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Construction Law Authority / Contracts  / When is a mandatory contractual venue clause in a construction contract not mandatory?

When is a mandatory contractual venue clause in a construction contract not mandatory?

As a subcontractor, you enter into a contract with a general contractor to perform construction work on a project located in a certain county in Florida. The contract, however, has a carefully worded mandatory venue clause stating that the venue for any lawsuit brought for breach of the contract shall be in a different county in Florida.

Unfortunately, things take a turn for the worse on the project. The general contractor does not pay you. Accordingly, you file a Claim of Lien. In turn, the general contractor transfers your lien to a bond pursuant to Florida Statute § 713.24; with the bond being posted in the clerk’s office of the county of the project’s location.

Now you need to file suit. You elect to sue for both a breach of the contract and for an action on your lien that was transferred to a bond (also known as a lien transfer bond). Where do you sue? Is it that certain county where the project is located and where the claim of lien was filed and transferred to a bond? Or, is it the other different county that is the specified venue in the parties’ contractual mandatory venue clause?

In Attaway Elec., Inc. v. Kelsey Const., Inc, 2013 WL 4006417 (Fla. 4th DCA Aug. 7, 2013) Florida’s Fourth District Court of Appeal recently opined on this issue. Reversing the trial court’s order transferring venue, the court stated that because a lien transfer claim must be brought in the county where the property is located and the lien transfer bond is filed, the related contractual claims must also be brought in that same county, notwithstanding the existence of a mandatory contractual venue clause specifying a different county. The court’s ruling was based, among other matters, on the avoidance of multiple lawsuits with potentially conflicting results.

The court in Attaway Elec., Inc also noted its disagreement with Florida’s Third District Court of Appeals decision in Walbridge Aldinger Co. v. Roberts Plumbing Contractors, Inc., 800 So.2d 285 (Fla. 3d DCA 2001) (a contractual venue provision required transfer of an action on a bonded lien from the county in which the property is located and the bond is posted to the county designated in the contractual venue provision). It remains to be seen whether the apparent disagreement in these decisions will be subject to further judicial review.

For now, however, depending upon the facts, circumstances, claims asserted, and location of the project in a particular case, a mandatory contractual venue clause in a construction contract may turn out to not be mandatory at all

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