A Florida court recently ruled on a significant case involving attorney's fees in construction lien disputes. In the case of Decks N Such Marine, Inc. v. Thomas O. Daake Sr. and Adele Z. Daake, the court reversed a previous decision that awarded attorney's fees to Bank of America (BOA), a junior interest holder. This decision affects how attorney's fees are awarded in construction lien cases, particularly regarding the rights of junior interest holders.
The case arose from a home renovation project that went wrong. Decks N Such Marine, Inc. (DNS) performed work on the Daakes' home but did not receive full payment. In 2006, DNS filed a lawsuit to enforce a construction lien against the Daakes' property. However, DNS did not file a notice of lis pendens until March 2013, which was seven years after the Daakes had taken out a mortgage with BOA. This delay led to complications in the case.
In 2013, DNS amended its claim to include BOA due to its interest in the property. However, BOA successfully argued for summary judgment, claiming that DNS's late filing of the lis pendens invalidated its lien. Following this, BOA requested attorney's fees under section 713.29 of the Florida Statutes, which allows the prevailing party in a lien enforcement action to recover fees.
At the hearing for attorney's fees, DNS contended that section 713.29 did not apply to BOA, as it was a junior interest holder and not the property owner or contractor. DNS argued that the statute only allowed for attorney's fees between the contractor and the property owner. BOA countered that it was a prevailing party in the action and thus entitled to fees.
The trial court sided with BOA, stating that the action was to foreclose against BOA's interest in the property and that the statute did not limit attorney's fees to actions against owners. This decision led DNS to appeal the ruling.
The court's ruling focused on the interpretation of section 713.29. The court stated, "The statutory language—'in any action brought to enforce a lien...the prevailing party is entitled to recover a reasonable fee'—unambiguously restricts a fee award to the prevailing party in the action to enforce the lien." The judges involved in the ruling were M.K. Thomas, Chief Judge Ray, and Judge Lewis.
Ultimately, the court concluded that junior interest holders, like BOA, are not entitled to attorney's fees in lien enforcement actions. The court emphasized that allowing such awards would disrupt the balance of interests established by Florida law. The ruling clarified that the term "prevailing party" in section 713.29 specifically refers to the party that prevails in the action to enforce the lien, not to other parties involved in the litigation.
This ruling has significant implications for future construction lien cases in Florida. It establishes that junior interest holders cannot claim attorney's fees simply by being involved in a lien enforcement action. This decision reinforces the principle that attorney's fees statutes should be narrowly construed and only apply to the parties directly involved in enforcing a construction lien.
Looking ahead, this ruling may influence how contractors and suppliers approach lien enforcement actions. They may be more cautious about joining junior interest holders in these cases, knowing that it could complicate their ability to recover attorney's fees. The court's decision also underscores the importance of timely filing notices of lis pendens, as delays can have serious consequences for lien enforcement.
As for the possibility of appeals, the court ruling is not final until any timely motions under Florida Rules of Appellate Procedure are resolved. Therefore, it remains to be seen if BOA will seek further review of this decision or if related cases will emerge as a result of this ruling.