Sarasota Commercial Refrigeration v. Schooley

Citation: 381 So. 2d 1141Docket: 79-1401, 79-1432

Court: District Court of Appeal of Florida; February 14, 1980; Florida; State Appellate Court

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Sarasota Commercial Refrigeration and Air Conditioning, Inc., along with several other appellants, appealed a final summary judgment favoring appellees Richard W. Schooley and Patricia A. Watts. The judgment was based on Section 713.06(2)(a) of the Florida Statutes, which requires mechanics' lienors to serve a notice to owners of real property to be eligible for a mechanics' lien. The court determined that this statute did not apply to the appellants, and thus reversed the judgment. 

Schooley and Watts owned property in Nokomis, where they contracted Stites Construction to build a Kentucky Fried Chicken store. Stites hired various subcontractors, including the appellants, who completed their work by June 26, 1978. On June 29, 1978, Watts filed an affidavit indicating that Stites had abandoned the contract, listing unpaid lienors, including all appellants. However, none of the appellants filed a timely notice to the owners, and specifically, Sarasota and Ward Curry did not file any notice. Although the appellants filed timely claims of lien in court, the trial court ruled that their failure to serve timely notices to Schooley and Watts barred their claims. The appellate court found that the lower court's reliance on Section 713.06(2)(a) was incorrect and reversed the decision.

Three appellants—Sarasota, Nokomis Septic Tank, Inc., and Venice Fill, Shell, Inc.—sought permission to amend their pleadings to pursue an equitable lien theory, which the trial court denied. The appeals that followed raise the question of whether the applicable statute is Section 713.06(2)(a) from 1977 or the earlier version from 1975. The 1975 statute required lienors (except laborers) to serve a notice to the property owner before perfecting a lien, detailing their name, address, property description, and the nature of services or materials provided. This notice had to be served within 45 days of starting work or before submitting an affidavit, and it did not constitute a lien or notice of any encumbrance.

The 1977 amendment, effective July 1, 1978, retained similar requirements but introduced significant changes, including that subcontractors and materialmen must also serve notice to the contractor and/or subcontractor. Importantly, the amendment established that failure to serve the notice would be a complete defense to payment by any person, except those with whom the lienor had a contract. Prior to this amendment, courts had ruled that failing to serve notice did not bar recovery for materialmen or subcontractors; it only affected their priority status. Relevant case law includes Crane Co. v. Fine, Tuttle/White Constructors, Inc. v. Hughes Supply, Inc., and Bishop v. James A. Knowles, Inc.

Failure to file a timely notice to owner under the new statute precludes all recovery. Statutes are presumed to apply prospectively unless explicitly stated otherwise. Citizens cannot be held accountable for the consequences of legislation prior to its effective date, which was July 1, 1978, in this case. Since the labor and materials were provided before this date and the requisite 45-day notice period had also expired, the amended statute does not apply. Consequently, the appellants may pursue claims under either the Mechanics' Lien Law or an equitable lien theory, rendering the summary judgment improper.

On remand, the trial court's denial of motions to amend complaints for equitable lien recovery by Sarasota, Nokomis, and Venice must be reconsidered. Florida's civil procedure rules favor liberal amendment, especially if sought before a summary judgment hearing and based on the same circumstances as the original claims. However, recovery against the owner is contingent upon the existence of undisbursed or improperly disbursed funds, which the appellants must plead and prove. The final summary judgment is reversed, and the case is remanded for further proceedings consistent with these findings.