In short: No: a contractor that has already been paid for work cannot recover the same amount again from another owner on the project. In Tern Bay Community Development District v. Ryangolf Corp., the Second District reversed $280,819.77 of a jury verdict against a community development district because the developer had already paid for that work, and it struck execution against district property. The written opinion issued December 31, 2014.
The Facts
Tern Bay was planned in Charlotte County as a residential community with a golf course and amenities. Tern Bay, LLC, the developer, was building the private amenities. The Tern Bay Community Development District, a special district created under chapter 190, was responsible for public infrastructure. In 2004 both entities contracted with Ryangolf Corporation for construction work.
The project was never finished. In December 2007 Ryangolf sued both owners for more than $2 million and recorded a lien. It later dropped the developer, which the opinion describes as apparently insolvent. The district separately foreclosed on the developer’s interest in the property and obtained a judgment in 2010.
At trial Ryangolf sought $389,881.27 from the district: $109,061.50 for additional work done for the district, and $280,819.77 for work it said the district owed but that had been invoiced to the developer by mistake. The jury awarded the full amount. No transcript of the oral argument was available to us, so this summary comes from the opinion.
The Decision
The Second District affirmed in part, reversed in part and remanded on December 31, 2014, in a written opinion.
The $280,819.77 award was reversed. The developer had already paid Ryangolf for that work through the miscoded invoices, so making the district pay again would be a double payment. The court treated the developer as standing in the contractor’s shoes for that debt under the doctrine of equitable subrogation, and it held that the developer’s insolvency did not justify a second recovery.
The court also struck the judgment’s “let execution issue” language, because district property is exempt from execution. The rest of the judgment, including the $109,061.50 for additional work, was affirmed without discussion. The mandate issued January 23, 2015.
The Law
Community development districts are special-purpose local governments created under chapter 190. Under section 190.044, district property is exempt from levy and sale under execution, and a judgment against the district does not become a lien on its property or revenues. That section preserves bondholders’ remedies to enforce liens or pledges the district gave on its bonds.
Equitable subrogation lets a party who paid another’s debt step into the creditor’s position. Here, it meant the payment the developer had already made counted, and the contractor could not collect it again from the district.
On projects with both public and private owners, the opinion shows why billing matters. Invoices coded to the wrong owner led to years of litigation over who paid for what.
Lessons
- A contractor can recover what it is owed once. Payment by one owner can defeat a claim for the same work against another.
- Keep invoices and payment records tied to the right contract and the right owner, especially on public/private projects.
- A money judgment against a community development district cannot be collected by levying on district property.
- If one owner on a project becomes insolvent, that does not shift its paid obligations onto the other owner.
Source: Tern Bay Community Development District v. Ryangolf Corp., No. 2D13-4436 (Fla. 2d DCA Dec. 31, 2014); ACIS docket.
Watch the Oral Argument
This is the recording of the actual oral argument, posted on the channel. What lawyers and judges say at argument is not the ruling; the decision is summarized above.
A Long Construction Contract…400 Pages..Public/Private Contract
Go Deeper
- Can a Noteholder Challenge Improvement District Liens? Appeal Affirmed (Port of the Islands)
- Developer's Insiders Bought the Mortgage to Wipe Out the Contractor's Lien (CDC Builders)
- Oral Change Orders on a Fisher Island Renovation: The Owner Paid, So the Owner Waived (Moscato v. Mutchnik Construction)
Frequently Asked Questions
Can a contractor sue a second owner for work the first owner already paid for?
No. In Tern Bay, the Second District held that making the district pay $280,819.77 for work the developer had already paid for would be a double recovery. The contractor kept the award for work actually owed by the district.
Can you collect a judgment against a community development district by seizing its property?
No. Under section 190.044, district property is exempt from levy and execution, and a judgment does not become a lien on district property or revenues. The court struck the execution language from Ryangolf’s judgment.
What is a community development district in Florida?
A CDD is a special-purpose unit of local government created under chapter 190 to finance and manage infrastructure for a community. In Tern Bay, the district handled public infrastructure while the developer built private amenities.
What happens if a developer goes broke in the middle of a construction project?
The contractor may have claims and lien rights against the owner, but another party on the project does not take over debts the developer already paid. Tern Bay shows courts will look at who actually paid for the work.
Talk to a Florida real estate litigation lawyer
Weidner Law, P.A. handles Florida real estate disputes, title problems and appeals from St. Petersburg. If you need a real estate litigation lawyer, call (727) 954-8752 or email weidner@mattweidnerlaw.com.
Read the law yourself, free: every Florida statute and court rule is on floridarules.net.
This article is general information about Florida law, not legal advice about your situation. Reading it, watching the videos, or contacting the firm does not create an attorney-client relationship. Every case turns on its own facts, and past results do not guarantee a similar outcome. The hiring of a lawyer is an important decision that should not be based solely upon advertisements.
