Landlord protection against construction lien claims for tenant improvements
A common, but easily preventable, occurrence for many commercial property owners is having a mechanic's lien filed against their property when their tenant has not paid its contractor and/or their tenant's contractor has failed to pay one of its suppliers, subcontractors or laborers for improvements made to the property by the tenant.
The mechanics lien is a cloud on the property's title and can prevent the sale or refinancing of the property until the mechanic's lien is paid. Often a mechanic's lien for tenant improvements is discovered long after same has been filed in the public records, but by taking a few proactive measures landlord's can ensure that their properties will be protected from the burdens imposed by such mechanic's liens.
Florida Statutes §713.10 provides a landlord with absolute protection from mechanic's liens arising from tenant improvements when the landlord: (i) expressly provides in its lease that that there may be no liens against the landlord's interest in the property for tenant improvements; and (ii) records, in the clerk's office in the county where the property is located, the lease, or a memorandum of the lease, which contains the prohibi