In Florida, there are currently two (2) key benchmark periods for claims to be made against parties regarding construction defects and an Architect’s reasonable Standard of Care.
1-Statute of Limitations– §95.11(3)(c); Imposes a four (4) year term that “patent”, obvious construction defects and deficiencies can be claimed, based on the following criteria:
- Actual possession by the Owner
- Date of the issuance of a Certificate of Occupancy
- Date of Abandonment of construction, if not completed
- Date of completion or termination of the contract between Owners and engineer(s),architect and/or prime contractor.
2-Statute of Repose– §95.11(3)(c); Imposes a ten (10) year term that involves “latent”, hidden defects and or claims against a professional or contractor related to planning, design, and or construction. Generally, this refers to issues which had not been manifested in the first four years. This Repose period of beginning liability is the same as the Statute of Limitations depending on the application of the four criteria.
Therefore, the importance of the “win” this year on the Amended definition of HB 377 was stipulating when the potential claim period will begin. Previously, Item (d) above allowed an Owner to “play games” with the completion of the Architect’s contract, by possibly delaying final payment to the Architect, if legal action was under consideration.
NOW, on July 1, 2017, when the Governor signed into Law HB 377, the Amendment to Section 95.11(3)(c) 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 those services becomes due.” This clarified (d) above to our benefit.
This HB 377 clarification prevents an Owner’s delay in making a final payment, for whatever reason, a tactic to possibly extend an Architect’s liability for construction defects in either the Limitations or Repose Statutes.
1-Caution-Architects must make sure that every Proposal, Agreement and/or Letter of Engagement that you have authored or signed, stipulates clearly when your final services performed are complete and …not on the receipt of FINAL PAYMENT. Also, clearly identify when final payment for those services will be due, not tied to final services! (It is recommended that you check with legal counsel and your E&O Carrier for appropriate consistent language).
2-There are other interacting Florida Statutes which may be influenced by this HB 377 Amendment such as the special Condominium Statutes.
3-Be careful if a project design is delayed and lies dormant for a period, as is unfortunately the case many times, to again clarify, when final payment is due as the project is revived.
4-Remember this is a litigious world and a “handshake or quick cover letter” for professional services, will not help you effectively in a law-suit.
For more information contact David Chase at (561) 430-1722.