Sometimes we are asked by a home or business owner why they have to sign a Notice of Commencement (NOC) when installing a solar pool heating, solar water heating, or solar electric system. Buyers may not realize that when purchasing a solar energy system, they are entering into a binding construction contract, which falls under the Florida Construction Lien Laws. Any time permitted improvements are made to real property, owners should consider a contract to be handled as any other construction contract. The laws are a bit complex, but the purpose of a NOC is pretty simple:
- It notifies the jurisdiction that improvements are being made to real property.
- It is required by Florida Statute that the building department NOT inspect a job valued over $2,500 unless an NOC is filed, even if a permit has been issued.
- If a contractor is not paid for its work, it can attempt to lien a property in an attempt to collect (subject to complex and strict requirements).
- It can protect a homeowner from a contractor that does not pay its subcontractors or suppliers.
- It may limit the payment liability for homeowners to the value of the project.
The NOC must be notarized in most jurisdictions, but some just require a signed document. Your contractor will be able to provide the correct form and requirements. Once completed, the contractor will file the NOC with the Clerk of Courts and obtain a certified copy, which is supplied to the building department. Only at that time may a building official complete inspections of permits.
The NOC is common practice in the construction trade, and helps owners and contractors comply with Florida law and protect themselves against contract disputes. If you are concerned with the ramifications of this document, talk to your contractor or consult your attorney. There is nothing to fear from an NOC as long as you intend to pay for the value added to your property in accordance with a valid construction contract.
The requirement for a building department to have a NOC filed with the County Clerk is found in Florida Statute 713.135(1)(d). The complete text follows:
713.135 Notice of commencement and applicability of lien.—
(d) Furnish to the applicant two or more copies of a form of notice of commencement conforming with s.713.13. If the direct contract is greater than $2,500, the applicant shall file with the issuing authority prior to the first inspection either a certified copy of the recorded notice of commencement or a notarized statement that the notice of commencement has been filed for recording, along with a copy thereof. In the absence of the filing of a certified copy of the recorded notice of commencement, the issuing authority or a private provider performing inspection services may not perform or approve subsequent inspections until the applicant files by mail, facsimile, hand delivery, or any other means such certified copy with the issuing authority. The certified copy of the notice of commencement must contain the name and address of the owner, the name and address of the contractor, and the location or address of the property being improved. The issuing authority shall verify that the name and address of the owner, the name of the contractor, and the location or address of the property being improved which is contained in the certified copy of the notice of commencement is consistent with the information in the building permit application. The issuing authority shall provide the recording information on the certified copy of the recorded notice of commencement to any person upon request. This subsection does not require the recording of a notice of commencement prior to the issuance of a building permit. If a local government requires a separate permit or inspection for installation of temporary electrical service or other temporary utility service, land clearing, or other preliminary site work, such permits may be issued and such inspections may be conducted without providing the issuing authority with a certified copy of a recorded notice of commencement or a notarized statement regarding a recorded notice of commencement. This subsection does not apply to a direct contract to repair or replace an existing heating or air-conditioning system in an amount less than $7,500.