Florida Senate - 2022                                     SB 736
       By Senator Hutson
       7-00786-22                                             2022736__
    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 on real
    6         property; amending s. 558.004, F.S.; requiring a
    7         claimant to include the reasons for rejecting an offer
    8         in a notice rejecting a settlement offer to remedy a
    9         construction defect; authorizing the person served
   10         with a notice rejecting a settlement offer to make a
   11         supplemental offer within a specified timeframe;
   12         providing notice requirements for a claimant who
   13         rejects a supplemental offer; requiring the court to
   14         stay an action if a claimant initiates an action
   15         without first accepting or rejecting a supplemental
   16         offer; limiting entitlement to attorney fees if a
   17         claimant rejects certain settlement offers to fully
   18         repair an alleged construction defect; requiring a
   19         claimant who accepts a certain offer to enter into a
   20         contract to complete repairs to remedy an alleged
   21         construction defect; requiring the offeror or insurer
   22         to pay the contractor or contractors directly for the
   23         repairs; prohibiting an offeror or insurer from
   24         requiring a claimant to advance payment for repairs;
   25         requiring that the repairs be completed within a
   26         specified timeframe; creating s. 558.0045, F.S.;
   27         requiring a court to appoint an expert to examine
   28         certain alleged construction defects and to prepare an
   29         examination report, under certain circumstances;
   30         requiring that the report contain specified
   31         information; requiring the parties to compensate the
   32         expert; prohibiting the expert from being employed to
   33         make repairs or from recommending contractors to make
   34         repairs; creating s. 558.0046, F.S.; requiring a
   35         claimant to repair a construction defect if the
   36         claimant receives compensation for an alleged
   37         construction defect from specified persons; providing
   38         that a claimant is liable for damages resulting from
   39         failure to disclose a construction defect to a
   40         purchaser of a property; creating s. 558.006, F.S.;
   41         requiring a claimant to serve certain notices relating
   42         to construction defects on the mortgagee or assignee
   43         of the relevant real property within a specified
   44         timeframe under certain circumstances; providing
   45         applicability; providing an effective date.
   47  Be It Enacted by the Legislature of the State of Florida:
   49         Section 1. Paragraph (c) of subsection (3) of section
   50  95.11, Florida Statutes, is amended to read:
   51         95.11 Limitations other than for the recovery of real
   52  property.—Actions other than for recovery of real property shall
   53  be commenced as follows:
   54         (3) WITHIN FOUR YEARS.—
   55         (c) An action founded on the design, planning, or
   56  construction of an improvement to real property, with the time
   57  running from the date of actual possession by the owner, the
   58  date of the issuance of a certificate of occupancy, the date of
   59  abandonment of construction if not completed, or the date of
   60  completion of the contract or termination of the contract
   61  between the professional engineer, registered architect, or
   62  licensed contractor and his or her employer, whichever date is
   63  latest; except that, when the action involves a latent defect,
   64  the time runs from the time the defect is discovered or should
   65  have been discovered with the exercise of due diligence. In any
   66  event, the action must be commenced within 10 years after the
   67  date of actual possession by the owner, the date of the issuance
   68  of a certificate of occupancy, the date of abandonment of
   69  construction if not completed, or the date of completion of the
   70  contract or termination of the contract between the professional
   71  engineer, registered architect, or licensed contractor and his
   72  or her employer, whichever date is latest. However,
   73  counterclaims, cross-claims, and third-party claims that arise
   74  out of the conduct, transaction, or occurrence set out or
   75  attempted to be set out in a pleading may be commenced up to 1
   76  year after the pleading to which such claims relate is served,
   77  even if such claims would otherwise be time barred. With respect
   78  to actions founded on the design, planning, or construction of
   79  an improvement to real property, if such construction is
   80  performed pursuant to a duly issued building permit and if a
   81  local enforcement agency, state enforcement agency, or special
   82  inspector, as those terms are defined in s. 553.71, has issued a
   83  final certificate of occupancy or certificate of completion,
   84  then as to the construction which is within the scope of such
   85  building permit and certificate, the correction of defects to
   86  completed work or repair of completed work, whether performed
   87  under warranty or otherwise, does not extend the period of time
   88  within which an action must be commenced. Completion of the
   89  contract means the later of the date of final performance of all
   90  the contracted services or the date that final payment for such
   91  services becomes due without regard to the date final payment is
   92  made.
   93         Section 2. Present subsections (8) through (15) of section
   94  558.004, Florida Statutes, are redesignated as subsections (9)
   95  through (16), respectively, a new subsection (8) is added to
   96  that section, and paragraph (c) of subsection (1) and subsection
   97  (7) of that section are amended, to read:
   98         558.004 Notice and opportunity to repair.—
   99         (1)
  100         (c) The claimant shall endeavor to serve the notice of
  101  claim within 15 days after discovery of an alleged defect, but
  102  the failure to serve notice of claim within 15 days does not bar
  103  the filing of an action, subject to s. 558.003. This subsection
  104  does not preclude a claimant from filing an action sooner than
  105  60 days, or 120 days as applicable, after service of written
  106  notice as expressly provided in subsection (6), subsection (7),
  107  or subsection (9) (8).
  108         (7)(a) A claimant who receives a timely settlement offer
  109  must accept or reject the offer by serving written notice of
  110  such acceptance or rejection on the person making the offer
  111  within 45 days after receiving the settlement offer.
  112         (b)If the claimant rejects the settlement offer, the
  113  claimant must include the reasons for rejecting the offer in the
  114  notice rejecting the offer. If the claimant believes that the
  115  settlement offer omitted reference to any portion of the claim
  116  or was unreasonable in any manner, the claimant must include in
  117  the notice the items that the claimant believes were omitted and
  118  state in detail all known reasons why the claimant believes the
  119  settlement offer is unreasonable.
  120         (c)Upon receipt of a claimant’s notice of rejection and
  121  the reasons for such rejection, the person served with the
  122  rejection, within 15 days after receipt of the notice, may make
  123  a supplemental offer of repair or monetary payment, or both, to
  124  the claimant.
  125         (d)If the claimant rejects a supplemental offer to repair
  126  the construction defect or to settle the claim by monetary
  127  payment or a combination of both, the claimant must serve
  128  written notice of the claimant’s rejection on the person making
  129  the supplemental offer. The notice must include all known
  130  reasons for the claimant’s rejection of the supplemental
  131  settlement offer.
  132         (e) If a claimant initiates an action without first
  133  accepting or rejecting the offer or supplemental offer, the
  134  court shall stay the action upon timely motion until the
  135  claimant complies with this subsection.
  136         (8)(a) If the claimant rejects a timely settlement offer or
  137  supplemental offer provided to remedy the alleged construction
  138  defect at no cost to the claimant, in any action brought for
  139  that defect, the claimant may not recover attorney fees from the
  140  offeror on any basis unless the claimant proves by a
  141  preponderance of the evidence that, at the time of the offer,
  142  additional repairs beyond those offered were necessary to remedy
  143  the defect. This paragraph does not apply to any claim for
  144  attorney fees based on a contract between the claimant and the
  145  offeror.
  146         (b) If a claimant accepts an offer made pursuant to
  147  paragraph (5)(b), paragraph (5)(c), or paragraph (5)(e) or a
  148  supplemental offer made pursuant to paragraph (7)(c), the
  149  claimant must, within 90 days after the acceptance, enter into a
  150  contract with one or more appropriately licensed contractors to
  151  complete the repairs necessary to remedy the alleged
  152  construction defect. The offeror or insurer shall pay directly
  153  to the contractor or contractors, from the accepted monetary
  154  payment, the amounts necessary to begin and to continue the
  155  repairs as the work is performed and expenses are incurred. The
  156  offeror or insurer may not require the claimant to advance
  157  payment for the repairs. The repairs must be completed within 12
  158  months after the claimant enters into the contract for repairs,
  159  absent mutual agreement between the offeror or insurer and the
  160  claimant.
  161         Section 3. Section 558.0045, Florida Statutes, is created
  162  to read:
  163         558.0045 Construction defect actions; attorney fees and
  164  costs.—
  165         (1) In a civil action alleging a construction defect, the
  166  court shall appoint an engineer, a contractor, a building code
  167  inspector, or another expert having experience in the type of
  168  construction that is the basis of the claimant’s claim to
  169  examine the alleged defect or, if repairs have been made, any
  170  evidence of the alleged defect. However, the court may not
  171  appoint an expert if all of the parties object or if the court
  172  finds that the costs of an expert outweigh any potential
  173  benefits to the resolution of the action. If an expert is
  174  appointed, the expert must coordinate and communicate with the
  175  parties as directed by the court. Within 15 days after
  176  conducting the examination, or as otherwise determined by the
  177  court, the expert shall submit a written report to the court for
  178  its consideration and to the parties which contains the expert’s
  179  findings. The report must do all of the following:
  180         (a) Describe how the expert conducted the examination of
  181  the alleged defect.
  182         (b) Identify persons present at the site of the improvement
  183  while the expert conducted the examination.
  184         (c) Include photographs or other documentation of the
  185  alleged defect including any relevant test results.
  186         (d) State whether the damages claimed by the claimant are
  187  more likely than not the result of a construction defect,
  188  another identified cause, or a construction defect and another
  189  identified cause.
  190         (e) Address other matters related to the alleged defect as
  191  directed by the court.
  192         (2) If the expert concludes that the damages are wholly or
  193  partially the result of a construction defect, the report must
  194  state the actions necessary to repair the defect and any repairs
  195  related to the defect, provide an estimate of the reasonable
  196  cost of repairs, and state the anticipated time needed for
  197  repairs under the current market conditions for construction
  198  services and materials.
  199         (3) The parties shall compensate the expert, but the
  200  prevailing party is entitled to reimbursement from the
  201  nonprevailing party.
  202         (4) An expert appointed by the court under this section may
  203  not be employed to repair the alleged defect or recommend
  204  contractors to repair the defect.
  205         Section 4. Section 558.0046, Florida Statutes, is created
  206  to read:
  207         558.0046 Duty to repair construction defect.—If a claimant
  208  receives compensation for an alleged construction defect from a
  209  contractor, a subcontractor, a supplier, a design professional,
  210  or an insurer, the claimant must repair the defect. A claimant
  211  who receives compensation and fails to fully repair the defect
  212  is liable to a purchaser of the property for any damages
  213  resulting from the failure to disclose the defect.
  214         Section 5. Section 558.006, Florida Statutes, is created to
  215  read:
  216         558.006 Notice to mortgagee or assignee.—
  217         (1)If a notice of claim alleging a construction defect is
  218  made with respect to real property to which a mortgagee or an
  219  assignee has a security interest, the claimant must, within 30
  220  days after service of the notice of claim on the contractor,
  221  subcontractor, supplier, or design professional, provide the
  222  mortgagee or assignee with a copy of the notice of claim, by
  223  certified mail, return receipt requested.
  224         (2)If repairs relating to the defect are completed after
  225  the claimant notifies the mortgagee or assignee as required
  226  under subsection (1), or if any settlement, partial settlement,
  227  arbitration award, or judgment is obtained by the claimant, the
  228  claimant must provide an additional notice to the mortgagee or
  229  assignee within 60 days after completion of the repairs or any
  230  settlement, partial settlement, arbitration award, or judgment,
  231  whichever is later, by certified mail, return receipt requested.
  232         Section 6. (1) The amendments by this act to s.
  233  95.11(3)(c), Florida Statutes, apply to any action commenced on
  234  or after July 1, 2022, regardless of when the cause of action
  235  accrued. However, any action that would not have been barred
  236  under s. 95.11(3)(c), Florida Statutes, before the amendments
  237  made by this act to that section may be commenced before July 1,
  238  2023. If such action is not commenced by July 1, 2023, and is
  239  barred by the amendments made by this act to s. 95.11(3)(c),
  240  Florida Statutes, the action is barred.
  241         (2) Sections 2 through 5 of this act apply to compensation
  242  for construction defects received on or after July 1, 2022, and
  243  to civil actions and proceedings for a construction defect which
  244  are initiated on or after July 1, 2022.
  245         Section 7. This act shall take effect July 1, 2022.