How to Negotiate a Florida Construction Lien Before Litigation

If You’ve Filed a Lien, Your Next Move Matters

You filed the claim of lien. Now what?

Before you head to court and spend thousands on attorneys, consider a more strategic option: negotiation.

At Bachara Construction Law Group, we help Florida contractors, subcontractors, and suppliers recover what they are owed while minimizing legal costs. In this post, we break down how to use a lien as leverage to settle before litigation ever begins.

This advice comes straight from construction attorneys Chip Bachara and Hugh Higgins, who share what works, when to act, and how to avoid common pitfalls.

Serve the Lien with a Demand Letter

Once you file your lien, Florida law requires that you serve it on the property owner. That creates the perfect opportunity to also deliver a demand letter.

The demand letter should make it clear that:

• A lien has been recorded against the property
  
• The owner can no longer refinance or sell the property until it is resolved
  
• Attorney’s fees are recoverable under the lien statute
  
• Settling now will minimize the financial burden for all parties

The sooner you send the demand letter, the better. Sophisticated owners who understand the risk may choose to settle quickly, especially if they are not disputing the quality of the work provided.

Even if a dispute exists, sending the letter early helps frame the negotiation and can become useful later in litigation if needed.

Use Attorney’s Fee Recovery as Leverage

In most types of litigation, each side pays its own legal fees. That is known as the American Rule.

However, Florida’s construction lien law makes an exception. Under the statute, the prevailing party is entitled to recover reasonable attorney’s fees from the losing party. This applies to both contractors and owners.

This rule can be a major factor in driving early settlement. For example, if a contractor files a claim for $70,000 and the case proceeds to trial, legal fees on both sides can quickly exceed that amount. Most owners would prefer to settle than risk paying both their own and the contractor’s legal costs.

Some Owners Will Not Settle Until Forced To

Some owners simply will not pay unless forced to act. In those cases, litigation becomes part of the negotiation strategy.

Filing the lawsuit often sends a message that the contractor is serious. When the threat of mounting attorney’s fees and distraction becomes real, many owners choose to engage in meaningful settlement discussions. Understanding what motivates the other party is key to knowing when and how to push for resolution.

File the Lien Even If Payment Seems Impossible

What if the owner has gone bankrupt or abandoned the project?

Always file the lien.

In Chip Bachara’s experience, there is almost always a fund of money that surfaces at some point. When that happens, only valid, recorded claims of lien are considered. If you fail to file or make a mistake on the lien, the amount owed to you may effectively become zero.

Owners, banks, or bankruptcy courts often prioritize payment to valid lienholders. Filing the lien is how you secure your place in line.

You Want to Be a Secured Creditor

If the owner ends up in bankruptcy, having a valid lien may allow you to become a secured creditor. That status is far more favorable than being an unsecured creditor, who is last to be paid and often receives pennies on the dollar.

To get there, you will need to work with an attorney familiar with both construction lien law and bankruptcy proceedings. There are extra steps involved, but the outcome can make a major difference in how much you recover.

Be Prepared for Owner Pushback

Many owners respond to a lien by challenging the amount or quality of the work. It is common to see counterclaims that just happen to exceed the amount of the lien.

This is often a negotiation tactic. Some owners routinely claim defect costs that are slightly higher than the lien to offset the financial risk. Be ready for this and involve your attorney early so that your paperwork is accurate and defensible.

If the Lien Gets Transferred to a Bond

An owner may choose to remove the lien from the title of the property by transferring it to a bond. This is usually done to allow for a sale or refinance.

When this happens, your claim is no longer attached to the property. Instead, it becomes a claim against the bond. The good news is your rights continue, but the lawsuit timeline resets. You now have one year from the date of transfer to file a lawsuit against the surety company.

Final Thought: Evaluate Before You Litigate

Florida’s lien law is one of the most complex areas of state law. Mistakes are costly, deadlines are strict, and litigation can escalate quickly.

Before you decide to sue, consult a construction lawyer who will evaluate both the legal and economic sides of your situation. At Bachara Construction Law Group, we talk through these questions with every caller so you can make an informed decision about your next move.

Need Help with a Construction Lien?

If you are dealing with unpaid work, a difficult owner, or a stalled project, don’t wait.

Our team is here to help you protect your lien rights, negotiate effectively, and recover what you are owed.

Contact us today to discuss your options and get back on track.