In Decks N Such Marine, Inc. v. Daake, the District Court of Appeal of Florida, First District, considered whether a trial court’s award of attorney’s fees to a junior interest holder in a construction lien enforcement action was proper under Section 713.29, Florida Statutes (2018). 2020 WL 2507500 (Fla. 1st Dist. Ct. App. 2020). The Appellate Court found that junior interest holders are not entitled to attorney’s fees as the prevailing party in an action brought to enforce a construction lien.

After Thomas and Adele Daake failed to pay Decks N Such Marine, Inc. (DNS) in full for improvements it made to their home, DNS filed an action in 2006 for enforcement and foreclosure of its construction lien on their property. However, DNS did not file a notice of lis pendens until March 2013. Because the Daakes had previously executed and delivered a mortgage on the property to Bank of America (“BOA”), DNS amended its lien enforcement claim to include BOA.

BOA subsequently filed a Motion for Summary Judgment under Section 713.22, Florida Statutes (2018) based on DNS’ failure to record notice of its lis pendens. After its motion was granted, BOA sought recovery of its attorney’s fees under Section 713.29, Florida Statutes (2018). DNS opposed the award of attorney’s fees, arguing section 713.29 did not support an award of attorney’s fees to BOA because DNS had not attempted to enforce any lien against BOA. In response, BOA argued it was a “prevailing party” under the statute and was therefore entitled to attorney’s fees. The trial court agreed, finding that BOA was a “prevailing party” and holding that Section 713.29 was not limited to actions solely against owners. DNS appealed.

The District Court of Appeal of Florida, First District, noted that the case presented an issue of first impression in Florida as to whether attorney’s fees could be recovered by a junior interest holder in a construction lien enforcement and foreclosure action pursuant to section 713.29. DNS argued the term “prevailing party” found within the statute should be strictly interpreted in a way that would not include junior interest holders. The appellate court agreed. It noted that BOA’s proposed interpretation of the statute would broaden the phrase “in any action to enforce a lien” to mean any litigated matter relating to or arising from the underlying construction lien enforcement action. Such a broad interpretation would conflict with Florida’s adherence to strict construction principles of interpretation for statutes granting attorney’s fees.

The appellate court ultimately found DNS’ purpose in joining BOA in the underlying enforcement action was to ensure determination of superiority of liens in the event of a foreclosure sale, not to enforce a construction lien against BOA. Further, BOA was released from the enforcement action at summary judgment. As such, the appellate court held BOA could not be considered “the prevailing party” in the enforcement action and could not be entitled to an award of attorney’s fees under Section 713.29. The appellate court’s decision is important because it prevents junior interest holders from recovering attorney’s fees as “the prevailing party” in lien enforcement actions under Section 713.29.