Senators are planning to consolidate the period to allow homeowners to sue over construction defects.
As currently written, St. Augustine Republican Sen. Travis Hutson's bill (SB 736) would provide a five-year repose period for a single-family residence and would retain the existing 10-year repose period for all other improvements. However, a proposed amendment would set a seven-year repose period for all types of improvements but would allow longer time periods when defects have been fraudulently concealed.
For cases involving fraudulent concealment, homeowners would have 10 years to file over a defect and no limit on filing over a defect to an improvement. In both cases, the claim would have to be filed within a year of discovering the fraudulent concealment.
Senators are expected to consider the amendment Thursday when they take up the bill on the Senate floor. Similar bills have been filed in recent years, but the measure has never passed into law.
In a statement Wednesday, Hutson said construction defects can be devastating to a family's physical safety and their financial security. Homes can be a family's largest financial investment.
"It is important that our laws protect people's investments in their homes and establish a clear and fair process for addressing a construction defect," Hutson said.
Currently, the Florida Building Commission sets the definition for a material violation as part of the Florida Building Code. However, the Senate amendment and the House bill (HB 583) from Jacksonville Republican Rep. Clay Yarborough, which awaits a hearing in its final committee, seek to define material violations in statute.
Both definitions would encompass violations within completed structures that have or may reasonably result in physical harm to a person or "significant damage" to the building's performance. Meanwhile, the House bill still ties material violations to the Florida Building Code and considers significant damage to a building.
Cosmetic, minimal or overall inconsequential violations to the Florida Building Code wouldn't qualify for a claim. Damage costing 25% or more of the building's market value would qualify as significant damage.
For every serious construction defect claim, predatory actors seeking big paydays file dozens more, Hutson said.
The amendment also seeks to strengthen the claims-filing process by requiring the owner of an improvement to provide the builder with an inspection report from an expert who has investigated, documented and validated the owner's concerns. Having more information about the repairs necessary could help resolve a construction defect dispute without going to court.
"Frivolous construction defect claims drive up the cost of insurance paid by homebuilders and their subcontractors," Hutson said. "That hidden cost is passed on to the consumer in the form of higher housing costs."
Speaking earlier this Session, Senate President Wilton Simpson told reporters he has heard complaints from contractors that their insurance rates have risen dramatically over recent years. Insurers won't write policies if the system doesn't weed out fraud.
"I do believe there's a lot of fraud that goes on the longer you are allowed as a building owner or a homeowner to go back against the general contractor," Simpson said.
Unlike the seven-year period established in the senate amendment, the House bill leaves a four-year statute of limitations that begins 45 days after an improvement is completed or abandoned. Homeowners would have seven years to file for a latent, or hidden, defect from the initial 45-day period. For cases in which a homeowner has clear and convincing evidence that an engineer, architect or contractor had knowledge of a material violation, the homeowner would have 15 years after the 45-day period to sue.
Senators will likely amend their version Thursday and could immediately vote to pass the bill.
"I'm glad that this year we've been able to bring a well-balanced product to the floor, striking the right balance to protect homeowners from fraudulent builders, while at the same time putting in place guardrails to ensure that homebuyers will be able to buy a more affordable home," Hutson said.
