Payment bonds · Claims and enforcement
Payment Bond Claims
A bond claim can be the payment remedy when a lien is not available.
A payment bond is a source of payment protection for contractors, subcontractors, suppliers, and others who furnish labor, services, or materials to a construction project. On some projects, the payment bond may be the primary remedy if a construction participant is not paid.
Payment bond claims are common on both private and public projects. The first step is identifying the project type and bond type. A private project may involve a private payment bond. A Florida public project may involve Florida Little Miller Act. An FDOT project may involve FDOT Bond Claims. A federal project may involve Federal Miller Act.
The bond claim process shares similarities with construction lien practice, but it involves different documents and deadlines. For example, a Notice to Contractor serves a role similar to a Notice to Owner, putting the bonded contractor and surety on notice of the claimant’s involvement in the project. Likewise, a Notice of Nonpayment serves a role similar to a Claim of Lien, asserting a claim for unpaid work against the bond rather than against the property.
Timing differences are also important. For many bond claims, the deadline to file a lawsuit runs from the date of final furnishing, not from the date a Notice of Nonpayment is served. This differs from lien practice and can result in a shorter timeframe to take legal action.
The bond claim process typically requires reviewing the bond, contract documents, payment applications, invoices, Change Orders, notices, and deadline history. Missing a bond claim deadline can be just as damaging as missing a lien deadline.
Payment bond disputes often arise from unpaid contract balances, retainage, disputed Change Orders, project delay issues, defective work defenses, termination, or downstream subcontractor and supplier claims.
Montesino Law assists clients with evaluating, preparing, pursuing, and defending payment bond claims throughout Florida.
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Questions About Private Payment Bond Claims in Florida
Private payment bond claims can affect payment rights on private construction projects, especially when a bond changes how unpaid contractors, subcontractors, and suppliers pursue recovery.
What is a private payment bond claim?
A private payment bond claim is a claim against a payment bond on a private construction project. The bond may provide a source of payment for unpaid labor, services, or materials furnished to the project.
How is a private payment bond claim different from a construction lien?
A construction lien is a claim against the improved real property. A private payment bond claim is a claim against the bond principal and surety. Depending on the project and bond, the bond may replace lien rights or transfer the payment fight away from a recorded lien and onto the bond.
Can a subcontractor or supplier make a claim against a private payment bond?
A subcontractor or supplier may be able to make a private payment bond claim if the bond covers the work or materials at issue and the claimant satisfies the applicable notice, timing, and claim requirements. The analysis depends on the bond language, the contract chain, and the project facts.
Do private payment bond claims have deadlines?
Yes. Private payment bond claims can involve notice deadlines, claim deadlines, and lawsuit deadlines. These deadlines should be evaluated separately from construction lien deadlines because the rules may be different.
What is a Florida Notice of Nonpayment?
For a section 713.23 payment bond, a Notice of Nonpayment is a sworn notice asserting the unpaid claim. It is served on the contractor, with a copy to the surety, generally within 90 days after final furnishing. Retainage and late-recorded bonds have special rules.
What is a Florida Notice of Bond?
A Notice of Bond under section 713.23(2) identifies a payment bond securing an already-recorded lien. It is different from the claimant’s Notice of Nonpayment. The Notice of Bond includes a copy of the payment bond and informs the lienor that the claim must be pursued against the bond rather than the property.
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