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HHC-Blog

Understanding Indemnification Clauses

Indemnification clauses can be found in various business contracts, from commercial construction corporations to 1099 gig contractors. Though it’s a common clause in many contracts, it’s the source of confusion for many. Understanding the purpose and elements of indemnification clauses is essential, whether you’ve been asked to sign a contract with an indemnification clause or a business owner looking to protect your business with the same clause. Learn more about what indemnification clauses are below.   

What’s an Indemnification Clause?  

Indemnification clauses are designed to protect or “hold harmless” one party from the liabilities and damages caused by another party. Indemnification clauses free you from the responsibility of paying for damages someone may suffer at your business or job site due to actions by a third party. In business contracts, indemnification clauses specify that a third party (not your business) is responsible for compensating someone due to the actions of another party.  

Purpose of an Indemnification Clause 

The primary purpose of an indemnification clause is to make another party responsible for paying for the losses, damages, and out-of-pocket expenses of defending your business in court if someone should sue your company under specific circumstances. When you indemnify someone, you’re taking on the responsibility to pay for the losses and damages on behalf of another party.  

Examples of Indemnification Clauses 

Here are a few examples of how indemnification clauses work in real-life scenarios:  

  1. A landlord leases a building to a dance studio. The landlord adds an indemnification clause to the leasing contract, which states that the dance studio is responsible for paying for any damages and court costs if someone sues the dance studio after suffering an injury at the facility.  
  1. A wedding venue contracts a DJ. During the festivities, a wedding guest trips on one of the DJ’s power cords and is injured. The wedding guest sues the venue and DJ. Since there was an indemnification clause in the DJ’s contract, the DJ is responsible for reimbursing the wedding venue’s costs of defending themselves in court and the fees for the lawsuit brought against them.  
  1. A business owner hires a commercial contractor to outfit a new office building. During construction, a pipe burst and water spilled on the floor. A customer walked by and slipped and fell. The customer sues the business owner. However, since the business owner included an indemnity clause in their contract, the contractor is responsible for reimbursing the business for the customer’s losses and damages.   

Elements of Indemnification Clauses  

Indemnification clauses should be narrow in scope and specific. Vaguely worded clauses are hard to defend in court. Several elements need to be included to craft an effective indemnification clause. First, language such as “defend,” “hold harmless,” or “indemnify” should be included in the clause. The clause should name the indemnifying party (the person responsible for paying damages) and the indemnified party (the person who suffered the harm or loss). The clause should state specific events and instances that would cause this clause to take effect, along with the maximum compensation a company would receive for out-of-pocket expenses and court fees. The clause should also include types of exclusions and a statute of limitations for when claims can be brought against the indemnifying party.  

Drafting Indemnification Clauses in Business Contracts  

In Florida, indemnification clauses for construction contracts must follow the guidelines stated in Florida Statute 725.06. Indemnification clauses are a highly complex aspect of business contracts, so it’s important to have experienced business attorneys like the ones at The Boutty Law Firm help you draft and review the indemnification clause to ensure its legally enforceable. Call our office at (407) 622-1395 or use our online live chat feature to get started.

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Design-Blog

What is a Design Defect?

Discovering construction defects in a building project can be a frustrating experience for any property owner. These defects can arise from inadequate planning, substandard workmanship, and defective materials. Design defects are a type of construction defect related to a structure’s design and planning. Learn more about design defects and what to do if your home or business structure has a design defect below. 

What is a Design Defect?  

According to Florida Statute 558.002(5), design defects are deficiencies that affect a structure’s functionality, safety, or durability due to the planning, supervision, observation, repair, remodeling, or design specifications. Design defects occur when errors in project planning make the building dysfunctional or dangerous, even though the building is constructed according to the approved plans. If the design defect is caught early, it can sometimes be remedied by redesigning the structure and fixing the problem during construction. However, if the design defect isn’t detected during construction, it can cause serious property damage and injuries to those utilizing the property.  

Types of Design Defects  

There are several common types of design defects that can be easily overlooked during the planning phase of a construction project:  

Inferior Structural Support  

This occurs when the design doesn’t account for the necessary load-bearing requirements, resulting in weak or unstable structures that could break, fall, or collapse.  

Insufficient Lighting 

Personal injuries such as slips and falls can occur in places with low lighting. In some cases, the lighting could be a design flaw, such as not providing enough overhead fluorescent lighting at the entrance of a retail store and not having enough natural light to provide a safe environment for customers and employees.   

Lack of Accessibility  

Buildings must follow a list of requirements to make them accessible to everyone. Narrow doorways, lack of ramps or elevators, and improper placement can be design defects that make the building not ADA compliant, resulting in federal and state penalties that could include a fine of up to $75,000. 

Examples of Design Defects 

Here are a few real-world examples of design defects:  

  • A highway overpass was designed without accounting for the typical height of trucks and construction vehicles. Several trucks collided with the top of the overpass, causing extensive property damage and significant traffic problems. 
  • A new neighborhood was designed with an insufficient stormwater drainage system. Some residents experienced flooding during heavy rain and thunderstorms, causing property damage and dangerous conditions.  
  • A university library was built on a lot of lakefront sandy soil. The building’s design failed to account for the weight of the books located inside the library, and the entire structure began to sink several inches per year.  

Liability for Design Defects For Home and Business Owners  

If you think there’s a design defect in a recently completed project in your newly built home or commercial business, here’s what to do: 

  1. Document the issue. Take pictures and videos, and keep track of your expenses for repair and replacement.  
  1. Review your construction contract and blueprints. Inspect your agreement with your contractor or construction company to review your agreed-upon specifications. You can also see if construction and design defects are addressed in the contract. 
  1. Get a second opinion. Hire another designer or contractor specializing in design assessments to review your project design. They can provide a third-party opinion on whether a design defect may have occurred.  
  1. Speak with a construction attorney. Once you have confirmation about an alleged design defect, contact a legal professional, like our team at the Boutty Law Firm. We will listen to your concerns and help you through the process of receiving compensation for expenses and damage caused to your home or business due to a design defect.  
  1. Notify the designer, contractor, or construction company. You must follow specific requirements to do this, so our attorneys will help you through this process.  
  1. File a claim. You have four years after discovering the defect to file a claim. We will work diligently to help you get the compensation you deserve due to your property’s design defect, whether we use formal mediation methods or take your case to court.  

Experienced Construction Attorneys in Central Florida 

The Boutty Law Firm has over 20 years of experience in the construction industry and has helped clients with numerous construction law cases in Central Florida. We represent residential and commercial property owners and construction companies for all construction law matters. Contact us today to discuss your case and schedule a consultation.  

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formal-blog

Summary vs. Formal Administration: What’s the Difference?

Probate: Navigating the Legal Process of Estate Settlement in Florida 

Probate is a legal process that takes place after the passing of an individual to settle their estate. It involves the closure and distribution of funds from financial accounts, division of personal possessions, handling of creditor claims, and estate valuation. As probate can be time-consuming, understanding your options as a beneficiary or personal representative is crucial. In Florida, there are two primary types of probate: summary administration and formal administration. To make informed decisions, it’s important to comprehend the nuances of each approach. 

Understanding Summary Administration 

Summary administration offers a simplified probate procedure designed for small estates. It is characterized by shorter timeframes and lower costs compared to formal administration. However, this process is only applicable to estates that meet specific criteria, outlined below: 

Qualifications for Summary Administration 

To qualify for summary administration, the estate must satisfy at least one of the following conditions: 

  • The estate’s total value is under $75,000. 
  • The decedent passed away over two years ago. 
  • Creditors are legally prohibited from making claims against the estate. 
  • The decedent’s sole assets are exempt from probate. 
  • The decedent’s sole assets are exempt from creditor claims. 

For detailed eligibility guidelines, refer to Florida Statute 735.021. 

Summary Probate Procedure 

The steps involved in summary administration in Florida are as follows: 

  1. Petition for Summary Administration: Any beneficiary or appointed personal representative can initiate a petition for summary administration during probate proceedings, provided the estate meets the specified criteria. The petition must include documentation verifying the estate’s value, encompassing financial accounts, real property value, and business assets if applicable. 
  1. Creditor Search: To qualify for summary administration, creditors must be unable to file claims against the estate. As part of the petition process, comprehensive documentation demonstrating diligent efforts to identify potential creditors and eliminate valid claim possibilities must be presented. 
  1. Asset Distribution: Upon confirming the estate’s eligibility for summary administration and completing the creditor search, a judge issues the summary administration order, effectively concluding probate. The judge’s order can then be presented to relevant institutions, such as banks and insurance companies, to facilitate the distribution of assets to beneficiaries. 

Formal Administration: A Comprehensive Process 

Formal administration is the predominant probate method, especially for executing a will. The timeline for formal administration typically spans six months to a year or longer, depending on the complexity of the estate. 

Qualifications for Formal Administration 

Formal administration is mandatory for estates with probatable assets exceeding $75,000. This form of probate is also required if the will is contested, even if the estate’s value falls below $75,000. 

Steps of Formal Administration 

The formal probate process in Florida encompasses the following steps: 

  1. Petition of Administration: Formal administration commences when the estate’s personal representative provides necessary documentation, including the death certificate, financial statements, and the will, to a probate attorney. Subsequently, the attorney files a formal petition of administration with the probate court in the county where the decedent was a resident. 
  1. Validation of the Will: The probate judge verifies the validity of the will and grants legal authority to the designated personal representative to execute the will. 
  1. Beneficiary and Creditor Notification: The personal representative informs all beneficiaries listed in the will about initiating probate proceedings. Moreover, the personal representative is responsible for notifying potential creditors with claims against the estate. This notification process adheres to the formalities specified in Florida Statute 733.2121. Creditors are granted a 90-day window, starting from notification, to file claims against the estate. 
  1. Estate Valuation: The personal representative gathers documentation and assets to assess the estate’s value and establish an estate bank account. Assets might need to be liquidated to settle valid creditor claims. The estate bank account funds the repayment of creditors. 
  1. Probate Conclusion: After addressing all creditor claims, beneficiaries are entitled to the assets delineated in the will. Upon asset distribution, the attorney files a petition of discharge, marking the formal conclusion of the probate process. 

Legal Expertise for Smooth Estate Proceedings 

Navigating the intricacies of probate is essential to ensure a smooth estate settlement process. Whether you are a personal representative or responsible for handling someone’s estate, understanding your options can save both time and resources. If you are seeking expert guidance in estate planning and probate matters, contact the Boutty Law Firm at (407) 622-1395. Our dedicated team is here to assist Orlando and Central Florida residents, helping you make informed decisions during probate proceedings. 

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Preliinary-Notice

What To Do If A Construction Lien Is Placed On Your Home in Florida

Liens are a legal remedy used by contractors, construction companies, and home service providers in Florida to ensure payment for completed services. A lien allows them to make a claim against your property to settle a debt. While an involuntary home sale to pay off the debt is rare, liens can make selling or refinancing your home difficult.  Construction lien law can be complex and confusing, so this article is an overview and starting point.  One priority for any property owner is to file a notice of commencement with the local clerk’s office before or very quickly after a project starts.  Many clerk’s offices have an acceptable form to follow for this notice, or go to Fla. Stat. §713.13 and follow the form provided.  The notice of commencement will generally have the following: 

  • The address of the property. 
  • The nature of the work performed. 
  • The names and addresses of the owner, general contractor, and surety. 

The reason for doing this is to provide accurate information so those individuals or companies that want to file a lien have the information they need to help them do so properly.  If you do not file a notice of commencement or record an inaccurate notice, this may be used by claimants whose time limit has lapsed as an exception to collect when otherwise their claim would have been barred.  

Who Can File A Lien?  

Under Florida’s Construction Lien Law (Chapter 713, Florida Statutes), anyone who worked on a property and didn’t receive payment for their services may file a lien on that property. Liens can be filed against your property even if you have already paid the contractor or business but they failed to pay their employees or subcontractors. Various service providers may file a lien, including material providers, contractors, subcontractors, architects, engineers, interior designers, and surveyors. Homeowner associations (HOAs) and the IRS can also place liens if you have unpaid dues or owe back taxes. 

How Liens Are Filed  

To file a valid lien in Florida, the eligible person or business must do so within 90 days from the last day they furnished labor or materials to improve the property to record a construction lien properly.  The person or business owner must inform you of their intention to place a lien through a formal Notice to Owner, following the specific format stated in Chapter 713 of the Florida Statutes. The Notice to Owner should include your name and address, a description of the services or work performed, the amount due, the filing date, and a clear warning about the implications of a lien, as described in the statute.  A proper lien acts as security to their right to payment from the property owner, and once recorded, the lien is valid for one (1) year.      

How Do You Remove a Lien From Your Property?  

If you receive a Notice to Owner or discover a lien on your property, you have several options to attempt its release: 

  1. Pay off the lien. The most straightforward and quickest way to remove a lien is to pay off the debt owed to the contractor or service provider with a valid claim against your property. Keep a record of all payments made, and once the final payment is made, request a final payment affidavit and a formal release of lien to ensure its removal from your property record. 
  1. Request a Lien Release If you believe the lien was wrongfully filed, you can request a formal release of the lien from the lienor. Provide documentation proving the debt was paid in full and request the lien’s removal. 
  1. File a Contest of Lien. The owner may pressure the business or person filing the claim by filing a Notice of Contest of Lien form as provided in the body of the statute (Fla. Stat. §713.22(2)), which shortens the time the claimant has to institute their action to sixty (60) days, or the lien is automatically extinguished. 
  1. Allow the Lien to Expire. If the lienor fails to file a lawsuit within 1 year of filing the lien or 60 days from a Contest of Lien, the lien automatically expires.  

Real Estate Attorneys You Can Trust: The Boutty Law Firm. Dealing with property liens in Florida can be complex and requires adherence to specific guidelines outlined in state law. If you have a lien on your property, seek assistance from experienced real estate attorneys like our team at The Boutty Law Firm. Contact our Maitland, Florida, office at 407-622-1395 to discuss your case. 

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Creditors-Img

How to Handle Creditor Claims During Probate

Personal representatives have many roles during the probate process, including valuing the estate, notifying beneficiaries, and assisting in distributing assets. Another crucial responsibility personal representatives have during probate is to notify creditors that the estate has entered probate and to settle debts. There are specific requirements personal representatives and creditors must follow to ensure valid claims are paid. Below, we discuss what you need to know about handling creditor claims during Florida probate proceedings.  

What is a Creditor Claim? 

Creditor claims are formal notices against the decedent’s estate, indicating that a debt is owed. Valid claims are paid from the estate’s value before assets and funds are distributed to beneficiaries listed in the will. 

Types of Creditors 

Anyone the decedent borrowed money from and didn’t pay in full could have a valid creditor claim against the estate. Creditors can be individuals, companies, or organizations. Types of creditors may include:  

  • Mortgage lenders  
  • The IRS 
  • Plaintiffs in open lawsuits against the decedent 
  • Individuals who were promised payment from the estate upon death 
  • Funeral service providers  
  • Credit card companies  
  • Home-related service providers  
  • Medical facilities  
  • Ex-spouses who are owed back child support 
  • Business owners

How to Notify Potential Creditors 

Personal representatives must follow specific guidelines to formally notify creditors that the decedent’s estate has entered probate, as stated in  Florida Statute 733.2121. Personal representatives must publish a Notice to Creditors once a week for two consecutive weeks in a newspaper located in the county where the estate is administered. If there isn’t a local paper, the notice can be published in any newspaper in general circulation in the county. The notice must include the following: 

  • The decedent’s name 
  • Court address 
  • Estate file number 
  • The personal representative’s contact information 
  • Date of first publication 
  • Creditor claim period dates  

The personal representative must provide proof of the public notice to the probate court within 45 days of publication.  

In addition, personal representatives must locate potential creditors and send the notice directly to them. Personal representatives must conduct proper research to find and notify potential creditors. However, they aren’t liable for failing to inform creditors as long as a reasonable effort is made.  

Creditor Claim Distribution 

Creditor claims are paid from the value of the estate. Creditors must show proof of the money the decedent owed by referencing a contract, providing a promissory note, or supplying a transaction history of other payments. According to Florida Statute 733.705, creditors have three months after the notice publication to make claims against the estate. If the creditor was contacted directly, they have 30 days to file a claim. In most cases, claims are paid out five months after the first notice was published. 

Florida laws dictate the hierarchy used to determine how creditor claims are paid off. Claims related to probate administration and attorney’s fees are paid off first. Next are funeral service providers. Then, any federal claims to the estate, such as back taxes, are paid.  

Objecting a Claim  

Personal representatives or any beneficiary with a vested interest in the estate can object to a potential creditor claim. They must file a formal written objection within four months after the notice was published or 30 days after the creditor filed the claim — whichever was later. 

Navigating the Complexities of Probate with the Boutty Law Firm  

Probate is a time-consuming process with many formal parts. To ensure probate proceedings are handled effectively and efficiently, it’s important to work with an experienced Florida probate attorney, like our team at the Boutty Law Firm. We’ll help guide you through the probate process and help assess issues, such as handling creditor claims. Call us at 407-710-0461 to schedule a consultation.

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