Implications of Senate Bill 360 on the Construction Industry

Senate Bill 360, which was recently signed into law on April 13, 2023, could significantly impact construction defect litigation relating to improvements to real property. Specifically, the proposed bill shortens both the statute of limitations (“SOL”), and statute of repose (“SOR”), and further narrows the scope of statutory civil actions against builders for violations of Florida Building Code.

CS/SB 360 has revised or provided the following:
1) Commencement of the 4-year (patent defect) SOL by changing the potential commencement date and causing the statute to run based on whichever date is earliest instead of latest;
2) Shortens the 10-year (latent defect) SOR to 7 years;
3) Commencement of the 7-year SOR by changing the potential commencement dates and causing the statute to run based upon whichever date is earliest instead of latest;
4) If a newly constructed single-dwelling residential building is used as a model home, the time to bring a construction defect claim action begins to run from the date that a deed is recorded first transferring title to another party;
5) If the project involves the construction of multiple buildings, each individual building must be considered its own improvement for purposes of determining the limitations period;
6) Defines a “material violation” in connection with statutory civil actions against builders for alleged Florida Building Code violations, and amends existing law to limit recovery for material violations only; and
7) Includes a savings clause to ensure that claimants having remaining time under the existing SOL have at least 1 year from the effective date of the bill to initiate a construction defect claim.

Statutes of Limitation and Repose

The effective revisions relating to the 4-year (patent defect) SOL for construction defects are:
o Deleting “the date of actual possession by the owner” as a commencement date;
o Adding the date that “the authority having jurisdiction issues a temporary certificate of occupancy” as a commencement date;
o Adding the date that the authority having jurisdiction issues a “certificate of completion” as a commencement date; and
o Removing the date of completion or termination of the contract between the professional engineer, registered architect, or licensed contractor and his or her employer as a commencement date.

Additionally, the revision reflects that the 7-year (latent defect) SOR begins to run on any of the listed commencement dates, whichever date is earliest.

The revision replaces a reference in the statute to “a local enforcement agency, state enforcement agency, or special inspector,” with a reference to the “authority having jurisdiction.” The terminology is revised to be consistent with current practices for the issuance of certificates of occupancy or completion.

The revision further provides that if a newly-constructed single-dwelling residential building is used as a model home, the time for a construction defect action begins to run from the date that a deed is recorded first transferring title to another property.

Additionally, notwithstanding any provision of the statute to the contrary, if the improvement to real property consists of the design, planning, or construction of multiple buildings, each building must be considered its own improvement for purposes of determining the applicable limitations period in the bill.

Florida Building Code

CS/SB 360 narrows the scope of violation of Florida Building Code causes of action by:
o Amending Fla. Stat. §553.84 to limit recovery for material violations only; and
o Defines the term “material violation” to mean a Florida Building Code violation that exists within a completed building, structure, or facility which may reasonably result, or has resulted, in physical harm to a person or significant damage to the performance of a building or its systems.

Existing law requiring a local enforcement agency to impose a fine on a builder of $500 to $5,000 for failing to correct a material violation within a reasonable time has not been amended.

Savings Clause

Lastly, the revision applies to any construction defect action commenced on or after the effective date of the bill (July 1, 2023), regardless of when the cause of action accrued, except that any action that would not have been barred by the statute before that date must be commenced by July 1, 2024. Claimants who have time remaining under the existing SOL have at least 1 year from the effective date of the bill to initiate a construction defect action. Although, if the action is not commenced by July 1, 2024, and is barred by the amendments made by the revision, then the action is barred.

If you have any questions about the statute of limitations, statute of repose, or how SB 360 may affect you or your company, please contact Todd Haskel of CSK’s construction group at Todd.Haskel@csklegal.com or 831.864.9321.