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Engaging in Contracting as a Business Organization

Section 489.105(13), Florida Statutes defines a “Business Organization” as “any partnership, corporation, business trust, joint venture, or other legal entity which engages or offers to engage in the business of contracting or acts as a contractor as defined in this section.” This definition is used in Section 489.119(2) of the Statute as follows: “If the applicant proposes to engage in contracting as a business organization, including any partnership, corporation, business trust, or other legal entity, or in any name other than the applicant’s legal name or a fictitious name where the applicant is doing business as a sole proprietorship, the applicant must apply for registration or certification as the qualifying agent of the business organization.” Effective October 1, 2009, the Department of Business and Professional Regulation eliminated the requirement for a separate business license for construction companies in Florida. However, contractors are still required to qualify construction businesses with their license and provide background...

What You Need to Know about Home Inspectors

The law now requires that Home Inspectors be licensed by the Department of Business and Professional Regulation (“DBPR”). Inspection services through a corporation or partnership is allowed provided that all personnel of the corporation or partnership who act on its behalf as Home Inspectors are licensed by the DBPR. Licensed home inspectors are treated by the DBPR similar to licensed contractors. Home Inspectors are now subject to disciplinary actions and must maintain a commercial general liability insurance policy in an amount of not less than $300,000.00.  Of note is the fact that the Home Inspectors law requires that after completion of a home inspection for compensation, the Home Inspector must provide a written report to the client. The report must indicate (1) the systems and components inspected that in his professional opinion are significantly deficient or are near the end of their useful life; (2) if not self-evident, the reason why the system or component...

Myths about Common Law Implied Warranties and the effect of the anti-Maronda Legislation

  On Tuesday I had the pleasure of being in Tallahassee and testifying at the House Civil Justice Subcommittee meeting against HB 1013 (the House equivalent of SB 1196). The Senate Judiciary Committee meeting scheduled for that afternoon was canceled and has been rolled over to next week.  Although my opinion on this legislation can be found here, here, here, here and here, I was interested in hearing the remarks of the Bill's sponsor and others in support of the bill.  After hearing those comments and having subsequent discussions with individuals supporting the bill it became clear to me that there existed several myths about common law implied warranties and the need for legislative action which needed to be addressed. Myth 1: The legislature must act immediately. This push by certain legislators to pass this bill by the end of this session ignores that the Supreme Court heard oral argument on the Lakeview case in the first week of December.  The issue...

SB 1196 (Anti-Maronda) heading to Senate Judiciary Committee

With the legislative session in full swing it appears that some legislators are pushing SB 1196 and its companion HB 1013, and are determined to wipe out common law implied warranties relating to residential construction. SB 1196 is sponsored by Senator Michael S. "Mike" Bennett (R), and HB 1013 is sponsored by Representative Frank Artiles(R). These bills are an overreaction to the recent opinion in Lakeview Reserve Homeowners v. Maronda Homes, Inc., 48 So. 3d 902 (Fla. 5th DCA 2010). As noted previously, and also here, here and here, these bills: -       -Would negatively impact homeowner associations, condominiums, co-ops, timeshares and mobile home parks as the term “home” is an all-encompassing term. -       -Ignores the fact that most new residential dwellings are built in planned communities -       -Expose homeowners to liability to repair defective construction and design for which they have no recourse -       -Homeowners who fail to pay their assessments for these repairs can have their homes foreclosed upon -       -Will result in...

SB 1196 amendment

As noted previously, SB 1196 (regarding common area common law implied warranties) was considered by the Community Affairs committee of the Florida Senate.  The committee passed the committee substitute bill which can be read here.  The next step will be consideration by the senate judiciary committee but that hearing has not yet been set.  The amendment to the bill does 2 primary things.  First, it removes the definition of habitability that was previously included. Given that the original definition limited habitability to situations where residents could not live free from structural defects likely to cause significant harm to the health and safety or persons, this merely removes a definition not found anywhere else in the law. Second, the amendment purports to not alter or limit causes of action which may exist in contract, tort or statute.  This is completely illusory. Most, if not all, purchase contracts disclaim any and all warranties and causes of action other than statutory ones which...

Learning From Others’ Lessons, That They Learned The Hard Way.

If an owner fails to promptly investigate symptoms of a construction defect, the owner not only runs the risk of a small problem becoming bigger and more expensive to fix, but also runs the risk of losing his or her right to hold the responsible entities accountable. Owners, like the Hochbergs, have lost claims by failing to promptly investigate defects and timely sue the responsbile entities. Others can learn from their experiences without suffering the consequences....

Common Law Implied Warranties and SB 1196

With the legislative session in full swing it appears that  SB 1196 and its companion HB 1013, are being pushed to wipe out common law implied warranties relating to residential construction.  These bills are reaction to the recent opinion in Lakeview Reserve Homeowners v. Maronda Homes, Inc., 48 So. 3d 902 (Fla. 5th DCA 2010). As noted previously, these bills: -        - would negatively impact homeowner associations, condominiums, co-ops, timeshares and mobile home parks as the term “home” is an all-encompassing term. -        - Ignores the fact that most new residential dwellings are built in planned communities -        -  Expose homeowners to liability to repair defective construction and design for which they have no recourse -       - Homeowners who fail to pay their assessments for these repairs can have their homes foreclosed upon -       - Will result in homeowners being stuck with shoddy construction with no remedy SB 1196 has been noticed for public hearing before the community affairs committee on Monday January 23, 2012, at 10am,...

What Developers and Contractors Need to Know About Destructive Testing

  Chapter 558 Fla. Stats. is Florida’s pre-suit notice and right to cure procedure, which applies before property owners may assert a claim against a developer, contractor, subcontractor or design professional for construction and design defects. It expressly provides for “destructive testing” of the defective areas of the property via written request and mutual agreement.  Destructive testing may be performed to refute the existence of defects. Examples of destructive testing may include such things as removing drywall, stucco, or other components to view the hidden conditions beneath it. At a minimum, a developer or contractor’s request for destructive testing should describe: (i) who is performing the testing, (ii) the anticipated testing methods and locations, (iii) the estimated anticipated damage and repairs to or restoration of the property resulting from the testing, (iv) the estimated amount of time necessary for the testing and to complete any repairs or restoration, and (v) who will bear...

ARE YOU AN ADDITIONAL INSURED – MAYBE OR MAYBE NOT?

Condominium associations, developers, and contractors will typically want to be named as an additional insured on casualty insurance policies of their respective contractors and subcontractors performing work on a construction project. One of the main advantages of being an additional insured is the existence of insurance to potentially cover certain casualty losses that may arise from the construction process. But, how does one truly know if they are an additional insured? Ideally, the insurance policy should have an endorsement that specifies who is an additional insured and that insured’s coverage. In this context, the policy should be examined to verify the nature and extent of coverage, including the policy period(s), any qualifications, limitations or other conditions that may affect an additional insured’s status and available coverage. At times, an additional insured will receive what is commonly referred to as an Acord Certificate of Insurance. This document generally summarizes a policyholder’s insurance coverage and...

Bid Protest Filing Deadlines Are Strict, Unless….

The general rule is that bid protests must be timely filed in order to be considered. Most government agencies in Florida have specific deadlines for which a bid protest must be filed. These deadlines are expressed in terms of days, or even hours, and may specify the exact method that the protest or notice of protest must be submitted to be considered timely filed. A Protest filed after the deadline is usually considered a waiver of the protestor’s rights.  There are, however, scenarios where a protest technically filed after the deadline may still be considered. This is exemplified in the recent case Pro Tech Monitoring, Inc. v. State Department of Corrections. There, a protesting bidder was supposed to hand-deliver its formal bid protest petition to the clerk by a certain date. The agency’s clerk, however, did not stamp the petition in until the next day, and the agency determined the protest was untimely. However, the protestor had tried...