co., 579 So. 2d 743, 744
(Fla. 4th DCA 1991) (citing Standard Heating Ser., Inc. v. Guymann Constr., Inc., 459
So. 2d 1103, 1105 (Fla. 2d DCA 1984)). See also Martin Paving Co. v. United Pacific
Ins. Co., 646 So. 2d 268 (Fla. 5th DCA 1994) (discussing section 255.05, Florida
Statutes, and holding that “the term ‘common law bond’ still means, as it always has
meant, a bond whose protections exceed the minimum obligations imposed by
statute.”). Since there is no showing or allegation in the instant case that the bond
issued by General Accident provided more expansive coverage than is provided for in
the statute, it cannot be considered a common law bond. Compare Nat’l Fire Ins., 579
So. 2d at 745 (holding that bond’s lack of requirement that contractor be given notice
did not render bond common law bond because coverage was not expanded).
Furthermore, even if the bond in the instant case can be deemed a common law
bond, it contains a notice requirement that binds Professional Plastering. Paragraph 3
of the bond provides:
No suit or action shall be commenced hereunder by any
claimants:
a) Unless claimant, other than one having a direct
contract with the Principal [i.e. the contractor] shall have
given written notice to any two of the following: the Principal,
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the Owner, or the Surety above named, within ninety (90)
days after claimant and or performed the last of the work or
labor
The bond defines a "claimant" in paragraph 1 as “one having a direct contract with the
Principal [i.e. the contractor] or with a subcontractor of the principal for labor, material,
or both, used or reasonably required for use in the performance of the contract . . . .”
Generally, common law bonds are governed by their own terms. See Martin Paving
Co., 646 So. 2d 268 (holding that a bond, which lacks the time restrictions of section
220.05 governing public construction projects, is a common law bond and is governed
by its own terms). An exception is when the terms are against public policy. See W.F.
Thompson & Constr. Co. v. Southeastern Palm Beach County Hosp. Dist., 174 So. 2d
410 (Fla. 3d DCA 1965) (holding in context of section 255.05 that one-year limitations
period set in the bond was against public policy, but that 90-day notice provision was
enforceable). In the instant case, because the bond had an enforceable 90-day notice
provision, Professional Plastering was bound by it.
Professional Plastering also argues that the court should not have dismissed its
complaint with prejudice. The order dismissing count two states that the bond in issue
was "a statutory bond in accordance with section 713.23."
The order goes on to
explain:
This ruling is limited to the foregoing, and is not based on
issues of whether notices were required, were given, or were
timely given by the Plaintiff in accordance with the
requirements of Section 713.23 or other applicable
provisions of the Florida Statutes.
Thus, the use of the term “with prejudice” may have been inadvertent. In any case, we
reverse the order on appeal because Professional Plastering may be able to amend its
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complaint to make a sustainable claim against General Accident. See Yun Enters., Ltd.
v. Graziani, 840 So. 2d 420 (Fla. 5th DCA 2003) (holding that leave to amend shall be
freely granted).
REVERSED.
SHARP, W. and MONACO, JJ., concur.
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