Bill Text: FL S0736 | 2022 | Regular Session | Comm Sub
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Construction Defect and Building Code Violation Claims
Spectrum: Slight Partisan Bill (? 3-1)
Status: (Failed) 2022-03-14 - Died in returning Messages [S0736 Detail]
Download: Florida-2022-S0736-Comm_Sub.html
Bill Title: Construction Defect and Building Code Violation Claims
Spectrum: Slight Partisan Bill (? 3-1)
Status: (Failed) 2022-03-14 - Died in returning Messages [S0736 Detail]
Download: Florida-2022-S0736-Comm_Sub.html
Florida Senate - 2022 CS for CS for CS for SB 736 By the Committees on Rules; Community Affairs; and Judiciary; and Senator Hutson 595-02700-22 2022736c3 1 A bill to be entitled 2 An act relating to construction defect claims; 3 amending s. 95.11, F.S.; revising the limitations 4 period for certain actions founded on the design, 5 planning, or construction of an improvement to real 6 property; amending s. 627.441, F.S.; conforming a 7 cross-reference; amending s. 558.004, F.S.; requiring 8 a notice of claim to include an inspection report that 9 is verified by the person conducting the inspection; 10 specifying the required contents of the report; 11 providing that a bad faith preparation of an 12 inspection report constitutes grounds for discipline; 13 specifying that the person preparing the inspection 14 report does not have an obligation to perform certain 15 testing; requiring a claimant to include the reasons 16 for rejecting an offer in a notice rejecting a 17 settlement offer to remedy a construction defect; 18 authorizing the person served with a notice rejecting 19 a settlement offer to make a supplemental offer within 20 a specified timeframe; providing notice requirements 21 for a claimant who rejects a supplemental offer; 22 requiring the court to stay an action if a claimant 23 initiates an action without first accepting or 24 rejecting a supplemental offer; limiting entitlement 25 to attorney fees if a claimant rejects certain 26 settlement offers to fully repair an alleged 27 construction defect; requiring a claimant who accepts 28 a certain offer to enter into a contract to complete 29 repairs to remedy an alleged construction defect; 30 requiring the offeror or insurer to pay the contractor 31 or contractors directly for the repairs; prohibiting 32 an offeror or insurer from requiring a claimant to 33 advance payment for repairs; requiring that the 34 repairs be completed within a specified timeframe; 35 creating s. 558.0045, F.S.; requiring a court to 36 appoint an expert to examine certain alleged 37 construction defects and to prepare an examination 38 report, under certain circumstances; requiring that 39 the report contain specified information; requiring 40 the parties to compensate the expert; prohibiting the 41 expert from being employed to make repairs or from 42 recommending contractors to make repairs; creating s. 43 558.0046, F.S.; requiring a claimant to repair a 44 construction defect if the claimant receives 45 compensation for an alleged construction defect from 46 specified persons; providing that a claimant is liable 47 for damages resulting from failure to disclose a 48 construction defect to a purchaser of a property; 49 providing applicability; providing an effective date. 50 51 Be It Enacted by the Legislature of the State of Florida: 52 53 Section 1. Paragraph (c) of subsection (3) of section 54 95.11, Florida Statutes, is amended, and subsection (12) is 55 added to that section, to read: 56 95.11 Limitations other than for the recovery of real 57 property.—Actions other than for recovery of real property shall 58 be commenced as follows: 59 (3) WITHIN FOUR YEARS.— 60(c) An action founded on the design, planning, or61construction of an improvement to real property, with the time62running from the date of actual possession by the owner, the63date of the issuance of a certificate of occupancy, the date of64abandonment of construction if not completed, or the date of65completion of the contract or termination of the contract66between the professional engineer, registered architect, or67licensed contractor and his or her employer, whichever date is68latest; except that, when the action involves a latent defect,69the time runs from the time the defect is discovered or should70have been discovered with the exercise of due diligence. In any71event, the action must be commenced within 10 years after the72date of actual possession by the owner, the date of the issuance73of a certificate of occupancy, the date of abandonment of74construction if not completed, or the date of completion of the75contract or termination of the contract between the professional76engineer, registered architect, or licensed contractor and his77or her employer, whichever date is latest. However,78counterclaims, cross-claims, and third-party claims that arise79out of the conduct, transaction, or occurrence set out or80attempted to be set out in a pleading may be commenced up to 181year after the pleading to which such claims relate is served,82even if such claims would otherwise be time barred. With respect83to actions founded on the design, planning, or construction of84an improvement to real property, if such construction is85performed pursuant to a duly issued building permit and if a86local enforcement agency, state enforcement agency, or special87inspector, as those terms are defined in s. 553.71, has issued a88final certificate of occupancy or certificate of completion,89then as to the construction which is within the scope of such90building permit and certificate, the correction of defects to91completed work or repair of completed work, whether performed92under warranty or otherwise, does not extend the period of time93within which an action must be commenced. Completion of the94contract means the later of the date of final performance of all95the contracted services or the date that final payment for such96services becomes due without regard to the date final payment is97made.98 (12) ACTIONS RELATING TO AN IMPROVEMENT TO REAL PROPERTY.— 99 (a) Running of time to commence action.—An action founded 100 on the design, planning, or construction of an improvement to 101 real property must be commenced within the timeframes set forth 102 in this section or the action is time barred. 103 1. The time to commence the action runs from the date of 104 actual possession by the owner, the date of the issuance of a 105 certificate of occupancy, the date of abandonment of 106 construction if not completed, or the date of completion of the 107 contract or termination of the contract between the professional 108 engineer, registered architect, or licensed contractor and his 109 or her employer, whichever date is earliest. For the purposes of 110 this subparagraph, the term “completion of the contract” means 111 the later of the date of final performance of all the contracted 112 services or the date that final payment for such services 113 becomes due without regard to the date final payment is made. 114 2. Counterclaims, cross-claims, and third-party claims that 115 arise out of the conduct, transaction, or occurrence set out or 116 attempted to be set out in a pleading may be commenced up to 1 117 year after the pleading to which such claims relate is served, 118 even if such claims would otherwise be time barred. 119 3. If the action is based on construction that is performed 120 pursuant to a duly issued building permit and if a local 121 enforcement agency, state enforcement agency, or special 122 inspector, as those terms are defined in s. 553.71, has issued a 123 final certificate of occupancy or certificate of completion, 124 then as to the construction which is within the scope of such 125 building permit and certificate, the correction of defects to 126 completed work or repair of completed work, whether performed 127 under warranty or otherwise, does not extend the period of time 128 within which an action must be commenced. 129 (b) Limitations and repose periods.— 130 1. An action founded on the design, planning, or 131 construction of an improvement to real property may be commenced 132 within 4 years after the time to commence an action begins to 133 run. 134 2. An action involving a latent defect may be commenced 135 within 4 years after the facts giving rise to the cause of 136 action are discovered or should have been discovered through the 137 exercise of due diligence. However, the action may not be 138 commenced more than 5 years after the time for commencing an 139 action begins to run for a one-family, two-family, or three 140 family residence not exceeding two habitable stories above no 141 more than one uninhabitable story and accessory use structures 142 in connection therewith and 10 years for any other improvement. 143 Section 2. Subsection (2) of section 627.441, Florida 144 Statutes, is amended to read: 145 627.441 Commercial general liability policies; coverage to 146 contractors for completed operations.— 147 (2) A liability insurer must offer coverage at an 148 appropriate additional premium for liability arising out of 149 current or completed operations under an owner-controlled 150 insurance program for any period beyond the period for which the 151 program provides liability coverage, as specified in s. 152 255.0517(2)(b). The period of such coverage must be sufficient 153 to protect against liability arising out of an action brought 154 within the time limits provided in s. 95.11(12)s. 95.11(3)(c). 155 Section 3. Present subsections (8) through (15) of section 156 558.004, Florida Statutes, are redesignated as subsections (9) 157 through (16), respectively, a new subsection (8) is added to 158 that section, and paragraphs (b) and (c) of subsection (1) and 159 subsection (7) of that section are amended, to read: 160 558.004 Notice and opportunity to repair.— 161 (1) 162 (b)1. The notice of claim must include an inspection report 163 that is verified pursuant to s. 92.525 by a contractor, 164 engineer, building code inspector, or other inspector who has a 165 state license and experience relevant to the type of 166 construction that is the basis of the claim. The report must 167 include all of the following: 168 a. A short statement describing the relevant experience and 169 licenses of the person conducting the inspection. 170 b. A description of each alleged construction defect; a 171 clear description of the location of the defect; pictures, 172 videos, and any results of testing which pertain to the defect; 173 and, if known, an explanation of the damage resulting from the 174 defect. 175 c. A description of how the inspection was conducted, 176 including a description of any specialized equipment used during 177 the inspection or of any tests conducted. 178 d. An explanation of whether or to what extent and how the 179 property owner or person acting at the direction of the property 180 owner inspected, maintained, repaired, or renovated a portion of 181 the structure containing the alleged defect since the owner took 182 possession of the structure. 183 2. The preparation of an inspection report in bad faith 184 constitutes grounds for discipline by any relevant licensing 185 board or agency. 186 3. The claimant and the person preparing the inspection 187 report do not have andescribe in reasonable detail the nature188of each alleged construction defect and, if known, the damage or189loss resulting from the defect. Based upon at least a visual190inspection by the claimant or its agents, the notice of claim191must identify the location of each alleged construction defect192sufficiently to enable the responding parties to locate the193alleged defect without undue burden. The claimant has no194 obligation to perform destructive or other testing for purposes 195 of this notice. 196 (c) The claimant shall endeavor to serve the notice of 197 claim within 15 days after discovery of an alleged defect, but 198 the failure to serve notice of claim within 15 days does not bar 199 the filing of an action, subject to s. 558.003. This subsection 200 does not preclude a claimant from filing an action sooner than 201 60 days, or 120 days as applicable, after service of written 202 notice as expressly provided in subsection (6), subsection (7), 203 or subsection (9)(8). 204 (7)(a) A claimant who receives a timely settlement offer 205 must accept or reject the offer by serving written notice of 206 such acceptance or rejection on the person making the offer 207 within 45 days after receiving the settlement offer. 208 (b) If the claimant rejects the settlement offer, the 209 claimant must include the reasons for rejecting the offer in the 210 notice rejecting the offer. If the claimant believes that the 211 settlement offer omitted reference to any portion of the claim 212 or was unreasonable in any manner, the claimant must include in 213 the notice the items that the claimant believes were omitted and 214 state in detail all known reasons why the claimant believes the 215 settlement offer is unreasonable. 216 (c) Upon receipt of a claimant’s notice of rejection and 217 the reasons for such rejection, the person served with the 218 rejection, within 15 days after receipt of the notice, may make 219 a supplemental offer of repair or monetary payment, or both, to 220 the claimant. 221 (d) If the claimant rejects a supplemental offer to repair 222 the construction defect or to settle the claim by monetary 223 payment or a combination of both, the claimant must serve 224 written notice of the claimant’s rejection on the person making 225 the supplemental offer. The notice must include all known 226 reasons for the claimant’s rejection of the supplemental 227 settlement offer. 228 (e) If a claimant initiates an action without first 229 accepting or rejecting the offer or supplemental offer, the 230 court shall stay the action upon timely motion until the 231 claimant complies with this subsection. 232 (8)(a) If the claimant rejects a timely settlement offer or 233 supplemental offer provided to remedy the alleged construction 234 defect at no cost to the claimant, in any action brought for 235 that defect, the claimant may not recover attorney fees from the 236 offeror on any basis unless the claimant proves by a 237 preponderance of the evidence that, at the time of the offer, 238 additional repairs beyond those offered were necessary to remedy 239 the defect. This paragraph does not apply to any claim for 240 attorney fees based on a contract between the claimant and the 241 offeror. 242 (b) If a claimant accepts an offer made pursuant to 243 paragraph (5)(b), paragraph (5)(c), or paragraph (5)(e) or a 244 supplemental offer made pursuant to paragraph (7)(c), the 245 claimant must, within 90 days after the acceptance, enter into a 246 contract with one or more appropriately licensed contractors to 247 complete the repairs necessary to remedy the alleged 248 construction defect. The offeror or insurer shall pay directly 249 to the contractor or contractors, from the accepted monetary 250 payment, the amounts necessary to begin and to continue the 251 repairs as the work is performed and expenses are incurred. The 252 offeror or insurer may not require the claimant to advance 253 payment for the repairs. The repairs must be completed within 12 254 months after the claimant enters into the contract for repairs, 255 absent mutual agreement between the offeror or insurer and the 256 claimant. 257 Section 4. Section 558.0045, Florida Statutes, is created 258 to read: 259 558.0045 Construction defect actions.— 260 (1) In a civil action alleging a construction defect, the 261 court shall appoint an engineer, a contractor, a building code 262 inspector, or another expert having experience in the type of 263 construction that is the basis of the claimant’s claim to 264 examine the alleged defect or, if repairs have been made, any 265 evidence of the alleged defect. However, the court may not 266 appoint an expert if all of the parties object or if the court 267 finds that the costs of an expert outweigh any potential 268 benefits to the resolution of the action. If an expert is 269 appointed, the expert must coordinate and communicate with the 270 parties as directed by the court. Within 15 days after 271 conducting the examination, or as otherwise determined by the 272 court, the expert shall submit a written report to the court for 273 its consideration and to the parties which contains the expert’s 274 findings. The report must do all of the following: 275 (a) Describe how the expert conducted the examination of 276 the alleged defect. 277 (b) Identify persons present at the site of the improvement 278 while the expert conducted the examination. 279 (c) Include photographs or other documentation of the 280 alleged defect including any relevant test results. 281 (d) State whether the damages claimed by the claimant are 282 more likely than not the result of a construction defect, 283 another identified cause, or a construction defect and another 284 identified cause. 285 (e) Address other matters related to the alleged defect as 286 directed by the court. 287 (2) If the expert concludes that the damages are wholly or 288 partially the result of a construction defect, the report must 289 state the actions necessary to repair the defect and any repairs 290 related to the defect, provide an estimate of the reasonable 291 cost of repairs, and state the anticipated time needed for 292 repairs under the current market conditions for construction 293 services and materials. 294 (3) The parties shall compensate the expert, but the 295 prevailing party is entitled to reimbursement from the 296 nonprevailing party. 297 (4) An expert appointed by the court under this section may 298 not be employed to repair the alleged defect or recommend 299 contractors to repair the defect. 300 Section 5. Section 558.0046, Florida Statutes, is created 301 to read: 302 558.0046 Duty to repair construction defect.—If a claimant 303 receives compensation for an alleged construction defect from a 304 contractor, a subcontractor, a supplier, a design professional, 305 or an insurer, the claimant must repair the defect. A claimant 306 who receives compensation and fails to fully repair the defect 307 is liable to a purchaser of the property for any damages 308 resulting from the failure to disclose the defect. 309 Section 6. (1) The amendments by this act to s. 310 95.11(3)(c), Florida Statutes, apply to any action commenced on 311 or after July 1, 2022, regardless of when the cause of action 312 accrued. However, any action that would not have been barred 313 under s. 95.11(3)(c), Florida Statutes, before the amendments 314 made by this act to that section may be commenced before July 1, 315 2023. If such action is not commenced by July 1, 2023, and is 316 barred by the amendments made by this act to s. 95.11(3)(c), 317 Florida Statutes, the action is barred. 318 (2) Sections 3 through 5 of this act apply to compensation 319 for construction defects received on or after July 1, 2022, and 320 to civil actions and proceedings for a construction defect which 321 are initiated on or after July 1, 2022. 322 Section 7. This act shall take effect July 1, 2022.