What you need to know:
- Where a construction contract itemizes materials, installation, or other costs, a court may find the contract to be “divisible” such that one of the parties may have an enforceable lien for one or more of the items but be in breach as to other items.
- In lien enforcement actions, the party that prevails in the trial court on the “significant issues” will be entitled to recover attorney’s fees. Appellate courts apply the significant issues test, too, and like trial courts may determine that neither or both parties won on significant issues to arrive at a result where neither party may recover attorney’s fees.
In Bauer v. Ready Windows Sales & Service Corporation, 221 So. 3d 761 (Fla. 3rd DCA June 21, 2017) the Owner of a residence in which Ready Windows was contracted to install windows and doors gave a written notice of claim pursuant to § 558.004, Fla. Stat. (2013) identifying defects in Ready Windows’ workmanship. Ready Windows attempted to remedy the defects on several occasions, but Owner claimed the defects were not remedied and withheld final payment.
Ready Windows filed a Complaint to foreclose its construction lien. The trial court found that the contract allocated prices for materials, installation, and permit fees. The court found that Ready Windows had performed with respect to delivery of compliant doors and windows. However, Ready Windows breached with respect to its obligations for installation and therefore was not entitled to payment for that particular contract item.
Owner timely filed an appeal and Ready Windows filed a cross-appeal. The appellate court affirmed the trial court’s rulings. Thus, each of them won on the issue it defended on appeal but each lost on the issue it appealed. Both Owner and Ready Windows filed motions claiming that they had been the prevailing party for appellate attorneys’ fees pursuant to § 713.29, Fla. Stat. (2018). The court applied the “significant issues” test and held that, while (or because) both parties prevailed on the significant issues, neither of them was entitled to recover their appellate attorney’s fees.
The significant issues test recognizes that the court has the discretion to determine which party prevailed on the significant issues of the litigation for the purposes of recovering attorney’s fees under § 713.29. Where both the owner and lienor partially succeed against each other on a lien claim, a court may determine that neither is entitled to recover its attorney’s fees. This bears importantly on the cost-benefit analysis of both trial and a potential appeal. Representation by an attorney experienced in construction lien matters can ensure that you are fully informed to be able to make the best decisions.