When Florida homeowners hire a contractor for construction or renovation, it’s common to pay a deposit upfront. But what happens when the contractor cashes the check—and then disappears or fails to begin the job? While many homeowners assume they can cancel the contract outright, the law is more nuanced.
Florida Statute § 489.126 does not give a homeowner a direct right to cancel a contract—but it does establish rules that contractors must follow when they receive a large deposit. If those rules are violated, serious consequences can follow—including potential criminal liability.
What Does Florida Statute § 489.126 Say?
Section 489.126 applies when a contractor receives an initial payment greater than 10% of the total contract pricefor residential construction, repairs, or improvements.
Under § 489.126(1)(a), Florida Statutes (2024), that contractor must:
- Apply for any necessary permits within 30 days after receiving the deposit; and
- Begin the work within 90 days after the permits have been issued.
These timelines aim to prevent contractors from taking large sums of money and delaying or abandoning the job.
What If the Contractor Fails to Pull Permits or Start Work?
If the contractor does not apply for permits within 30 days or fails to start work within 90 days of the permit being issued, and has no lawful excuse, the violation may be treated as theft.
§ 489.126(4), Florida Statutes provides:
“A contractor who violates subsection (1) is guilty of theft and subject to prosecution under s. 812.014.”
What Action Must the Homeowner Take Before Proceeding?
Importantly, § 489.126(1)(b)1. outlines a specific procedure the homeowner must follow to formally place the contractor on notice and demand performance or refund:
“If a contractor fails to comply with the requirements of paragraph (a), the contractee must make written demand to the contractor in the form of a letter that includes a demand to apply for the necessary permits, to start the work, or to refund the payment…”
The statute requires that this demand be:
- Sent via certified mail, return receipt requested
- Mailed to the contractor’s address listed in the contract
- If no contract address is listed, the letter must be mailed to the contractor’s address on file with the Florida Department of Business and Professional Regulation (DBPR) or local licensing board.
This formal demand is a prerequisite to inferring a statutory violation and can be crucial if criminal or civil action is pursued.
What Happens if the Contractor Ignores the Demand?
Under § 489.126(1)(b)2., the statute provides a burden-shifting inference:
“It may be inferred that a contractor does not have just cause if the contractor fails to apply for the necessary permits, start the work, or refund payments within 30 days of receiving the written demand…”
This means that if the contractor fails to respond or take action within 30 days of receiving the certified demand letter, a court—or law enforcement—may infer that no legitimate excuse exists. This inference can support a criminal complaint or bolster a civil claim for breach, rescission, or fraud.
What Remedies Are Available to the Homeowner?
While § 489.126 itself doesn’t give homeowners the right to cancel a contract or automatically receive a refund, it creates powerful enforcement tools that can be used in conjunction with other legal remedies, including:
- Reporting the contractor to law enforcement or DBPR
- Suing for breach of contract or unjust enrichment
- Seeking rescission of the agreement
- Filing a claim with the Florida Homeowners’ Construction Recovery Fund (if the contractor is licensed)
Consult with a Florida Construction Attorney
If your contractor took a deposit and failed to apply for permits or begin work, your rights may include both civil remedies and the right to seek criminal enforcement under Florida law. However, strict procedures must be followed, including the certified demand letter under § 489.126.
At Andrew Douglas, P.A., we help homeowners navigate these issues, recover lost funds, and pursue both legal and regulatory remedies.
📞 Call us at 954.474.4420
📧 Email: andrew@douglasfirm.com
🌐 Visit: www.douglasfirm.com