Business and Legal Insights

In Florida, the allowed timeframe for bringing a lawsuit based either on a defect in the design, planning, or construction of a building or based on other improvements to real property is governed by Fla. Stat. § 95.11(3)(c).  The Florida Legislature recently passed House Bill 875, effectively amending Fla. Stat. § 95.11(3)(c).  Chapter 18-97, Florida Laws, provides that the amendments discussed herein became effective on July 1, 2018.

Notably, the year prior to the amendments discussed herein, the Florida Legislature amended Fla. Stat. § 95.11(3)(c) to define “completion of the contract” as “the later 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 was made.”   Fla. Stat. § 95.11(3)(c) (2017).  However, the 2017 amendments did not define “final performance.”

Therefore, Fla. Stat. § 95.11(3)(c) has been amended to include a provision that directly address the issues surrounding the interpretation of “final performance.”  Specifically, Fla. Stat. § 95.11(3)(c) now includes the following language:

With respect to actions founded on the design, planning, or construction of an improvement to real property, if such construction is performed pursuant to a duly issued building permit and if a local enforcement agency, state enforcement agency, or special inspector, as those terms are defined in s. 553.71, has issued a final certificate of occupancy or certificate of completion, then as to the construction which is within the scope of such  building permit and certificate, the correction of defects to completed work or repair of completed work, whether performed under warranty or otherwise, does not extend the period of time within which an action must be commenced.

Fla. Stat. § 95.11(3)(c) (2018).  This new language makes it clear that in relation to completed work, the correction of defects or deficiencies or completion of warranty obligations does not extend the time to bring a claim by tolling the limitations period.

The second 2018 amendment to Fla. Stat. § 95.11(3)(c) specifically relates to statute of repose.  The new language provides:

However, counterclaims, crossclaims, and third-party claims that arise out of the conduct, transaction or occurrence set out or attempted to be set out in a pleading may be commenced up to 1 year after the pleading to which such claims relate is served, even if such claims would otherwise be time barred.

Fla. Stat. § 95.11(3)(c) (2018).  This means, for example, that when a plaintiff brings an action on the eve of the expiration of the statute of repose, the defendant now has the benefit of a one-year extension of the statute of repose to investigate the need to bring claims against other parties.

Importantly, this extension runs from the time a party is served, not from when the action is filed.  Chapter 18-97, Florida Laws, provides that for actions instituted prior to July 1, 2018, any counter, cross, or third-party claim must be commenced before July 1, 2019 and any action that would not have been barred prior to the recent amendments may be commenced before July 1, 2019 or will otherwise be barred.

Time will tell if the 2018 amendments to Fla. Stat. § 95.11(3)(c) will provide more clarity regarding the timeliness of construction-related law suits and result in a decrease in litigation related thereto.