Statute of Limitations to Sue on Common Law Payment Bond

In previous postings, I discussed common law payment bonds (or a payment bond that is NOT a statutory payment bond). An action against a common law payment bond has a one-year statute of limitations, but it is a flexible one year period. Florida statute s. 95.11(5)(e) provides that actions shall be commenced within one year:

Except for actions governed by s. 255.05(10), s. 337.18(1), or s. 713.23(1)(e), an action to enforce any claim against a payment bond on which the principal is a contractor, subcontractor, or sub-subcontractor as defined in s. 713.01, for private work as well as public work, from the last furnishing of labor, services, or materials or from the last furnishing of labor, services, or materials by the contractor if the contractor is the principal on a bond on the same construction project, whichever is later.

This means a party can sue a common law payment bond within one year from the latest of: (i) that party’s final furnishing date on the project or (ii) the final furnishing date of the contractor if the “the contractor is the principal on a bond on the same construction project.”  This is why it is a flexible one year statute of limitations.

There really is not any case law interpreting this. However, assume a subcontractor furnishes a payment bond. That bond would be a common law payment bond since there is not any statutory obligation for that subcontractor to furnish a payment bond. If the subcontractor owes money to one of its subcontractors (a sub-subcontractor on the project), then the sub-subcontractor can sue the subcontractor’s common law payment bond within one year from the sub-subcontractor’s final furnishing or, if the general provided the owner a payment bond, within one year from the general contractor’s final furnishing date.

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

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