Changes Are Coming to Construction Defect Laws

Proposed Legislative Changes to 558 & the Statute of Repose

America’s Founders in 1776 desired change – change in their government and the laws affecting them and their businesses. They used the power of the pen to craft a representative government where positive change could be made by those willing to serve at the forefront of issues facing their community.

Construction is our community, and we have always served at the forefront of positive change, particularly legislative change. Our legal professionals serve on and participate in legislative committees of the Florida Bar and the major construction trade associations, such as Florida Homebuilders Association and Associated Builders and Contractors.

We are a part of the bill drafting process and speak with legislators and their staff about important issues affecting the construction industry. We do not sit on the sidelines, complain about the process, and wait for a response; we go on the offensive to take action.

Desperate for Change | Senate Bill SB 736

On November 2, 2021, Senator Hutson from District 7 filed a Senate bill known as SB 736. This bill can bring much needed change to the Construction industry as follows:

Amends 95.11

Amends § 95.11(3)(c) Fla. Stat. to eliminate the extended (or tolling) statute of limitations for actions founded on the design, planning, or construction of an improvement to real property based upon latent defects and eliminates the 10-year statute of repose.

Under the current statute, when the action involves a latent construction defect, the time runs from the time the defect is discovered or should have been discovered with the exercise of due diligence.

The current statute includes a 10-year statute of repose such that the action must be commenced within 10 years after the date of actual possession by the owner, the date of the issuance of a certificate of occupancy, the date of abandonment of construction if not completed, or the date of completion of the contract or termination of the contract between the professional engineer, registered architect, or licensed contractor and his or her employer, whichever date is latest.
This proposed revision eliminates the 10-year period, effectively reducing the deadline to file a claim to 4 years.

AMENDS 558.004

Amends the Florida Construction Defects Statute, specifically § 558.004 Fla. Stat., by adding the following provisions:

Requires a claimant who rejects a settlement offer to include the reasons for rejecting the offer within the notice rejecting the offer. The claimant must identify any items that were omitted from the offer and state in detail all known reasons why the claimant believes the settlement offer is unreasonable.
Allows the person served with a notice of rejection of a settlement offer 15 days to make a supplemental offer and requires the claimant to serve a notice of rejection of this supplemental offer, including reasons for the rejection.
Extends the court’s stay of any action until the supplemental process is concluded.
Limits claimant’s right to recover attorney’s fees unless the claimant proves by a preponderance of the evidence that, at the time of the offer, additional repairs beyond those offered were necessary to remedy the defect. Also, the attorney’s fee limitation does not apply to any claim for attorney’s fees based on a contract between the claimant and the offeror.
If a claimant accepts an offer or supplemental offer, the claimant must, within 90 days after the acceptance, enter into a contract with one or more appropriately licensed contractors to correct the construction defect(s). The offeror or insurer shall pay the contractor directly for said repairs and the repairs must be completed within 12 months after claimant enters into the contract with the contractor, unless the offeror or insurer and claimant mutually agree otherwise.
Creates a new § 558.0045 Fla. Stat., which requires the court, in construction defect litigation, to appoint an expert (e.g. engineer, contractor, etc.) to examine the alleged defect. The court may not appoint an expert if all the parties object or if the court finds that the cost of the expert outweighs any potential benefits to resolution of the action. Within 15 days after conducting the examination, or otherwise determined by the court, the expert shall submit a written report with detailed findings to the court and to the parties. The parties shall compensate the expert, but the prevailing party is entitled to reimbursement from the non-prevailing party. The expert may not be employed to do the repairs.
The claimant must repair a construction defect if claimant receives full compensation for such a repair. If a claimant receives full compensation and fails to repair the construction defect, claimant is liable to a purchaser of the property for any damages resulting from the failure to disclose the defect.
Requires the claimant to serve a notice of claim for any construction defect, by certified mail, return receipt requested, on a mortgagee or assignee within 30 days after service of the notice of claim upon the contractor, subcontractor, supplier or design professional. If repairs relating to the defect are completed after notice to a mortgagee or assignee is provided, or if any settlement, partial settlement, arbitration award, or judgment is obtained by the claimant, the claimant must provide an additional notice to the mortgagee or assignee, by certified mail, return receipt requested, within 60 days after completion of the repairs or any settlement, partial settlement, arbitration award, or judgment, whichever is later.

What Happens if it passes?

If passed by the legislature, it is important to note these amendments are effective for any action commenced on or after July 1, 2022. However, with respect to any action that would not have been barred under § 95.11(3)(c) Fla. Stat., which is the discovery rule statute of limitations for latent construction defects or 10-year statute of repose, such an action must begin on or before July 1, 2023.

We are encouraged at Team Z, as we see the potential for positive change for our clients. SB 736 is a piece of that potential change, despite being only in its earliest form of a pre-filed bill. Every year, there are competing, and complimentary bills filed. This bill has to make it through the legislative process, as bills advance, modify, negotiate, or die in committee, on its journey to make it to the governor’s desk to be signed into law. Team Z will do all we can to stand for our clients and for their pursuit of happiness.

If you would like more information about the pending legislation, or what you can do to protect your construction company from construction defect claims, Zinzow Law is here to help. We protect those who Build America.

Urgent Legal Bulletin | OSHA Vaccine Mandate

How to Beat an Overreaching Government

What Every Construction Company with More than 100 Employees Must Know Now

You have no doubt heard about the vaccine mandate, about Governors, including Governor Ron Desantis, who intend to challenge it, and may have even heard, in passing, about a court halting the vaccine mandate. This legal bulletin separates the fact from the fiction and provides you with important information you must know to protect your liberty and your livelihood.

Crafted by the Framers at the Constitutional Convention of 1787, the preamble of the Constitution begins with “We the People,” a phrase that has transcended American history. A noble phrase, combined with deep emotion and patriotism, breathes life into the fabric of our nation’s fundamental values that the people have the popular sovereignty over the government.

On September 9, 2021, President Biden issued his “Path Out of the Pandemic” memorandum and Executive Order 14042 to the American people, which broke our nation’s centuries long value that We the People decide what is best and not the government. Through the Occupational Health and Safety Act (OSHA), the President is mandating that businesses with over 100 employees must be fully vaccinated against COVID-19 or be subject to weekly COVID-19 testing, while wearing a mask during work hours. Additionally, the Federal government is initiating a rarely-used emergency temporary order (ETS) to streamline this executive overreach onto the American people.

Temporary Stay

On November 6, 2021, the Fifth Circuit Court of Appeals temporarily blocked the OSHA mandate from depriving freedom from hard-working Americans. A three-judge panel issued an emergency stay to prevent the enforcement of the new rule to allow for full briefing and arguments on the merits of the case.

Regardless, companies with over 100 employees need to be prepared for a legal fight, as the administration will attempt to unconstitutionally justify its means to reach its end, and this stay is temporary only.

False Justification of Using OSHA

OSHA’s purpose is to ensure workplace and jobsite safety, yet this executive order is political in-nature and does not specifically relate to either. OSHA is being used as a catalyst to further enhance the administration’s agenda to mandate vaccines and to further enhance the Federal government’s grip on American daily life.

While OSHA, a bureaucratic agency, typically takes seven years to create a rule for the workplace, the President’s executive order has been fast-tracked to be fully implemented in just four months. The emergency temporary order has only been issued nine times since it was established in 1971. Of the nine issuances, six were challenged in court and only one order survived the legal system. Each of these challenged orders governed the healthcare facility setting where protecting against medical dangers is a more compelling interest. This remarkable shift in rule-making expands this regulatory overreach to every business with over 100 employees in every sector of our economy.

The agency’s justification to use the ETS is to address a “grave danger,” but this legal standard cannot be upheld. This ETS order affects all employees at any age, whereas the country has been informed from the initial COVID-19 lockdowns in March 2020 through present day, that mostly the elderly were at risk of the disease. Even in the agency’s own conclusions, OSHA reaffirmed that not all workplaces face this grave danger. This grave danger notion is another illegal justification to directly interfere in the lives of everyday Americans.

Right to Privacy

It has been established through the Federal judiciary and legislature that the role of government in the lives of private citizens is to be limited. The right to privacy was established by the Supreme Court of the United States in Griswold vs Connecticut (1965), which has been used as case precedent expanding to other areas of private life. Additionally, Congress has taken the issue of privacy in the healthcare sphere to a vote, as it did in 1996 with the Health Insurance Portability and Accountability Act (HIPPA). HIPPA created national standards that protected patient information from being disclosed without the patient’s consent or knowledge.

The OSHA executive order immediately puts an individual’s choice on display to others. The employee can either comply with the order to obtain the vaccine, which automatically lets the individual enjoy normal life in the workplace, or the individual can subject him or herself to weekly testing and mask adherence. Regardless of the choice, colleagues in the workplace know the individual choice of the employee. This forced disclosure of health information by display breaks the legal standard our nation’s legislature and judiciary has already decided.

Be Ready to Defend Your Company

The OSHA mandate will be enforced through OSHA’s Compliance Safety and Health Officers. OSHA will issue a Citation but is historically required to give the contractor a reasonable time within which to cure (abate) the violation, though that will not eliminate the penalty if one is assessed. The abatement period specified by OSHA is often unreasonable, but contractors may petition for modification of the abatement date. The petition must include a number of details, such as steps taken to abate the issue by that point, the additional time needed, interim steps implemented to safeguard employees during the abatement period, and a certification that the petition for modification has been posted in a manner visible to the contractor’s employees. This petition must be timely filed or the contractor will have waived its right to seek modification.

The contractor may also wish to contest the Citation in whole or in part. This may be necessary and prudent because an uncontested Citation may lead to more frequent OSHA inspections and increased fines in the event of future violations. A Citation may be contested in only two ways: (1) an informal conference and (2) a formal notice of contest. A formal notice of contest must be initiated with the Assistant Regional Director within fifteen business days of the Citation. The informal conference does not have any impact on that deadline, so if an informal resolution is to be reached, the contractor must initiate the informal conference quickly. The contractor has the right to and should be represented by counsel during both an informal conference and the formal contest proceeding.

The contest proceeding is a formal legal process before the OSHA Review Commission, with a presiding Administrative Law Judge. OSHA will be represented by legal counsel throughout the proceeding. These proceedings are governed by complex rules of procedure and standards. At conclusion of that proceeding, the Administrative Law Judge will prepare a written decision which may be appealed to the appropriate federal circuit court.

Conclusion

Our country’s founding in 1776 occurred because our colonial past prevented the free expression of choice; the British crown dictated life by government mandates that were not consented to by the governed. Our Founders sacrificed their lives, fortunes, and sacred honor so we, as Americans, could live in a country full of peace, joy, and liberty. The Framers of the Constitution wrote a perpetual reminder to succeeding generations that “We the People” represent the people’s values. And those three words established what our Constitutional Republic was to embody. We the People can choose our leaders. We the People can choose our careers. We the People can choose our own health decisions. It is not the role of the government to dictate how Americans make individual choices; it’s the people’s.

Thankfully our Constitution affords the construction industry relief from the terrible cost a universal vaccine mandate will place on an already strained labor force.

If you would like more information about the OSHA mandate, the temporary stay, or what you can do to protect your construction company from an OSHA citation, Zinzow Law is here to help. We protect those who Build America.

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