Published by American Lawyer Media/ALM.com
On Thursday, April 13, 2023, Florida Governor Ron DeSantis signed Senate Bill 360 into law. This legislation alters the time period for bringing forward construction defect lawsuits, as well as modifies the current private right of action against a contractor for violation of the Florida Building Code.
First, SB 360 amends § 95.11(3)(c), Florida Statutes, to reduce the statute of repose from ten years to seven years for actions founded on latent construction defects. The legislation also changes the manner in which this time period is calculated under both the seven-year statute of repose and four-year statute of limitations for construction defect cases.
Under the prior statute, the time to commence an action began with the later of (i) the date of actual possession by the owner, (ii) the date of the issuance of a certificate of occupancy (CO) (iii) the date of abandonment of construction if not completed, or (iv) the date of completion or termination of the contract.
Under the revised statute, the time to commence an action begins with the earlier of (i) the date of issuance of a temporary certificate of occupancy (TCO), a CO, or a certificate of completion (CC), or (ii) the date of abandonment if construction is not completed.
This change provides a concrete point in time from which to measure the limitations or repose period where CC, TCO, or CC are issued by allowing owners, design professionals, and contractors alike to know exactly when time for filing suit will expire. In turn, courts will require fewer resources in determining whether a defect claim is barred.
On the other hand, this amendment creates room for uncertainty in situations where a TCO, CO, or CC is not generally issued and the project is not abandoned by the contractor.
For example, projects such as window replacement, roof replacement, air conditioning or heating system replacement, pool installation, interior remodeling, and installation of security or technology systems are typically completed without issuing a TCO, CO, or CC. Certainly, there are to be situations where defects arise from this type of work, and it will now be difficult to pinpoint how long an owner has to bring a claim.
With the prior statute, at least the date of completion of the contract was provided to serve as the trigger. The passage of another recent statute HB 837, which reduced the time to bring negligence actions from four years to two years, may also create complications in projects where there is not a CO, TCO or a CC. Unfortunately, future court decisions or statutory amendment may be needed to resolve those uncertainties.
Also as part of the amendments to § 95.11(3)(c), Florida Statutes, SB 360 adds a specific time of commencement for newly constructed single family homes that are first used as a model home. Under these circumstances, the time to bring an action begins to run when the deed transferring title from the developer to the purchaser is recorded. This addition offsets the effect of the change in when the limitations or repose period begins to run on purchasers of former model homes, as it prevents the limitations or repose period from running before the purchaser actually obtains title to the home.
Additionally, the legislation clarifies that if a project consists of “the design, planning, or construction of multiple buildings,” each building will be considered separate for determining the limitations period, based upon when that building receives a TCO, CO, or certificate of completion.
The final substantive change established by SB 360 is a modification of the standard for bringing a private action for violation of the Florida Building Code under § 553.84, Florida Statutes. Now, for such a violation to be actionable, it must be a material violation.
Material is subsequently defined as a violation within a completed structure “which may reasonably result, or has resulted, in physical harm to a person or significant damage to the performance of a building or its systems.”
This amendment serves to eliminate actions based upon merely technical violations of the Building Code that pose no measurable risk to life or property.
The changes imposed by SB 360 became effective immediately upon the bill being signed into law, on April 13, 2023. Importantly, the changes to the limitations and repose period apply to any action commenced after the effective date, regardless of when the claim accrued. However, the new law does contain a grace period for claims that would not have been barred under the previous version of § 95.11(3)(c), but are now barred under the new version. For these actions, a claimant has until July 1, 2024 to bring the claim.
Jessica Zelitt is an Associate in the Adams and Reese Sarasota office, practicing as a litigator representing clients within the construction, commercial, and real estate arenas in all phases of the litigation process.