The time for bringing a lawsuit for latent construction defects in Florida just got a little tighter. On June 14, 2017, Governor Rick Scott approved a change to tighten up Florida’s Statute of Repose, which bars lawsuits after 10 years from the later date of the owner taking possession, the issuance of a certificate of occupancy, the abandonment of construction, or the completion of the contract.
The change in the law attempts to fix an ambiguity created by the Fifth District Court of Appeal’s holding in Cypress Fairway Condo. v. Bergeron Const. Co. Inc., 164 So. 3d 706 (Fla. 5th Dist. App. 2015). That court held that the contract was complete when both parties completed their obligations, including when the owner paid the contractor for its work. The ruling effectively permitted owners to extend their time for filing lawsuits by withholding payment to construction professionals, even if the withholding is improper under the contract.
The new law defines completion of the contract as “the later of the date of final performance of all the contracted services or the date that final payment for such services becomes due without regard to the date final payment is made.” While this change does prevent an owner from wrongfully withholding payment to his or her advantage, it still leaves the door open for a debate about when the final payment “becomes due.” An earlier proposed version of this law might have eliminated this uncertainty by tying the completion date to the last date the contractors or design professionals furnished labor, services, or materials to the project. See 2017 Florida House Bill No. 377, Florida One Hundred Nineteenth Regular Session, Jan. 23, 2017. However, the Civil Justice & Claims Subcommittee amended this proposal in favor of the current version before House approval.
The new law, codified in Section 95.11(3)(c), Florida Statutes (2017), applies to all causes of action that accrue on or after July 1, 2017.
Kevin Reali contributed to this report.