Venue Considerations in Construction Disputes

When there’s a problem with a construction project, it’s important to think about where any legal action should take place. Most of the time, the place where a lawsuit can be brought is determined by a law called the general venue statute. There are also specific rules about where construction disputes can be heard, which might override the general rules. In Florida, there’s a law that says construction disputes involving work done in the state have to be heard in Florida courts. This means the first thing a lawyer should do in a construction case is figure out if it has to be in Florida. In Florida, if you have a dispute about a construction project, any contract clause that says you have to file a lawsuit in another state is not allowed. The lawsuit has to be in Florida, unless both parties agree to a different location. This rule applies to certain people involved in the construction, like contractors and subcontractors. If they’re involved, the lawsuit has to be in Florida. If they’re not involved, the lawsuit can possibly be in a different state. In a Florida court case, a subcontractor sued a contractor for breaking their agreement. The subcontract had a clause saying any disputes would be settled in Kentucky. The court said that clause doesn’t count because Florida law applies to where the lawsuit has to happen. But, the subcontract can still say that Kentucky law applies to the agreement. In simple terms, the question is whether a contractor who lives outside of Florida can use a Florida law to argue that a lawsuit should be heard in Florida instead of in another state. There isn’t a clear answer to this question, and it may come down to how the law is interpreted. If the contractor can’t use this law, they may have to come up with a different argument to have the lawsuit heard in Florida. In Florida, contractual venue provisions are generally enforceable. There are two types of venue provisions: mandatory and permissive. Mandatory venue provisions use words like “shall” or “must,” and require disputes to be brought in a specific court. Permissive venue provisions don’t specify a particular court and give the party bringing the claim the option to choose the venue, as long as it’s related to the contract. If there’s any confusion about the venue provision, the general venue rules in Florida would apply. If you want to file a claim to get paid for work you did on a construction project, it’s important to do it in the right place. The law says that construction liens have to be filed in the county where the work was done, no matter what the contract says. If you want to take legal action to get paid for the work, you have to do it in the county where the property is located. This was confirmed in a court case called VL Orlando Building Corp. v. A.G.D. Hospitality. The court said that other courts can hear the case, but only the court in the county where the property is can make a decision about the property itself. If a contract says a lawsuit has to happen in a different county, a court can still decide to have the lawsuit in the county where the property is. This is because the lawsuit is about the property itself. The person suing should look at the claims and contract to decide which county is best for the lawsuit. If the contract says the lawsuit has to be somewhere else, there might end up being two separate lawsuits in two different counties for the same thing. This can get even more confusing if the person suing has a contract with the property owner. Even if the contract says the lawsuit has to be somewhere else, the court might still decide to have it in the county where the property is. Not all construction disputes involve property liens. Sometimes, the owner will move the lien from the property to a bond. The owner might also make the contractor get a bond to protect the property from liens. In these cases, the person with the lien can’t sue the property, but can sue the bond instead. A subcontractor filed a lawsuit against a contractor for not paying them for work on a project in Broward County. The subcontractor transferred their claim to a payment bond. The contractor wanted the lawsuit to be moved to Dade County based on the contract but the court said that the lawsuit should stay in Broward County because of a law about payment bonds. They didn’t want the lawsuit to be split into separate lawsuits in different counties. In this case, a material supplier filed a construction lien in Palm Beach County, but the contractor transferred the lien to a payment bond. The material supplier then brought a lawsuit in Broward County. The court said the lawsuit should have been filed in Palm Beach County because that’s where the bond was posted. This is a reminder that legal rules about where a lawsuit should be filed are important, even if there is a contract saying something else. In one case, a subcontractor tried to move a construction dispute to a different county, but the court said no because the bond and contract claims were separate and the bond had to follow certain rules. But in another case, a contractor was able to move a dispute to a different county based on a venue clause in the contract, and the court said that the contract’s rules were more important than the bond rules. If a subcontractor wants to avoid the venue provision in the subcontract, they can file a lawsuit against the surety instead of the contractor. In a specific case, the subcontractor filed a lawsuit in Leon County, but the surety wanted to move the case to Lake County based on the venue provision in the subcontract. However, the court refused to move the case because the surety’s bond allowed the lawsuit to be brought in the county where the construction was happening. The court also said that when a contract involves paying money and doesn’t specify a place for payment, the payment is due where the person owed the money lives. In this case, the surety bond specified Leon County as the venue, so the court didn’t allow the venue to be changed. If you want to change the location of a legal case, you need to bring it up right away in your first response to the complaint. You can’t wait, or else you might lose the right to move the case. You have to file a special motion to transfer the case to a different venue, and you should include the specific contract provision about venue in the motion. If the court agrees to transfer the case, the party who started the case has to make sure it actually gets moved to the new location within 30 days, or else the case might be dismissed. If the case gets dismissed, it could affect time limits for other legal actions related to the case. In construction disputes, where you can go to resolve the issues depends on Florida laws and the specific terms of your contract. You need to make sure you follow the rules so that you don’t lose out on the benefits you agreed to in your contract. It’s important to pay attention to where the dispute needs to be resolved and to follow the rules carefully. A “contractor” is a person who signs a contract with the owner of a property to make improvements. A “subcontractor” is someone who signs a contract with the contractor to do part of the work. A “sub-subcontractor” is someone who signs a contract with the subcontractor to do part of their work. A “materialman” is someone who supplies materials for the project. If you’re working with an out-of-state contractor, make sure they are licensed to work in Florida. Cases like Kerr Construction, Inc. v. Peters Contracting, Inc. and Quality Concrete and Rental, Inc. v. K.A. Lumber Company, Inc. show how issues can arise in construction contracts.

Source: https://www.floridabar.org/the-florida-bar-journal/venue-considerations-in-construction-disputes/