In short: It did not work here. A construction lien can be foreclosed against a tenant’s leasehold, but a lien on a Florida liquor license must be recorded with the Division of Alcoholic Beverages and Tobacco within 90 days of its creation to be enforceable against the license. In Solid Builders Construction Co. v. Inka Foods, a contractor tried to reach a liquor license that a later buyer had purchased, lost on summary judgment, and the Third District affirmed without a written opinion on June 18, 2014.
The Facts
Solid Builders Construction Co. did build-out work on a Miami-Dade restaurant and bar for a tenant. The landlord had recorded a notice about the lease, and the lease said the premises would be used as a restaurant and bar serving alcohol. Another lease provision gave the landlord a security interest in any liquor license the tenant later obtained.
Solid Builders was not paid. It recorded a claim of lien, sued, recorded a lis pendens against the tenant’s leasehold, and obtained a default final judgment. It then claimed that its lien reached the tenant’s liquor license. Meanwhile, according to the argument, Hidden Treasure Investments bought the license at a sheriff’s execution sale, and Inka Foods bought it from Hidden Treasure in December 2012 after a lien search with the Division. Solid Builders sued to establish its priority. The trial court granted summary judgment for Inka. The points below are what the lawyers argued, not findings by the court.
- Solid Builders argued that a construction lien can be foreclosed against a leasehold, that the tenant’s leasehold included the liquor license, that its lien related back to the notice of commencement, that it recorded its judgment lien with the Division within 90 days of the judgment, and that the buyers had actual and constructive notice of its claim.
- Inka Foods argued that section 561.65(4) requires anyone claiming a lien on a liquor license to record it with the Division within 90 days of the lien’s creation, that Solid Builders did not do that, and that a buyer who checks the Division’s records should not have to look at construction lien law or drive by job sites.
- Hidden Treasure added that no liquor license existed when the work began, so there was nothing for a construction lien to attach to, and that the landlord never perfected its own security interest in the license.
- The panel asked what “creation” of a lien means under the statute and why the legislature did not say “judgment lien” if that is what it meant.
The Decision
The Third District affirmed on June 18, 2014. The ACIS docket lists the disposition as “Affirmed – Per Curiam Affirmed,” with no written opinion.
Because there is no opinion, the affirmance does not say which ground the court relied on. The summary judgment for Inka stands, but the case is not a published holding on when a construction lien is “created” for purposes of the beverage law.
The Law
Under section 713.10(1), a construction lien extends only to the right, title and interest of the person who contracted for the improvement. When a tenant orders the work, the lien attaches to the tenant’s leasehold, and the landlord’s interest can be protected from those liens under section 713.10(2).
A liquor license is governed by its own statute. Section 561.65(4) says that to perfect a lien or security interest in a spirituous alcoholic beverage license that may be enforced against the license, the lienholder must record it with the Division of Alcoholic Beverages and Tobacco, on the Division’s forms, within 90 days after the date of creation of the lien. An unrecorded lien is not enforceable against the license. Under section 561.65(5), foreclosure of a perfected lien on a license is brought in the circuit court for the county where the license is issued, and the Division is an indispensable party.
The lis pendens statute, section 48.23, sets out what a notice of lis pendens must contain. Inka argued that Solid Builders’ notice did not meet those requirements.
Lessons
- Anyone who takes a lien or security interest in a Florida liquor license should record it with the Division within 90 days. That record is where buyers and lenders look.
- A construction lien on a tenant’s leasehold does not automatically give the contractor a lien on the tenant’s liquor license.
- Landlords who take a security interest in a tenant’s license in the lease still need to perfect it with the Division.
- Buyers of a liquor license should run the Division’s lien search and a judgment search before closing, as Inka did.
- A per curiam affirmance settles this case only. It does not decide the general question of when a lien is “created” under section 561.65.
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.
📑 Can You Foreclose a Construction Lien on a Leasehold? The Appellee's Brief Says Yes
Go Deeper
- Developer's Insiders Bought the Mortgage to Wipe Out the Contractor's Lien (CDC Builders)
- Contractor's Lien Found Late and Fraudulent After a Driveway Dispute (Gregan v. Arencibia)
- Unlicensed Contractor's Lien and a Sanctions Award Reversed (MacAlister v. Bevis)
Frequently Asked Questions
Can a contractor put a lien on a tenant's leasehold in Florida?
Yes. Under section 713.10, a construction lien extends to the interest of the person who ordered the work, so a tenant’s improvements can support a lien on the tenant’s leasehold. The landlord’s interest may be protected depending on the lease and what was recorded.
How do I put a lien on a liquor license in Florida?
Record it with the Division of Alcoholic Beverages and Tobacco on the Division’s forms within 90 days after the lien is created, as section 561.65(4) requires. If you do not, the lien is not enforceable against the license.
Can a contractor's lien reach the liquor license of a restaurant it built out?
Solid Builders tried that theory and lost on summary judgment, and the Third District affirmed without opinion. The buyers argued the contractor never recorded a lien with the Division within the 90-day window.
What should I check before buying a Florida liquor license?
Run the Division’s lien search and a judgment and lien search on the seller, and confirm any recorded liens are released. In this case the buyer relied on those searches and kept the license.
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.
