2017 Proposed Legislative Changes

Unfortunately for homeowners in Florida, the Legislature is not terribly friendly to them when it comes to protecting what is usually the biggest investment a person will ever make. This has resulted in homeowners’ rights slowly eroding over the years. In 2006, for example, the Legislature proposed, and the Governor signed, a bill that decreased the statute of repose from 15 years to 10 years (Laws of Florida, ch. 2006-145). This meant that overnight homeowners had 5 less years to discover and bring suit against builders for hidden defects.

In 2011, the Legislature made sweeping changes to the sinkhole statutes that eviscerated most claims for sinkhole activity and made it so that only homes experiencing the most severe damage were covered by insurance. Those with confirmed sinkhole activity under their home, suffering only moderate damage, were no longer afforded insurance coverage. The Governor made that a law on May 17, 2011 (Laws of Florida, ch. 2011-39).

In 2015, the Legislature proposed a bill (HB 501) that would have reduced the statute of repose from 10 years to 7 years on construction defect cases. Thankfully, after strong opposition and outcry from homeowners, that measure died in committee.

This year, the Legislature is at it again. Senator Kathleen Passidomo (R-Naples) recently proposed Senate Bill 1164, a multi-pronged attack on homeowners. SB 1164 does not seek to simply reduce time periods for certain homeowners. It seeks to eliminate certain claims entirely.

The first major proposal is to § 95.11, Fla. Stat., the limitation of actions statute. The changes would completely deny subsequent purchasers of homes the right to bring construction defect claims if the buyer purchases the property “as-is.” The term “as-is” is not defined in the bill and it is not entirely clear what properties would fall under that heading, but builders will probably argue that all homes are purchased from the original owner “as-is.” It is possible that the term is just meant to cover foreclosure homes bought at auction. Regardless of how that term is ultimately defined, if the bill passes, builders will get a free pass for certain homes that were not built to the standards set by the Florida Building Code. Imagine purchasing a home only to discover a few years later that the exterior of your home was not built to code. Under SB 1164, it is possible that you would be unable to do anything about it. The proposed bill does give a one year “grandfathering” clause that permits suits on these “as-is” homes on or by July 1, 2018. Of course, that has little impact on those homeowners who have hidden defects that have simply not manifested yet in the form of cracking or obvious water intrusion.

The second major proposal is to § 558.004, Fla. Stat., which sets out the pre-suit litigation process for construction defect cases. This proposal would drastically change the way that the pre-litigation process works. It would require a homeowner to sign the letter putting the builder on notice of the building code defects and more importantly, would require a homeowner or homeowner’s agent (attorney) to by present with their retained expert for the inspection conducted by the builder. Presumably, the homeowner would be required to pay for the costs of his or her expert to be present.

Additionally, under the current pre-litigation procedure, the builder can make an offer to repair the property and/or offer money for repairs and the homeowner is free to reject the offer and proceed to court or arbitration. Under the proposed bill, the homeowner cannot simply reject the offer, but must demand mediation explaining why he or she considers the offer inadequate and must serve a written demand for mediation before filing suit.

Most importantly, the new § 558.004 statute states that the service of a notice of claim does not toll any applicable statute of repose. The very first sentence of § 558.004, Fla. Stat., however, states that a notice of claim must be filed at least 60 days before filing any action. What, then, is to be done on homes where building code violations manifest at the 9 year 11 month mark? A mediation would take the process outside of the statute of repose period, meaning that the case would be barred. The result would be that homeowners would have to file suit to protect themselves from the statute of repose, thus defeating the whole point of the pre-suit mediation process (to avoid the cost of filing suit and to free up court resources).

Please contact your local legislator to let him or her know that you oppose SB 1164.


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