HB 1139CS

CHAMBER ACTION




1The Civil Justice Committee recommends the following:
2
3     Council/Committee Substitute
4     Remove the entire bill and insert:
5
A bill to be entitled
6An act relating to construction defects; amending ss.
7558.001, 558.002, and 558.004, F.S.; revising provisions
8to expand application to construction defects in any
9property other than public transportation projects;
10deleting language limiting application to only residential
11property; amending s. 558.005, F.S.; revising provisions
12relating to required notices for construction defect
13claims under certain construction contracts; applying
14provisions of ch. 558, F.S., notwithstanding certain
15notice requirements; providing an effective date.
16
17Be It Enacted by the Legislature of the State of Florida:
18
19     Section 1.  Section 558.001, Florida Statutes, is amended
20to read:
21     558.001  Legislative findings and declaration.--The
22Legislature finds that it is beneficial to have an alternative
23method to resolve construction disputes that would reduce the
24need for litigation as well as protect the rights of property
25owners homeowners. An effective alternative dispute resolution
26mechanism in certain construction defect matters should involve
27the claimant filing a notice of claim with the contractor,
28subcontractor, supplier, or design professional that the
29claimant asserts is responsible for the defect, and should
30provide the contractor, subcontractor, supplier, or design
31professional with an opportunity to resolve the claim without
32resort to further legal process.
33     Section 2.  Section 558.002, Florida Statutes, is amended
34to read:
35     558.002  Definitions.--As used in this chapter, the term:
36     (1)  "Action" means any civil action or arbitration
37proceeding for damages or indemnity asserting a claim for damage
38to or loss of real a dwelling or personal property caused by an
39alleged construction defect, but does not include any
40administrative action or any civil action or arbitration
41proceeding asserting a claim for alleged personal injuries
42arising out of an alleged construction defect.
43     (2)  "Association" has the same meaning as in s.
44718.103(2), s. 719.103(2), s. 720.301(9), or s. 723.075.
45     (3)  "Claimant" means a property owner homeowner, including
46a subsequent purchaser or association, who asserts a claim for
47damages against a contractor, subcontractor, supplier, or design
48professional concerning a construction defect or a subsequent
49owner who asserts a claim for indemnification for such damages.
50The term does not include a contractor, subcontractor, supplier,
51or design professional.
52     (4)  "Construction defect" means a deficiency in, or a
53deficiency arising out of, the design, specifications,
54surveying, planning, supervision, observation of construction,
55or construction, repair, alteration, or remodeling of a
56dwelling, any appurtenance to the dwelling, or the real property
57to which the dwelling or appurtenance is affixed resulting from:
58     (a)  Defective material, products, or components used in
59the construction or remodeling;
60     (b)  A violation of the applicable codes in effect at the
61time of construction or remodeling which gives rise to a cause
62of action pursuant to s. 553.84;
63     (c)  A failure of the design of real property a dwelling to
64meet the applicable professional standards of care at the time
65of governmental approval; or
66     (d)  A failure to construct or remodel real property a
67dwelling in accordance with accepted trade standards for good
68and workmanlike construction at the time of construction.
69     (5)  "Contractor" means any person, as defined in s. 1.01,
70that is legally engaged in the business of designing,
71developing, constructing, manufacturing, repairing, or
72remodeling real property dwellings or attachments thereto.
73     (6)  "Design professional" means a person, as defined in s.
741.01, licensed in this state as an architect, interior designer,
75landscape architect, engineer, or surveyor.
76     (7)  "Real property Dwelling" means land that is improved
77and the improvements on such land, including fixtures,
78manufactured housing, or mobile homes and excluding public
79transportation projects a single-family house, manufactured or
80modular home, duplex, triplex, quadruplex, or other multifamily
81unit in a multifamily residential building designed for
82residential use in which title to each individual unit is
83transferred to the owner under a condominium or cooperative
84system and includes common areas and improvements that are owned
85or maintained by an association or by members of an association,
86and also includes the systems, other components, improvements,
87and other structures or facilities, including, but not limited
88to, recreational structures or facilities, that are appurtenant
89to and located on the real property on which the house, duplex,
90triplex, quadruplex, or other multifamily unit is located, but
91are not necessarily part of the structure at the time of
92completion of construction.
93     (8)  "Service" means delivery by certified mail, return
94receipt requested, to the last known address of the addressee.
95     (9)  "Subcontractor" means a person, as defined in s. 1.01,
96who is a contractor who performs labor and supplies material on
97behalf of another contractor in the construction or remodeling
98of real property a dwelling.
99     (10)  "Supplier" means a person, as defined in s. 1.01, who
100provides only materials, equipment, or other supplies for the
101construction or remodeling of real property a dwelling.
102     Section 3.  Subsections (1), (2), (3), (4), (5), (8), (9),
103and (14) of section 558.004, Florida Statutes, are amended to
104read:
105     558.004  Notice and opportunity to repair.--
106     (1)  In actions brought alleging a construction defect, the
107claimant shall, at least 60 days before filing any an action
108involving a single-family home, an association representing 20
109or fewer residential parcels, a manufactured or modular home, a
110duplex, a triplex, or a quadruplex, or at least 120 days before
111filing an action involving an association representing more than
11220 parcels residential parcel owners, serve written notice of
113claim on the contractor, subcontractor, supplier, or design
114professional, as applicable, which notice shall refer to this
115chapter. If the construction defect claim arises from work
116performed under a contract, the written notice of claim must be
117served on the person with whom the claimant contracted. The
118notice of claim must describe the claim in reasonable detail
119sufficient to determine the general nature of each alleged
120construction defect and a description of the damage or loss
121resulting from the defect, if known. The claimant shall endeavor
122to serve the notice of claim within 15 days after discovery of
123an alleged defect, but the failure to serve notice of claim
124within 15 days does not bar the filing of an action, subject to
125s. 558.003. This subsection does not preclude a claimant from
126filing an action sooner than 60 days, or 120 days as applicable,
127after service of written notice as expressly provided in
128subsection (6), subsection (7), or subsection (8).
129     (2)  Within 30 days after receipt of the notice of claim
130involving a single-family home, an association representing 20
131or fewer residential parcels, a manufactured or modular home, a
132duplex, a triplex, or a quadruplex, or within 50 days after
133receipt of the notice of claim involving an association
134representing more than 20 residential parcels, the person
135receiving the notice of claim under subsection (1) is entitled
136to perform a reasonable inspection of the property dwelling or
137of each unit subject to the claim to assess each alleged
138construction defect. An association's right to access property
139for either maintenance or repair includes the authority to grant
140access for the inspection. The claimant shall provide the person
141receiving the notice under subsection (1) and such person's
142contractors or agents reasonable access to the property dwelling
143during normal working hours to inspect the property dwelling to
144determine the nature and cause of each alleged construction
145defect and the nature and extent of any repairs or replacements
146necessary to remedy each defect. The person receiving notice
147under subsection (1) shall reasonably coordinate the timing and
148manner of any and all inspections with the claimant to minimize
149the number of inspections. The inspection may include
150destructive testing by mutual agreement under the following
151reasonable terms and conditions:
152     (a)  If the person receiving notice under subsection (1)
153determines that destructive testing is necessary to determine
154the nature and cause of the alleged defects, such person shall
155notify the claimant in writing.
156     (b)  The notice shall describe the destructive testing to
157be performed, the person selected to do the testing, the
158estimated anticipated damage and repairs to the property
159dwelling resulting from the testing, the estimated amount of
160time necessary for the testing and to complete the repairs, and
161the financial responsibility offered for covering the costs of
162repairs.
163     (c)  If the claimant promptly objects to the person
164selected to perform the destructive testing, the person
165receiving notice under subsection (1) shall provide the claimant
166with a list of three qualified persons from which the claimant
167may select one such person to perform the testing. The person
168selected to perform the testing shall operate as an agent or
169subcontractor of the person receiving notice under subsection
170(1) and shall communicate with, submit any reports to and be
171solely responsible to the person receiving notice.
172     (d)  The testing shall be done at a mutually agreeable
173time.
174     (e)  The claimant or a representative of the claimant may
175be present to observe the destructive testing.
176     (f)  The destructive testing shall not render the property
177dwelling uninhabitable.
178
179In the event the claimant fails or refuses to agree to
180destructive testing, the claimant shall have no claim for
181damages which could have been avoided or mitigated had
182destructive testing been allowed when requested and had a
183feasible remedy been promptly implemented.
184     (3)  Within 10 days after receipt of the notice of claim
185involving a single-family home, an association representing 20
186or fewer residential parcels, a manufactured or modular home, a
187duplex, a triplex, or a quadruplex, or within 30 days after
188receipt of the notice of claim involving an association
189representing more than 20 residential parcels, the person
190receiving the notice under subsection (1) may forward a copy of
191the notice of claim to each contractor, subcontractor, supplier,
192or design professional whom it reasonably believes is
193responsible for each defect specified in the notice of claim and
194shall note the specific defect for which it believes the
195particular contractor, subcontractor, supplier, or design
196professional is responsible. Each such contractor,
197subcontractor, supplier, and design professional may inspect the
198property dwelling as provided in subsection (2).
199     (4)  Within 15 days after receiving a copy of the notice of
200claim pursuant to subsection (3) involving a single-family home,
201an association representing 20 or fewer residential parcels, a
202manufactured or modular home, a duplex, a triplex, or a
203quadruplex, or within 30 days after receipt of the copy of the
204notice of claim involving an association representing more than
20520 residential parcels, the contractor, subcontractor, supplier,
206or design professional must serve a written response to the
207person who forwarded a copy of the notice of claim. The written
208response shall include a report, if any, of the scope of any
209inspection of the property dwelling, the findings and results of
210the inspection, a statement of whether the contractor,
211subcontractor, supplier, or design professional is willing to
212make repairs to the property dwelling or whether such claim is
213disputed, a description of any repairs they are willing to make
214to remedy the alleged construction defect, and a timetable for
215the completion of such repairs.
216     (5)  Within 45 days after receiving the notice of claim
217involving a single-family home, an association representing 20
218or fewer residential parcels, a manufactured or modular home, a
219duplex, a triplex, or a quadruplex, or within 75 days after
220receipt of a copy of the notice of claim involving an
221association representing more than 20 residential parcels, the
222person who received notice under subsection (1) must serve a
223written response to the claimant. The response shall be served
224to the attention of the person who signed the notice of claim,
225unless otherwise designated in the notice of claim. The written
226response must provide:
227     (a)  A written offer to remedy the alleged construction
228defect at no cost to the claimant, a detailed description of the
229proposed repairs necessary to remedy the defect, and a timetable
230for the completion of such repairs;
231     (b)  A written offer to compromise and settle the claim by
232monetary payment, that will not obligate the person's insurer,
233and a timetable for making payment;
234     (c)  A written offer to compromise and settle the claim by
235a combination of repairs and monetary payment, that will not
236obligate the person's insurer, that includes a detailed
237description of the proposed repairs and a timetable for the
238completion of such repairs and making payment;
239     (d)  A written statement that the person disputes the claim
240and will not remedy the defect or compromise and settle the
241claim; or
242     (e)  A written statement that a monetary payment, including
243insurance proceeds, if any, will be determined by the person's
244insurer within 30 days after notification to the insurer by
245means of forwarding the claim, which notification shall occur at
246the same time the claimant is notified of this settlement
247option, which the claimant can accept or reject. A written
248statement under this paragraph may also include an offer under
249paragraph (c), but such offer shall be contingent upon the
250claimant also accepting the determination of the insurer whether
251to make any monetary payment in addition thereto. If the insurer
252for the person receiving the claim makes no response within the
25330 days following notification, then the claimant shall be
254deemed to have met all conditions precedent to commencing an
255action.
256     (8)  If the claimant timely and properly accepts the offer
257to repair an alleged construction defect, the claimant shall
258provide the offeror and the offeror's agents reasonable access
259to the claimant's property dwelling during normal working hours
260to perform the repair by the agreed-upon timetable as stated in
261the offer. If the offeror does not make the payment or repair
262the defect within the agreed time and in the agreed manner,
263except for reasonable delays beyond the control of the offeror,
264including, but not limited to, weather conditions, delivery of
265materials, claimant's actions, or issuance of any required
266permits, the claimant may, without further notice, proceed with
267an action against the offeror based upon the claim in the notice
268of claim. If the offeror makes payment or repairs the defect
269within the agreed time and in the agreed manner, the claimant is
270barred from proceeding with an action for the claim described in
271the notice of claim or as otherwise provided in the accepted
272settlement offer.
273     (9)  This section does not prohibit or limit the claimant
274from making any necessary emergency repairs to the property
275dwelling as are required to protect the health, safety, and
276welfare of the claimant. In addition, any offer or failure to
277offer pursuant to subsection (5) to remedy an alleged
278construction defect or to compromise and settle the claim by
279monetary payment does not constitute an admission of liability
280with respect to the defect and is not admissible in an action
281brought under this chapter.
282     (14)  To the extent that an arbitration clause in a
283contract for the sale, design, construction, or remodeling of
284real property a dwelling conflicts with this section, this
285section shall control.
286     Section 4.  Section 558.005, Florida Statutes, is amended
287to read:
288     558.005  Contract provisions; application.--
289     (1)  Except as otherwise provided in subsections (3) and
290(4), the provisions of this chapter shall apply to control every
291contract for the design, construction, or remodeling of real
292property a dwelling entered into:
293     (a)  Between on or after July 1, 2004, and September 30,
2942006, which contains the notice as set forth in paragraph (2)(a)
295subsection (2) and is conspicuously set forth in capitalized
296letters.
297     (b)  On or after October 1, 2006, which contains the notice
298set forth in paragraph (2)(b) and is conspicuously set forth in
299capitalized letters.
300     (2)(a)  The notice required by paragraph (1)(a) subsection
301(1) must be in substantially the following form:
302
303
CHAPTER 558 NOTICE OF CLAIM
304
305CHAPTER 558, FLORIDA STATUTES, CONTAINS IMPORTANT REQUIREMENTS
306YOU MUST FOLLOW BEFORE YOU MAY BRING ANY LEGAL ACTION FOR AN
307ALLEGED CONSTRUCTION DEFECT IN YOUR HOME. SIXTY DAYS BEFORE YOU
308BRING ANY LEGAL ACTION, YOU MUST DELIVER TO THE OTHER PARTY TO
309THIS CONTRACT A WRITTEN NOTICE, REFERRING TO CHAPTER 558, OF ANY
310CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE AND PROVIDE
311SUCH PERSON THE OPPORTUNITY TO INSPECT THE ALLEGED CONSTRUCTION
312DEFECTS AND TO CONSIDER MAKING AN OFFER TO REPAIR OR PAY FOR THE
313ALLEGED CONSTRUCTION DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT
314ANY OFFER WHICH MAY BE MADE. THERE ARE STRICT DEADLINES AND
315PROCEDURES UNDER THIS FLORIDA LAW WHICH MUST BE MET AND FOLLOWED
316TO PROTECT YOUR INTERESTS.
317     (b)  The notice required by paragraph (1)(b) must expressly
318cite this chapter and be in substantially the following form:
319
320
CHAPTER 558 NOTICE OF CLAIM
321
322CHAPTER 558, FLORIDA STATUTES, CONTAINS IMPORTANT REQUIREMENTS
323YOU MUST FOLLOW BEFORE YOU MAY BRING ANY LEGAL ACTION FOR AN
324ALLEGED CONSTRUCTION DEFECT. SIXTY DAYS BEFORE YOU BRING ANY
325LEGAL ACTION, YOU MUST DELIVER TO THE OTHER PARTY TO THIS
326CONTRACT A WRITTEN NOTICE, REFERRING TO CHAPTER 558, OF ANY
327CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE AND PROVIDE
328SUCH PERSON THE OPPORTUNITY TO INSPECT THE ALLEGED CONSTRUCTION
329DEFECTS AND TO CONSIDER MAKING AN OFFER TO REPAIR OR PAY FOR THE
330ALLEGED CONSTRUCTION DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT
331ANY OFFER WHICH MAY BE MADE. THERE ARE STRICT DEADLINES AND
332PROCEDURES UNDER THIS FLORIDA LAW WHICH MUST BE MET AND FOLLOWED
333TO PROTECT YOUR INTERESTS.
334     (3)  After receipt of the initial notice of claim, a
335claimant and the person receiving notice under s. 558.004(1)
336may, by written mutual agreement, alter the procedure for the
337notice of claim process described in this chapter.
338     (4)  This chapter applies to all actions accruing on or
339after July 1, 2004, and all actions commenced on or after such
340date, regardless of the date of sale, issuance of a certificate
341of occupancy or its equivalent, or substantial completion of the
342construction dwelling. Notwithstanding the notice requirements
343of this section for contracts entered into between on or after
344July 1, 2004, and September 30, 2006, this chapter applies to
345all actions accruing before July 1, 2004, but not yet commenced
346as of July 1, 2004, and failure to include such the notice
347requirements of this section in a contract entered into prior to
348July 1, 2004, does not operate to bar the procedures of this
349chapter from applying to all such actions. Notwithstanding the
350notice requirements of this section for contracts entered into
351on or after October 1, 2006, this chapter applies to all actions
352accruing before July 1, 2004, but not yet commenced as of July
3531, 2004, and failure to include such notice requirements in a
354contract entered into before July 1, 2004, does not operate to
355bar the procedures of this chapter from applying to all such
356actions.
357     Section 5.  This act shall take effect October 1, 2006.


CODING: Words stricken are deletions; words underlined are additions.