On May 21, 2014, Florida's Second District Court of issued an opinion in Snell v. Mott's Contracting Services, Inc. affecting construction claims of lien and arbitration proceedings. The court examined the question of whether the award of attorneys' fees was proper in an arbitration proceeding pursuant to the Florida's Construction Lien Law.
The court held that Section Fla. Stat. § 713.21(1) requires that an "action to enforce a construction lien must be brought 'in a court of competent jurisdiction' within one year of recording the claim of lien or it automatically extinguishes." Moreover, the Court held that an arbitration proceeding is not a "court." As such, the lien at issue in this case "became unenforceable pursuant to section 713.22 prior to the issuance of the [arbitration] award" due to the contractor's failure to file an enforcement action in court within a year.
Given the holding in Snell, it is likely advisable for lien holders to file an action in a court of competent jurisdiction within a year, even if the action is stayed during an arbitration proceeding. Otherwise, lienholders may have difficulty recovering fees or even enforcing a lien to the extent that enforcement in the arbitration proceeding is not complete within year.
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