Can You Lien Marital Property When Only One Spouse Signs A Construction Contract?
Florida has very strong laws that protect property that is owned by a married couple, jointly. That’s called tenancy by the entireties (TBE), and as a general rule, a creditor cannot collect, levy on, or take, assets or property that are owned by a couple, to collect on debt that is owed by one spouse.
So, for example, if the wife owes a debt, and a creditor sues, if the creditor gets a judgment, the creditor could not take any property that is owned by the husband and wife jointly. Tenancies by the Entireties laws get pretty complex, but for construction law purposes, liens are often used to collect unpaid monies.
When One Spouse Contracts
So what if one spouse contracts for construction work, but not the other? Normally, the property can be liened by the contractor for the unpaid work. But could the contractor lien the property if the property is TBE? In other words, does property get the TBE protection where one spouse contracts for construction work?
That did happen in a case, where a wife contracted with a builder to construct a sea wall. The contractor was unpaid, and sued the wife. It sought to foreclose its lien, but to foreclose against property owned by both the husband and the wife—TBE property—even though only the wife had contracted for the construction work performed.
The contractor obtained a judgment, and the husband appealed, alleging he did not contract for the construction, and furthermore, the property that was foreclosed on was protected by TBE.
But there is a law that specifically says that if a spouse contracts for construction for improvements to property, that the other spouse’s interest in the property is also automatically bound (assuming the parties are still living together and not separated).
The non-contracting spouse, to protect his or her interest and avoid a lien against his or her property can file a notice in the public records within 10 days of the contract’s signing, objecting to the contract. The notice doesn’t have any impact on the contract itself, but which will protect the non-contracting spouse’s interest in property and avoid a lien for nonpayment.
Liens Only – Not Money
Note that even if the non-contracting spouse’s interest in property can be reached and bound by a construction lien, the non-contracting spouse can never be liable for monetary damages for nonpayment. To collect money for nonpayment, only the spouse who signed the contract can be sued.
Still, the law gives contractors a powerful weapon they otherwise wouldn’t have—the ability to lien property owned by a married couple, even when both did not sign the construction contracts.
Serve Both Spouses
In any suit to collect or foreclose on a lien against a husband and wife, both should also be served with notice of the lawsuit, in the event that any property that is owned by the non-contracting spouse will be foreclosed on.
Call our Fort Lauderdale construction attorneys at Sweeney Law P.A. at 954 440-3993 for help today if you haven’t been paid for any construction law project.