Senate Bill sb1048

CODING: Words stricken are deletions; words underlined are additions.
    Florida Senate - 2002                                  SB 1048

    By Senator Posey





    15-384-02

  1                      A bill to be entitled

  2         An act relating to liens; creating the

  3         "Broker's and Appraiser's Lien on Commercial

  4         Real Estate Act"; providing applicability,

  5         definitions, and general provisions; providing

  6         for a commission; specifying persons entitled

  7         to such liens; providing for waiver, release,

  8         or discharge of lien; providing for affidavits

  9         identifying broker; providing for filing and

10         contents of notice of lien; providing for

11         notice of filing; specifying priorities of

12         liens; providing for effect of mixed-use

13         property and changed-in-use property;

14         prescribing time for filing notice of liens;

15         providing for enforcement of liens; providing a

16         statute of limitations; providing for

17         assessment of costs, fees, and interest;

18         providing for release of lien; providing for

19         escrow of disputed matters; providing for a

20         bond to indemnify against a lien; specifying

21         requirements, notice, recording, and actions;

22         providing owner's, tenant's, and broker's

23         remedies; authorizing civil penalties, damages,

24         court costs, and attorney's fees; providing an

25         effective date.

26

27  Be It Enacted by the Legislature of the State of Florida:

28

29         Section 1.  Short title.--This act may be cited as the

30  "Broker's and Appraiser's Lien on Commercial Real Estate Act."

31         Section 2.  Applicability.--

                                  1

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (1)  This act applies only to real estate that is

  2  commercial real estate on the date the notice of lien is filed

  3  under this chapter.

  4         (2)  This act does not apply to:

  5         (a)  A transaction involving a claim for a commission

  6  of $2,500 or less in the aggregate; or

  7         (b)  A transaction for the sale of commercial real

  8  estate involving a claim for a commission of $5,000 or less in

  9  the aggregate if the commercial real estate:

10         1.  Is the principal place of business of the record

11  title owner;

12         2.  Is occupied by more than one and fewer than five

13  tenants; and

14         3.  Is improved with 7,500 square feet or less of total

15  gross building area.

16         Section 3.  Definitions.--In this act, the term:

17         (1)  "Broker" means a person who:

18         (a)  Is licensed as a real estate broker under part I

19  of chapter 475, Florida Statutes; or

20         (b)  Is licensed or certified as a real estate

21  appraiser under part II of chapter 475, Florida Statutes.

22         (2)  "Commercial real estate" means all real estate

23  except:

24         (a)  Real estate improved with one to four residential

25  units;

26         (b)  A single-family residential unit, including a

27  condominium, townhouse, or home in a subdivision, if the unit

28  is sold, leased, or otherwise conveyed on a unit-by-unit basis

29  and regardless of whether the unit is part of a larger

30  building or located on real estate containing more than four

31  residential units;

                                  2

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (c)  Real estate that is or includes on the real estate

  2  a person's homestead;

  3         (d)  Real estate that is not improved with a structure

  4  and is:

  5         1.  Zoned for single-family residential use; or

  6         2.  Restricted for single-family use under restrictive

  7  covenants that will remain in effect for at least the next 2

  8  years; or

  9         (e)  Real estate that:

10         1.  Is primarily used for farming and agricultural

11  purposes;

12         2.  Will continue to be used primarily for farming and

13  agricultural purposes; and

14         3.  Is located more than 3 miles from the corporate

15  boundaries of any municipality.

16         (3)  "Commission" includes a fee or other valuable

17  consideration.

18         (4)  "Commission agreement" means a written instrument

19  that:

20         (a)  Entitles a broker to a commission;

21         (b)  Is signed by the person obligated to pay the

22  commission or that person's authorized agent;

23         (c)  References the commission amount or describes the

24  formula used to determine the commission amount; and

25         (d)  Contains a description legally sufficient for

26  identification of the real estate interest that is the subject

27  of the agreement if the person obligated to pay the commission

28  is a seller or lessor.

29         (5)  "Deferred commission" means a commission that is

30  earned and is not yet payable.

31

                                  3

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (6)  "Real estate" means real estate as defined in

  2  section 475.01, Florida Statutes.

  3         Section 4.  Payable commission and earned commission.--

  4         (1)  A commission is payable at the time provided in

  5  the commission agreement. If payment of the commission is

  6  conditioned on the occurrence of an event and that event does

  7  not occur, the person obligated to pay the commission is not

  8  required to pay the commission.

  9         (2)  Except as provided by subsection (3), a commission

10  is earned on the earlier of the date that:

11         (a)  An event occurs which, under the commission

12  agreement, defines when the commission is earned; or

13         (b)  The person obligated to pay the commission enters

14  into a purchase contract or a lease during the period

15  prescribed by the commission agreement for all or part of the

16  commercial real estate if the purchase contract or lease is

17  contemplated by the commission agreement and if the parties to

18  the purchase contract or lease are contemplated by the

19  commission agreement.

20         (3)  If a broker has earned a commission under a

21  commission agreement relating to a lease transaction and the

22  commission agreement provides that the broker may receive an

23  additional commission when the lease is modified to expand the

24  lease space or renewed, the additional commission is earned

25  when:

26         (a)  The broker performs all the additional services

27  relating to the lease modification or renewal expressly

28  prescribed by the commission agreement; or

29         (b)  The broker first earned a commission under the

30  commission agreement if the commission agreement does not

31

                                  4

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  expressly require the broker to perform additional services

  2  relating to a lease modification or renewal.

  3         Section 5.  Broker's address for receipt of notice.--A

  4  seller, lessor, buyer, or tenant shall send any notice

  5  required to be sent to the broker under this chapter to the

  6  broker:

  7         (1)  At the broker's address as reflected in the

  8  records of the Florida Real Estate Commission; and

  9         (2)  At the broker's last address that the broker

10  furnished the seller, lessor, buyer, or tenant by certified

11  mail, return receipt requested, if the broker's license is

12  expired.

13         Section 6.  Person entitled to lien.--

14         (1)  A broker has a lien on a seller's or lessor's

15  commercial real estate interest in the amount specified by the

16  commission agreement if:

17         (a)  The broker has earned a commission under a

18  commission agreement signed by the seller or lessor of the

19  commercial real estate interest or the seller's or lessor's

20  authorized agent; and

21         (b)  A notice of lien is recorded and indexed as

22  provided by section 714.024, Florida Statutes.

23         (2)  A broker has a lien on the commercial real estate

24  interest purchased by a prospective buyer in the amount

25  specified by the commission agreement if:

26         (a)  The broker has earned a commission under a

27  commission agreement signed by the prospective buyer of the

28  commercial real estate interest or the prospective buyer's

29  authorized agent; and

30         (b)  A notice of lien is recorded and indexed as

31  provided by section 714.024, Florida Statutes.

                                  5

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (3)  A broker has a lien on the leasehold interest in

  2  the commercial real estate that a prospective tenant leases in

  3  the amount specified by the commission agreement if:

  4         (a)  The broker has earned a commission under a

  5  commission agreement signed by the prospective tenant of the

  6  commercial real estate interest or the prospective tenant's

  7  authorized agent; and

  8         (b)  A notice of lien is recorded and indexed as

  9  provided by section 714.024, Florida Statutes.

10         (4)  A lien described by this section is available only

11  to the broker named in the commission agreement. The lien is

12  not available to an employee or independent contractor of the

13  broker.

14         (5)  The broker's right to claim a lien based on the

15  commission agreement must be disclosed in the commission

16  agreement.

17         Section 7.  Waiver, release, or discharge of lien;

18  assumption of commission obligation.--

19         (1)  Except as provided by subsection (2), the waiver

20  of a broker's right to a lien under this part, or a release

21  given for the purpose of releasing the broker's lien before

22  the commission is satisfied or forgiven, is void.

23         (2)  A broker's entitlement to a lien on the interest

24  of an owner or tenant in commercial real estate shall be

25  automatically waived if:

26         (a)  The commission is earned and payable for services

27  provided relating to a lease transaction; and

28         (b)  The commission agreement is included as a

29  provision of the lease agreement.

30         (3)  A lien under this chapter is discharged by:

31         (a)  A court order discharging the lien;

                                  6

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (b)  Paying the commission to the broker named in the

  2  commission agreement; or

  3         (c)  Establishing an escrow account described in this

  4  act.

  5         (4)  A person who assumes an owner's or tenant's

  6  commercial real estate interest is bound by a commission

  7  agreement included in a lease agreement unless an escrow

  8  account is established under this act.

  9         (5)  This section does not affect the rights of a

10  mortgagee who forecloses on commercial real estate and does

11  not assume the lease on which a commission agreement is based.

12         Section 8.  Affidavit identifying broker.--If requested

13  by the buyer, the buyer's authorized agent, or the escrow

14  agent for the commercial real estate transaction, the seller

15  of commercial real estate and the broker representing the

16  seller shall provide to the requesting party before the

17  closing of the transaction a written affidavit identifying

18  each broker with whom the affiant knows or believes the seller

19  or the seller's authorized agent has signed a commission

20  agreement under which a commission is claimed or earned and

21  has not been paid.

22         Section 9.  Filing of notice of lien.--

23         (1)  A broker claiming a lien under this chapter may

24  not file a notice of lien unless the commission on which the

25  lien is based is earned.

26         (2)  A broker claiming a lien under this chapter must

27  file a notice of lien as provided by this act with the clerk

28  of the circuit court of the county in which the commercial

29  real estate is located.

30         (3)  The clerk of the circuit court shall record the

31  notice of lien in records kept for that purpose and shall

                                  7

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  index and cross-index the notice of lien in the names of the

  2  broker, each person obligated to pay the commission under the

  3  commission agreement, and each person who owns an interest in

  4  the commercial real estate if the broker claims a lien on that

  5  interest.

  6         Section 10.  Contents of notice of lien.--The notice of

  7  lien must be signed by the broker or by a person authorized to

  8  sign on behalf of the broker and must contain the following:

  9         (1)  A sworn statement of the nature and amount of the

10  claim, including:

11         (a)  The commission amount or the formula used to

12  determine the commission;

13         (b)  The type of commission at issue, including a

14  deferred commission; and

15         (c)  The month and year in which the commission was

16  earned;

17         (2)  The name of the broker and the real estate license

18  number of the broker;

19         (3)  The name as reflected in the broker's records of

20  any person whom the broker believes is obligated to pay the

21  commission under the commission agreement;

22         (4)  The name as reflected in the broker's records of

23  any person whom the broker believes to be an owner of the

24  commercial real estate interest on which the lien is claimed;

25         (5)  A description legally sufficient for

26  identification of the commercial real estate interest sought

27  to be charged with the lien;

28         (6)  The name of any cooperating broker or principal in

29  the transaction with whom the broker intends to share the

30  commission and the dollar or percentage amount to be shared;

31  and

                                  8

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (7)  A copy of the commission agreement on which the

  2  lien is based.

  3         Section 11.  Notice of filing.--

  4         (1)  In this section, "business day" means a day other

  5  than a Saturday, Sunday, or holiday recognized by this state.

  6         (2)  Not later than 1 business day after the date the

  7  broker files a notice of lien, the broker shall mail a copy of

  8  the notice of lien by certified mail, return receipt

  9  requested, or registered mail to:

10         (a)  The owner of record of the commercial real estate

11  interest on which the lien is claimed or the owner's

12  authorized agent; and

13         (b)  The prospective buyer or tenant and any escrow

14  agent named in a contract for the sale or lease of the

15  commercial real estate interest on which the lien is claimed

16  if:

17         1.  A binding written contract for the sale or lease of

18  the commercial real estate interest is in effect between the

19  owner and the prospective buyer or tenant in a transaction

20  that is the basis for the commission; and

21         2.  The binding written contract was executed by the

22  owner and the prospective buyer or tenant before the date the

23  notice of lien is filed.

24         (3)  Service of the notice under subsection (2) is

25  complete when the notice is deposited in the United States

26  mail, postage prepaid, and addressed to the persons entitled

27  to receive the notice under this section.

28         (4)  If the broker has actual knowledge of the identity

29  of the escrow agent named in the contract for the sale or

30  lease of the commercial real estate interest on which the

31  broker claims a lien or of the escrow agent otherwise closing

                                  9

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  the sale or lease of the commercial real estate interest, the

  2  broker, before the first business day before the date that the

  3  sale or lease is closed on commercial real estate for which a

  4  notice of lien is filed, shall deliver a file-stamped copy or

  5  transmit a facsimile of a file-stamped copy of the notice of

  6  lien to each escrow agent at the office in which the closing

  7  of the sale or lease will occur for use during the closing of

  8  the sale or lease. The broker shall deliver the copy or

  9  transmit the facsimile directly to the individual escrow agent

10  responsible for closing the sale or lease if the broker knows

11  that person's name.

12         (5)  If the escrow agent receives the notice of lien,

13  the escrow agent and other parties to the sale or lease may

14  not close the transaction unless the lien is released, the

15  prospective buyer or tenant purchases or leases the property

16  subject to the lien, the funds are held in escrow, or a bond

17  is filed as provided by this act.

18         (6)  If the broker fails to comply with this section,

19  the notice of lien is void.

20         Section 12.  Inception of broker's lien.--

21         (1)  A broker's lien attaches to the commercial real

22  estate interest owned by the person obligated to pay the

23  commission on the date the notice of lien is recorded as

24  provided by this act. The lien does not relate back to the

25  date of the commission agreement.

26         (2)  A notice of lien for amounts earned by the broker

27  under an installment contract or under a commission agreement

28  for a deferred commission is enforceable only to the extent

29  that the installment or commission has become payable.

30         Section 13.  Priority.--

31

                                  10

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (1)  A recorded lien, mortgage, or other encumbrance on

  2  commercial real estate, including a recorded lien securing

  3  revolving credit and future advances for a loan, recorded

  4  before the date a broker's lien is recorded has priority over

  5  the broker's lien.

  6         (2)  A broker's lien on the commercial real estate

  7  interest of a person obligated to pay a commission is not

  8  valid or enforceable against a grantee, buyer, lessee, or

  9  transferee of the interest of the person obligated to pay the

10  commission if the deed, lease, or instrument transferring the

11  interest is recorded before the notice of the broker's lien is

12  recorded.

13         (3)  A purchase-money mortgage lien executed by the

14  buyer of the commercial real estate interest has priority over

15  a broker's lien claimed for the commission owed by the buyer

16  against the commercial real estate interest purchased by the

17  buyer.

18         (4)  A mechanic's lien that is recorded after a

19  broker's lien and that relates back to a date before the date

20  the broker's lien is recorded has priority over the broker's

21  lien.

22         Section 14.  Mixed-use real estate.--If real estate is

23  zoned or restricted for more than one use, the broker's lien

24  attaches only to the portions of the real estate which

25  constitute commercial real estate.

26         Section 15.  Change in use of real estate.--

27         (1)  Except as provided by subsection (2), any change

28  in the use of the real estate does not affect a broker's lien

29  if the notice of the lien was filed when the real estate was

30  commercial real estate.

31         (2)  The broker's lien is extinguished if:

                                  11

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (a)  Not later than the 360th day after the date on

  2  which the broker's commission is payable, the commercial real

  3  estate interest on which a broker claims a lien is zoned for

  4  single-family use or restricted for single-family use under

  5  recorded restrictive covenants; and

  6         (b)  The zoning ordinances or restrictive covenants for

  7  single-family use are in effect until at least the second

  8  anniversary of the date the commission is payable.

  9         Section 16.  Time to file.--

10         (1)  If a broker has earned a commission under a

11  commission agreement signed by a seller or the seller's

12  authorized agent, a broker must record a notice of lien:

13         (a)  After the commission is earned; and

14         (b)  Before the conveyance of the commercial real

15  estate interest on which the broker is claiming a lien.

16         (2)  If a broker has earned a commission under a

17  commission agreement signed by a prospective buyer or a

18  prospective buyer's authorized agent, the broker must record a

19  notice of lien:

20         (a)  After the buyer acquires legal title to the

21  commercial real estate interest on which the broker is

22  claiming a lien; and

23         (b)  Before the buyer conveys the buyer's commercial

24  real estate interest on which the broker is claiming a lien.

25         (3)  If the lien is based on a lease transaction, the

26  broker must record a notice of lien after the commission is

27  earned and before the earlier of:

28         (a)  The 91st day after the date the event for which

29  the commission becomes payable occurs; or

30         (b)  The date the person obligated to pay the

31  commission records a subsequent conveyance of that person's

                                  12

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  commerical real estate interest after executing the lease

  2  agreement relating to the lease transaction for which the lien

  3  is claimed.

  4         (4)  If a notice of lien is not filed within the time

  5  required by this section, the lien is void.

  6         Section 17.  Suit to foreclose lien.--

  7         (1)  A broker may not bring a suit to foreclose a lien

  8  under this act unless the commission is earned and payable. A

  9  broker may bring a suit to foreclose a lien in any circuit

10  court for the county in which the commercial real estate is

11  located by filing a sworn complaint stating that the notice of

12  lien has been recorded.

13         (2)  A complaint in a suit filed under this section

14  must contain:

15         (a)  A brief description of the commission agreement

16  that is the basis for the lien, including:

17         1.  A description of the disclosure of the broker's

18  right to the lien contained in the commission agreement;

19         2.  The date on which the commission agreement was

20  executed;

21         3.  The event for which a commission is considered to

22  be earned; and

23         4.  The event for which a commission is considered to

24  be payable;

25         (b)  A description of the services performed by the

26  broker;

27         (c)  The amount of the payable commission that is

28  unpaid;

29         (d)  A description of the commercial real estate to

30  which the lien attaches; and

31

                                  13

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (e)  Other facts necessary for a full understanding of

  2  the rights of the parties.

  3         (3)  The broker must include as a defendant in a suit

  4  brought under this part each person the broker believes to

  5  have an interest in the commercial real estate which is

  6  subordinate to or encumbered by the broker's lien.

  7         (4)  If the broker and a person against whom the broker

  8  claims a commission use alternative dispute resolution

  9  procedures to resolve a dispute concerning entitlement to the

10  broker's commission, the broker's lien remains valid, and any

11  suit to foreclose the lien is stayed until the alternative

12  dispute resolution process is completed.

13         Section 18.  Statute of limitations.--

14         (1)  Except as provided by this section, a broker

15  claiming a lien under this act must bring a suit to foreclose

16  the lien on or before the second anniversary of the date the

17  notice of lien is recorded.

18         (2)  A broker claiming a lien to collect a deferred

19  commission must bring a suit to foreclose the lien on or

20  before the earlier of:

21         (a)  The second anniversary of the date on which the

22  commission is payable; or

23         (b)  The 10th anniversary of the date the lien is

24  recorded or the 10th anniversary of the date the broker

25  records a subsequent notice of the lien as a renewal of the

26  broker's right to the lien, whichever date is later.

27         (3)  A renewal of a notice of lien must state that it

28  is a renewal of the broker's lien and must be recorded after

29  the ninth anniversary after the date the original notice of

30  lien or last renewal notice is recorded and on or before the

31

                                  14

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  10th anniversary of the date the original notice of lien or

  2  last renewal notice is recorded.

  3         (4)  A broker claiming a lien for a commission that is

  4  payable must bring a suit to foreclose the lien not later than

  5  the 30th day after the date the broker receives a written

  6  demand to bring a suit to foreclose the lien from the owner of

  7  the commercial real estate interest on which the lien is

  8  claimed.

  9         (5)  If a suit to foreclose the lien is not brought

10  within the period prescribed by this section, the lien is

11  void.

12         Section 19.  Assessment of costs, fees, and

13  interest.--The prevailing party in a suit brought under this

14  act is entitled to court costs, reasonable attorney's fees,

15  and prejudgment interest from the date the commission becomes

16  payable or the date the damage accrues.

17         Section 20.  Release of lien.--

18         (1)  Not later than the 5th day after the date a broker

19  receives a written request from the owner of a commercial real

20  estate interest on which a lien is claimed, the broker shall

21  furnish to the owner a release of indebtedness and any lien

22  claimed if:

23         (a)  The debt that is the basis for the lien is

24  satisfied; or

25         (b)  The lien is discharged under section 7, rendered

26  void under section 10 or section 17, or extinguished under

27  section 14.

28         (2)  When a condition occurs which would preclude the

29  broker from receiving a commission under the terms of the

30  commission agreement that is the basis for the lien, the

31  broker shall, not later than the 10th day after the date the

                                  15

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  broker receives a written request from the owner of the

  2  commercial real estate interest on which the lien is claimed,

  3  furnish to the owner a release of indebtedness and any lien

  4  claimed.

  5         (3)  Not later than the 10th day after the date a

  6  broker receives a written request for the release of the

  7  broker's lien from the escrow agent responsible for closing

  8  the purchase and sale of a commercial real estate interest on

  9  which the lien is claimed, the broker shall furnish to the

10  escrow agent a release of indebtedness and any lien claimed

11  if:

12         (a)  The commercial real estate interest to which the

13  lien attaches is subject to a contract for purchase and sale;

14         (b)  The release of indebtedness and any lien claimed

15  is conditioned on the closing of the transaction; and

16         (c)  The broker would otherwise be obligated to release

17  the indebtedness and any lien claimed under subsection (1) or

18  subsection (2) on the closing of the transaction.

19         (4)  A release of lien must be in a form that permits

20  the instrument to be recorded.

21         Section 21.  Escrow account.--If a claim for a lien

22  under a recorded notice of lien is not paid or assumed at the

23  closing of a sale, lease, or mortgage of the commercial real

24  estate interest subject to the lien and would prevent the

25  closing of the transaction or conveyance or if a claim for a

26  lien under a recorded notice of lien does not survive the

27  closing, any person named in the notice of lien as obligated

28  to pay the commission shall, on the date of the closing:

29         (1)  Establish an escrow account from any net proceeds

30  of the transaction or conveyance in an amount equal to the

31

                                  16

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1  amount sufficient to satisfy the lien plus 15 percent of that

  2  amount; or

  3         (2)  File a bond to indemnify against the lien as

  4  provided by this act.

  5         Section 22.  Named escrow agent.--If an escrow agent is

  6  named in the contract on which the transaction or conveyance

  7  is based, the escrow account must be established with the

  8  named escrow agent.

  9         Section 23.  Costs of interpleader.--Related costs for

10  any interpleader action may be deducted from the escrow

11  account by the person maintaining the escrow account.

12         Section 24.  Refusal to establish escrow account or

13  bond.--

14         (1)  A party may not refuse to close a transaction

15  because of the requirement to establish an escrow account or

16  bond as provided by section 20 if:

17         (a)  The broker provides a copy of the notice of lien

18  that complies with sections 10 and 11;

19         (b)  Sufficient proceeds will result from the proposed

20  transaction for the payment of the commission and costs of the

21  interpleader; and

22         (c)  The broker executes and delivers a full release of

23  the broker's lien in a recordable form.

24         (2)  A prospective buyer of a commercial real estate

25  interest may not refuse to close the purchase solely because a

26  broker's lien is filed after the date a title commitment or

27  abstract of title relating to the interest is issued if an

28  escrow account is established or a bond is filed as provided

29  by this act.

30         Section 25.  Term of escrow account.--The amount held

31  in escrow must be held in escrow until:

                                  17

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (1)  The rights of the parties claiming the amount in

  2  escrow are determined by a written agreement of the parties, a

  3  court order, or an alternative dispute resolution process

  4  agreed to by the parties;

  5         (2)  The broker's lien is no longer enforceable; or

  6         (3)  The funds are interpled into a circuit court for

  7  the county in which the commercial real estate is located.

  8         Section 26.  Extinguishment of lien upon escrow.--When

  9  the escrow account is established, the broker's lien against

10  the commercial real estate is extinguished and becomes a lien

11  on the proceeds in the escrow account.

12         Section 27.  Bond.--

13         (1)  If a lien is fixed or is attempted to be fixed by

14  a recorded instrument, any person may file a bond to indemnify

15  against the lien.

16         (2)  The bond shall be filed with the clerk of the

17  circuit court of the county in which the commercial real

18  estate subject to the lien is located.

19         Section 28.  Bond requirements.--The bond must:

20         (1)  Describe the commercial real estate on which the

21  lien is claimed;

22         (2)  Refer to the lien claimed in a manner sufficient

23  to identify it;

24         (3)  Be in an amount that is double the amount of the

25  lien referred to in the bond as of the date of execution of

26  the bond by the surety, unless the total amount claimed in the

27  lien exceeds $40,000, in which case the bond must be in an

28  amount that is 1.5 times the amount of the lien;

29         (4)  Be payable to the party claiming the lien;

30         (5)  Be executed by:

31         (a)  The party filing the bond as principal; and

                                  18

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (b)  A corporate surety licensed by this state to

  2  execute the bond as surety;

  3         (6)  Be conditioned substantially so that the principal

  4  and sureties will pay the named obligees or their assignees

  5  the amount that the named obligees would have been entitled to

  6  recover if their claim had been proved to be valid and

  7  enforceable liens on the commercial real estate; and

  8         (7)  Identify the last known mailing address of the

  9  person claiming the lien.

10         Section 29.  Notice of bond.--

11         (1)  After the bond is filed, the clerk of the circuit

12  court shall issue notice of the bond to all named obligees.

13         (2)  A copy of the bond must be attached to the notice.

14         (3)  The notice must be served on each obligee by

15  mailing a copy of the notice and the bond to the obligee by

16  certified mail, return receipt requested, addressed to the

17  claimant at the address stated in the bond for the obligee.

18         Section 30.  Recording of bond and notice.--

19         (1)  The clerk of the circuit court shall record the

20  bond, the notice, and a certificate of mailing in the real

21  property records.

22         (2)  In acquiring an interest in or insuring title to

23  the commercial real estate, a buyer, insurer of title, or

24  lender may rely on and is absolutely protected by the record

25  of the bond and the notice to the same extent as if the lien

26  claimant had filed a release of lien in the real property

27  records.

28         Section 31.  Action on bond.--

29         (1)  A party making or holding a lien claim may not sue

30  on the bond later than the last date on which a person may

31  bring a suit to foreclose the lien under section 17.

                                  19

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (2)  The bond is not exhausted by one action against

  2  it. Each named obligee or assignee of an obligee may maintain

  3  a separate suit on the bond in any district court for the

  4  county in which the commercial real estate is located.

  5         Section 32.  Owner's or tenant's remedies.--

  6         (1)  An owner or tenant may file suit against a broker.

  7         (2)  In an action filed under this section, the court

  8  shall discharge a broker's lien if the broker:

  9         (a)  Failed to mail a copy of the notice of lien within

10  the period prescribed by section 10;

11         (b)  Failed to record the notice of lien within the

12  period prescribed by section 15; or

13         (c)  Failed to release a lien within the period

14  prescribed by section 19.

15         (3)  A broker is liable to an owner or tenant for

16  damages as provided by subsection (4) if:

17         (a)  The broker recorded a lien on the commercial real

18  estate interest of the owner or tenant;

19         (b)  The broker failed to release a lien within the

20  period prescribed by section 19;

21         (c)  The owner, tenant, or escrow agent mailed to the

22  broker by certified mail, return receipt requested, a copy of

23  this section and a notice requesting the broker to release the

24  lien not later than the 10th day after the date the broker

25  receives the notice; and

26         (d)  The broker failed to comply with the owner's,

27  tenant's, or escrow agent's written notice within the

28  prescribed period.

29         (4)  If the court finds that a broker is liable to an

30  owner or tenant under subsection (3), the court may award the

31  owner or tenant:

                                  20

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         (a)  Actual damages, including attorney's fees and

  2  court costs, incurred by the owner or tenant which are

  3  proximately caused by the broker's failure to execute,

  4  acknowledge, and return the subordination agreement or release

  5  the lien; and

  6         (b)  A civil penalty in an amount not to exceed three

  7  times the amount of the claimed commission if the court finds

  8  that the broker acted with gross negligence or acted in bad

  9  faith in violation of part I or part II of chapter 475,

10  Florida Statutes.

11         (5)  This section does not prevent:

12         (a)  A person from filing a complaint with the Florida

13  Real Estate Commission against a broker who fails to comply

14  with this chapter; or

15         (b)  The Florida Real Estate Commission at any time

16  from investigating or initiating a disciplinary proceeding

17  against a broker who fails to comply with this act.

18         Section 33.  Broker's remedies.--

19         (1)  A broker may file suit against an owner or tenant

20  to enforce a commission agreement.

21         (2)  If the court finds that the broker waived the

22  right to file a lien under section 7 and that the owner or

23  tenant violated the commission agreement, the court may award

24  to the broker:

25         (a)  Actual damages, including attorney's fees and

26  court costs, that are proximately caused by the owner's or

27  tenant's failure to comply with the commission agreement; and

28         (b)  A civil penalty in an amount not to exceed three

29  times the amount of the claimed commission if the court finds

30  that the owner or tenant acted with gross negligence or in bad

31  faith.

                                  21

CODING: Words stricken are deletions; words underlined are additions.






    Florida Senate - 2002                                  SB 1048
    15-384-02




  1         Section 34.  This act shall take effect October 1,

  2  2002.

  3

  4            *****************************************

  5                          SENATE SUMMARY

  6    Creates the "Broker's and Appraiser's Lien on Commercial
      Real Estate Act." Provides definitions. Provides for
  7    notice, enforcement, waiver, release, and discharge of
      liens. Provides a statute of limitations. Provides for
  8    assessment of costs, fees, and interest. Provides for
      escrow of disputed matters. Provides for a bond to
  9    indemnify against a lien. Provides owner's, tenant's, and
      broker's remedies. Authorizes civil penalties, damages,
10    court costs, and attorney's fees.

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29

30

31

                                  22

CODING: Words stricken are deletions; words underlined are additions.