HB 1139

CS

CHAMBER ACTION

1	The Justice Council recommends the following:
2
3	Council/Committee Substitute
4	Remove the entire bill and insert:
5	A bill to be entitled
6	An act relating to construction defects; amending ss.
7	558.001, 558.002, and 558.004, F.S.; revising provisions
8	to expand application to construction defects in any
9	property other than public transportation projects;
10	deleting language limiting application to only residential
11	property; amending s. 558.005, F.S.; revising provisions
12	relating to required notices for construction defect
13	claims under certain construction contracts; applying
14	provisions of ch. 558, F.S., notwithstanding certain
15	notice requirements; providing an effective date.
16
17	Be It Enacted by the Legislature of the State of Florida:
18
19	Section 1.  Section 558.001, Florida Statutes, is amended
20	to read:
21	558.001  Legislative findings and declaration.--The
22	Legislature finds that it is beneficial to have an alternative
23	method to resolve construction disputes that would reduce the
24	need for litigation as well as protect the rights of property
25	owners homeowners. An effective alternative dispute resolution
26	mechanism in certain construction defect matters should involve
27	the claimant filing a notice of claim with the contractor,
28	subcontractor, supplier, or design professional that the
29	claimant asserts is responsible for the defect, and should
30	provide the contractor, subcontractor, supplier, or design
31	professional with an opportunity to resolve the claim without
32	resort to further legal process.
33	Section 2.  Section 558.002, Florida Statutes, is amended
34	to read:
35	558.002  Definitions.--As used in this chapter, the term:
36	(1)  "Action" means any civil action or arbitration
37	proceeding for damages or indemnity asserting a claim for damage
38	to or loss of real a dwelling or personal property caused by an
39	alleged construction defect, but does not include any
40	administrative action or any civil action or arbitration
41	proceeding asserting a claim for alleged personal injuries
42	arising out of an alleged construction defect.
43	(2)  "Association" has the same meaning as in s.
44	718.103(2), s. 719.103(2), s. 720.301(9), or s. 723.075.
45	(3)  "Claimant" means a property owner homeowner, including
46	a subsequent purchaser or association, who asserts a claim for
47	damages against a contractor, subcontractor, supplier, or design
48	professional concerning a construction defect or a subsequent
49	owner who asserts a claim for indemnification for such damages.
50	The term does not include a contractor, subcontractor, supplier,
51	or design professional.
52	(4)  "Construction defect" means a deficiency in, or a
53	deficiency arising out of, the design, specifications,
54	surveying, planning, supervision, observation of construction,
55	or construction, repair, alteration, or remodeling of a
56	dwelling, any appurtenance to the dwelling, or the real property
57	to which the dwelling or appurtenance is affixed resulting from:
58	(a)  Defective material, products, or components used in
59	the construction or remodeling;
60	(b)  A violation of the applicable codes in effect at the
61	time of construction or remodeling which gives rise to a cause
62	of action pursuant to s. 553.84;
63	(c)  A failure of the design of real property a dwelling to
64	meet the applicable professional standards of care at the time
65	of governmental approval; or
66	(d)  A failure to construct or remodel real property a
67	dwelling in accordance with accepted trade standards for good
68	and workmanlike construction at the time of construction.
69	(5)  "Contractor" means any person, as defined in s. 1.01,
70	that is legally engaged in the business of designing,
71	developing, constructing, manufacturing, repairing, or
72	remodeling real property dwellings or attachments thereto.
73	(6)  "Design professional" means a person, as defined in s.
74	1.01, licensed in this state as an architect, interior designer,
75	landscape architect, engineer, or surveyor.
76	(7)  "Real property" or "property Dwelling" means land that
77	is improved and the improvements on such land, including
78	fixtures, manufactured housing, or mobile homes and excluding
79	public transportation projects a single-family house,
80	manufactured or modular home, duplex, triplex, quadruplex, or
81	other multifamily unit in a multifamily residential building
82	designed for residential use in which title to each individual
83	unit is transferred to the owner under a condominium or
84	cooperative system and includes common areas and improvements
85	that are owned or maintained by an association or by members of
86	an association, and also includes the systems, other components,
87	improvements, and other structures or facilities, including, but
88	not limited to, recreational structures or facilities, that are
89	appurtenant to and located on the real property on which the
90	house, duplex, triplex, quadruplex, or other multifamily unit is
91	located, but are not necessarily part of the structure at the
92	time of completion of construction.
93	(8)  "Service" means delivery by certified mail, return
94	receipt requested, to the last known address of the addressee.
95	(9)  "Subcontractor" means a person, as defined in s. 1.01,
96	who is a contractor who performs labor and supplies material on
97	behalf of another contractor in the construction or remodeling
98	of real property a dwelling.
99	(10)  "Supplier" means a person, as defined in s. 1.01, who
100	provides only materials, equipment, or other supplies for the
101	construction or remodeling of real property a dwelling.
102	Section 3.  Subsections (1), (2), (3), (4), (5), (8), (9),
103	and (14) of section 558.004, Florida Statutes, are amended to
104	read:
105	558.004  Notice and opportunity to repair.--
106	(1)  In actions brought alleging a construction defect, the
107	claimant shall, at least 60 days before filing any an action
108	involving a single-family home, an association representing 20
109	or fewer residential parcels, a manufactured or modular home, a
110	duplex, a triplex, or a quadruplex, or at least 120 days before
111	filing an action involving an association representing more than
112	20 parcels residential parcel owners, serve written notice of
113	claim on the contractor, subcontractor, supplier, or design
114	professional, as applicable, which notice shall refer to this
115	chapter. If the construction defect claim arises from work
116	performed under a contract, the written notice of claim must be
117	served on the person with whom the claimant contracted. The
118	notice of claim must describe the claim in reasonable detail
119	sufficient to determine the general nature of each alleged
120	construction defect and a description of the damage or loss
121	resulting from the defect, if known. The claimant shall endeavor
122	to serve the notice of claim within 15 days after discovery of
123	an alleged defect, but the failure to serve notice of claim
124	within 15 days does not bar the filing of an action, subject to
125	s. 558.003. This subsection does not preclude a claimant from
126	filing an action sooner than 60 days, or 120 days as applicable,
127	after service of written notice as expressly provided in
128	subsection (6), subsection (7), or subsection (8).
129	(2)  Within 30 days after receipt of the notice of claim
130	involving a single-family home, an association representing 20
131	or fewer residential parcels, a manufactured or modular home, a
132	duplex, a triplex, or a quadruplex, or within 50 days after
133	receipt of the notice of claim involving an association
134	representing more than 20 residential parcels, the person
135	receiving the notice of claim under subsection (1) is entitled
136	to perform a reasonable inspection of the property dwelling or
137	of each unit subject to the claim to assess each alleged
138	construction defect. An association's right to access property
139	for either maintenance or repair includes the authority to grant
140	access for the inspection. The claimant shall provide the person
141	receiving the notice under subsection (1) and such person's
142	contractors or agents reasonable access to the property dwelling
143	during normal working hours to inspect the property dwelling to
144	determine the nature and cause of each alleged construction
145	defect and the nature and extent of any repairs or replacements
146	necessary to remedy each defect. The person receiving notice
147	under subsection (1) shall reasonably coordinate the timing and
148	manner of any and all inspections with the claimant to minimize
149	the number of inspections. The inspection may include
150	destructive testing by mutual agreement under the following
151	reasonable terms and conditions:
152	(a)  If the person receiving notice under subsection (1)
153	determines that destructive testing is necessary to determine
154	the nature and cause of the alleged defects, such person shall
155	notify the claimant in writing.
156	(b)  The notice shall describe the destructive testing to
157	be performed, the person selected to do the testing, the
158	estimated anticipated damage and repairs to the property
159	dwelling resulting from the testing, the estimated amount of
160	time necessary for the testing and to complete the repairs, and
161	the financial responsibility offered for covering the costs of
162	repairs.
163	(c)  If the claimant promptly objects to the person
164	selected to perform the destructive testing, the person
165	receiving notice under subsection (1) shall provide the claimant
166	with a list of three qualified persons from which the claimant
167	may select one such person to perform the testing. The person
168	selected to perform the testing shall operate as an agent or
169	subcontractor of the person receiving notice under subsection
170	(1) and shall communicate with, submit any reports to and be
171	solely responsible to the person receiving notice.
172	(d)  The testing shall be done at a mutually agreeable
173	time.
174	(e)  The claimant or a representative of the claimant may
175	be present to observe the destructive testing.
176	(f)  The destructive testing shall not render the property
177	dwelling uninhabitable.
178
179	In the event the claimant fails or refuses to agree to
180	destructive testing, the claimant shall have no claim for
181	damages which could have been avoided or mitigated had
182	destructive testing been allowed when requested and had a
183	feasible remedy been promptly implemented.
184	(3)  Within 10 days after receipt of the notice of claim
185	involving a single-family home, an association representing 20
186	or fewer residential parcels, a manufactured or modular home, a
187	duplex, a triplex, or a quadruplex, or within 30 days after
188	receipt of the notice of claim involving an association
189	representing more than 20 residential parcels, the person
190	receiving the notice under subsection (1) may forward a copy of
191	the notice of claim to each contractor, subcontractor, supplier,
192	or design professional whom it reasonably believes is
193	responsible for each defect specified in the notice of claim and
194	shall note the specific defect for which it believes the
195	particular contractor, subcontractor, supplier, or design
196	professional is responsible. Each such contractor,
197	subcontractor, supplier, and design professional may inspect the
198	property dwelling as provided in subsection (2).
199	(4)  Within 15 days after receiving a copy of the notice of
200	claim pursuant to subsection (3) involving a single-family home,
201	an association representing 20 or fewer residential parcels, a
202	manufactured or modular home, a duplex, a triplex, or a
203	quadruplex, or within 30 days after receipt of the copy of the
204	notice of claim involving an association representing more than
205	20 residential parcels, the contractor, subcontractor, supplier,
206	or design professional must serve a written response to the
207	person who forwarded a copy of the notice of claim. The written
208	response shall include a report, if any, of the scope of any
209	inspection of the property dwelling, the findings and results of
210	the inspection, a statement of whether the contractor,
211	subcontractor, supplier, or design professional is willing to
212	make repairs to the property dwelling or whether such claim is
213	disputed, a description of any repairs they are willing to make
214	to remedy the alleged construction defect, and a timetable for
215	the completion of such repairs.
216	(5)  Within 45 days after receiving the notice of claim
217	involving a single-family home, an association representing 20
218	or fewer residential parcels, a manufactured or modular home, a
219	duplex, a triplex, or a quadruplex, or within 75 days after
220	receipt of a copy of the notice of claim involving an
221	association representing more than 20 residential parcels, the
222	person who received notice under subsection (1) must serve a
223	written response to the claimant. The response shall be served
224	to the attention of the person who signed the notice of claim,
225	unless otherwise designated in the notice of claim. The written
226	response must provide:
227	(a)  A written offer to remedy the alleged construction
228	defect at no cost to the claimant, a detailed description of the
229	proposed repairs necessary to remedy the defect, and a timetable
230	for the completion of such repairs;
231	(b)  A written offer to compromise and settle the claim by
232	monetary payment, that will not obligate the person's insurer,
233	and a timetable for making payment;
234	(c)  A written offer to compromise and settle the claim by
235	a combination of repairs and monetary payment, that will not
236	obligate the person's insurer, that includes a detailed
237	description of the proposed repairs and a timetable for the
238	completion of such repairs and making payment;
239	(d)  A written statement that the person disputes the claim
240	and will not remedy the defect or compromise and settle the
241	claim; or
242	(e)  A written statement that a monetary payment, including
243	insurance proceeds, if any, will be determined by the person's
244	insurer within 30 days after notification to the insurer by
245	means of forwarding the claim, which notification shall occur at
246	the same time the claimant is notified of this settlement
247	option, which the claimant can accept or reject. A written
248	statement under this paragraph may also include an offer under
249	paragraph (c), but such offer shall be contingent upon the
250	claimant also accepting the determination of the insurer whether
251	to make any monetary payment in addition thereto. If the insurer
252	for the person receiving the claim makes no response within the
253	30 days following notification, then the claimant shall be
254	deemed to have met all conditions precedent to commencing an
255	action.
256	(8)  If the claimant timely and properly accepts the offer
257	to repair an alleged construction defect, the claimant shall
258	provide the offeror and the offeror's agents reasonable access
259	to the claimant's property dwelling during normal working hours
260	to perform the repair by the agreed-upon timetable as stated in
261	the offer. If the offeror does not make the payment or repair
262	the defect within the agreed time and in the agreed manner,
263	except for reasonable delays beyond the control of the offeror,
264	including, but not limited to, weather conditions, delivery of
265	materials, claimant's actions, or issuance of any required
266	permits, the claimant may, without further notice, proceed with
267	an action against the offeror based upon the claim in the notice
268	of claim. If the offeror makes payment or repairs the defect
269	within the agreed time and in the agreed manner, the claimant is
270	barred from proceeding with an action for the claim described in
271	the notice of claim or as otherwise provided in the accepted
272	settlement offer.
273	(9)  This section does not prohibit or limit the claimant
274	from making any necessary emergency repairs to the property
275	dwelling as are required to protect the health, safety, and
276	welfare of the claimant. In addition, any offer or failure to
277	offer pursuant to subsection (5) to remedy an alleged
278	construction defect or to compromise and settle the claim by
279	monetary payment does not constitute an admission of liability
280	with respect to the defect and is not admissible in an action
281	brought under this chapter.
282	(14)  To the extent that an arbitration clause in a
283	contract for the sale, design, construction, or remodeling of
284	real property a dwelling conflicts with this section, this
285	section shall control.
286	Section 4.  Section 558.005, Florida Statutes, is amended
287	to 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
291	contract for the design, construction, or remodeling of real
292	property a dwelling entered into:
293	(a)  Between on or after July 1, 2004, and September 30,
294	2006, which contains the notice as set forth in paragraph (2)(a)
295	subsection (2) and is conspicuously set forth in capitalized
296	letters.
297	(b)  On or after October 1, 2006, which contains the notice
298	set forth in paragraph (2)(b) and is conspicuously set forth in
299	capitalized 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
305	CHAPTER 558, FLORIDA STATUTES, CONTAINS IMPORTANT REQUIREMENTS
306	YOU MUST FOLLOW BEFORE YOU MAY BRING ANY LEGAL ACTION FOR AN
307	ALLEGED CONSTRUCTION DEFECT IN YOUR HOME. SIXTY DAYS BEFORE YOU
308	BRING ANY LEGAL ACTION, YOU MUST DELIVER TO THE OTHER PARTY TO
309	THIS CONTRACT A WRITTEN NOTICE, REFERRING TO CHAPTER 558, OF ANY
310	CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE AND PROVIDE
311	SUCH PERSON THE OPPORTUNITY TO INSPECT THE ALLEGED CONSTRUCTION
312	DEFECTS AND TO CONSIDER MAKING AN OFFER TO REPAIR OR PAY FOR THE
313	ALLEGED CONSTRUCTION DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT
314	ANY OFFER WHICH MAY BE MADE. THERE ARE STRICT DEADLINES AND
315	PROCEDURES UNDER THIS FLORIDA LAW WHICH MUST BE MET AND FOLLOWED
316	TO PROTECT YOUR INTERESTS.
317	(b)  The notice required by paragraph (1)(b) must expressly
318	cite this chapter and be in substantially the following form:
319
320	CHAPTER 558 NOTICE OF CLAIM
321
322	CHAPTER 558, FLORIDA STATUTES, CONTAINS IMPORTANT REQUIREMENTS
323	YOU MUST FOLLOW BEFORE YOU MAY BRING ANY LEGAL ACTION FOR AN
324	ALLEGED CONSTRUCTION DEFECT. SIXTY DAYS BEFORE YOU BRING ANY
325	LEGAL ACTION, YOU MUST DELIVER TO THE OTHER PARTY TO THIS
326	CONTRACT A WRITTEN NOTICE, REFERRING TO CHAPTER 558, OF ANY
327	CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE AND PROVIDE
328	SUCH PERSON THE OPPORTUNITY TO INSPECT THE ALLEGED CONSTRUCTION
329	DEFECTS AND TO CONSIDER MAKING AN OFFER TO REPAIR OR PAY FOR THE
330	ALLEGED CONSTRUCTION DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT
331	ANY OFFER WHICH MAY BE MADE. THERE ARE STRICT DEADLINES AND
332	PROCEDURES UNDER THIS FLORIDA LAW WHICH MUST BE MET AND FOLLOWED
333	TO PROTECT YOUR INTERESTS.
334	(3)  After receipt of the initial notice of claim, a
335	claimant and the person receiving notice under s. 558.004(1)
336	may, by written mutual agreement, alter the procedure for the
337	notice of claim process described in this chapter.
338	(4)  This chapter applies to all actions accruing on or
339	after July 1, 2004, and all actions commenced on or after such
340	date, regardless of the date of sale, issuance of a certificate
341	of occupancy or its equivalent, or substantial completion of the
342	construction dwelling. Notwithstanding the notice requirements
343	of this section for contracts entered into between on or after
344	July 1, 2004, and September 30, 2006, this chapter applies to
345	all actions accruing before July 1, 2004, but not yet commenced
346	as of July 1, 2004, and failure to include such the notice
347	requirements of this section in a contract entered into prior to
348	July 1, 2004, does not operate to bar the procedures of this
349	chapter from applying to all such actions. Notwithstanding the
350	notice requirements of this section for contracts entered into
351	on or after October 1, 2006, this chapter applies to all actions
352	accruing before July 1, 2004, but not yet commenced as of July
353	1, 2004, and failure to include such notice requirements in a
354	contract entered into before July 1, 2004, does not operate to
355	bar the procedures of this chapter from applying to all such
356	actions.
357	Section 5.  This act shall take effect October 1, 2006.

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