Press enter to begin your search

Why Should the Condominium Association Require Bonds from the Renovation Contractor

               We often encounter Condominium Associations who have difficulty understanding why they should bond their exterior renovation contract.   Many Associations consider it money wasted on another layer of liability protection when they would rather spend the money on actual scope – sticks, bricks, and finishes. They do not expect the surety to pay the claims even if they are made against the Contractor’s Performance and Payment Bonds.  Association Boards often ask, “Isn’t the risk already covered by all the insurance required from the Contractor?” The short answer is, “No”, and here’s why.             A performance bond, unlike insurance, assures the Association that the Contractor, or its Surety, will complete the project even if the contractor goes bankrupt or cannot competently perform to complete the contract. In addition, sometimes a Surety can be required to pay Association claims for work not properly performed even after occupancy. See, Federal Ins. Co. v. The Southwest Florida Retirement Center, Inc.,...

HB 1013 signed by Governor Scott

Governor Scott signed HB 1013 into law late last week.  The legislation will take effect on July 1, 2012, and attempts to wipe out all common law implied warranties, including for pending litigation.  I think there are significant constitutional issues as applied to pending claims. We may find out quickly as the Lakeview v. Maronda case is still pending before the Supreme Court.  The Court may be able to address the scope of the warranty and also the constitutionality issue at one time. It will be an interesting decision but may be one of limited value going forward....

Article on HB 1013 in Miami Herald

Today's Miami Herald has an article, by Toluse Olorunnipa, about the ongoing battle over HB1013.  The Governor's office has received over 1,000 emails in recent days opposing the legislation. Opposition to the legislation outnumbers the supporters by a nearly 4-1 margin.  Per Governor Scott's deputy press secretary “The Governor is currently reviewing the bill and will make a decision in the allotted timeframe.”  The whole article is worth reading here.  As usual proponents of the legislation throw out the phrase "judicial activism" which completely ignores that the entire implied warranty was created by the judiciary to overcome another judicial doctrine, caveat emptor.  I have discussed the merits of the bill on numerous posts on the blog so I will not repeat them.  I know the Governor's office has been in touch with proponents and opponents of the bill to obtain information.  The best thing to do at this point is to continue contacting Governor Scott's...

Did You Include All Costs In Your Bid?

So it is time to sign your price proposal and get your bid in to a public agency. Have you considered all costs to perform the work, and those that are in addition to the cost of labor and materials? The public agency's terms and conditions should spell out all of the costs that are to be included in the price proposal. Such costs may go well beyond the cost of the work itself. For example, it may be that the cost of bonds, additional insurance coverage, permits and inspections are to be included in the cost of the work, and therefore the bid amount. It is also important to include all required elements as part of your pricing to make sure that your bid is responsive. Accordingly, it is imperative that bidders carefully consider all requirements that have a cost when estimating and calculating a bid. Generally, a public agency may...

HB 1013 (SB 1196) presented to Governor Scott

HB 1013, which eliminates common law implied warranties in common areas of all communities in the state, was sent Friday to Governor Rick Scott for his consideration. Governor Scott has until April 28, 2012 to act on the bill. He can sign the bill into law, veto it, or allow it to become law without his signature. This legislation leaves Florida home buyers with no protections for shared amenities and thereby shifts the burden for repairs to the homeowners and we urge Governor Scott to veto HB 1013. If you have not yet contacted Governor Scott, please do so and urge him to veto HB 1013. It is the only way to prevent this bill from becoming law.  You can e-mail Governor Scott at Rick.Scott@eog.myflorida.com and copy his Legislative Affairs Director, Jon Costello, at Jon.Costello@eog.myflorida.com. You can copy and paste the following suggested text in your message to the Governor: Please veto HB 1013, which eliminates common law...

Orlando Sentinel Editorial Opposes HB 1013

The Orlando Sentinel Editorial page of April 4, 2012, has come out in opposition to HB 1013, the anti-common law implied warranty legislation.  The editorial is reprinted in part below. To view the full editorial please follow the link.  Do not forget to contact the Governor's office to veto this legislation.  Editorial Below- When a leaking underground drainage system pitted roads and driveways and created sinkholes in lawns at aWinter Garden subdivision, homeowners sued the developer to cover the damage and repair costs. After conflicting rulings in lower courts, the case reached the Florida Supreme Court, which heard arguments on it in December. But before the justices had issued a ruling, the Florida Legislature stepped in like Judge Judy and moved to decide the case — and any future ones like it — in favor of the developer. Lawmakers often carp about being pre-empted or overruled by "activist judges." But in this case, lawmakers trumped the judges. Lobbied...

Ask the Governor to veto HB 1013(SB 1196)

The Governor's office has received numerous calls and emails in opposition to HB 1013, the anti-implied warranty legislation.  We are asking that you continue to urge Governor Scott to veto HB 1013.  It is the only way to prevent this bill from becoming law.  The bill has not yet been sent to the Governor for consideration, but we expect it to be sent very soon.  Therefore, please contact Governor Scott as soon as possible so that your voice can be heard. You can e-mail Governor Scott at Rick.Scott@eog.myflorida.com and copy his Legislative Affairs Director, Jon Costello, at Jon.Costello@eog.myflorida.com.  You can copy and paste the following suggested text in your message to the Governor:  Please veto HB 1013, which eliminates common law implied warranties in common areas of all communities in the state.  This legislation will result in greater costs for Florida’s homeowners, in the form of repairing shoddy construction, and ultimately lead to more foreclosures.  This...

Prominent Investor in P3 Projects Speaks About Florida’s Prospects

 

Jane Garvey, the North American Chair of Meridiam Infrastructure, knows a thing or two about public/private partnerships (“P3”). Meridiam is one of the country’s leaders in P3 projects, from compiling the P3 team and fertilizing it with ideas and experience to investing in the enterprise as a shareholder or lender. Jane is their top person in North America and shared her thoughts with me about Florida’s potential for P3 development. In this blog post and some that will follow, I will share her thoughts with you.

P3s are not ideal for every job. They’re more appropriate for large, complex, innovative projects not neatly fitting into traditional capital programs. The project must be critical to the public owner, as criticality will ensure the facility will be operated for the long-term, thus generating the necessary operational revenue to repay private investors and contractors for their risks. Criticality also ensures strong public sector buy-in, as lack of public commitment to the job may dilute the prospects of success. Historically, critical projects have included transportation as well as social infrastructure, such as schools, courthouses, and teaching hospitals.

 

The proposed P3 project must have a good revenue stream or it won’t attract investors or lenders. Stable revenue tied to the job, such as shares of federal funds, sales taxes or impact fees, will lure investors. Riskier prospects may deter investors. Without private funding, the P3 delivery method will fail, so it is important for funding to be attracted through assurances of stable revenue sources from which investors may earn an appropriate return on their investment.