Florida Court Of Appeal Applies Statute Of Repose To Construction Defect Claim

A recent Florida appellate decision determined that Florida’s statute of repose applicable to construction claims begins to run upon “completion of the contract” and that “completion of the contract” means when the final payment is made, not when the contractor completes its work.

At issue was the language of section 95.11(3)(c), Florida Statutes, which states: “In any event, the action [based upon construction defects] 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 or termination of the contract between the professional engineer, registered architect, or licensed contractor and his or her employer, whichever date is latest” (emphasis added).

The facts of the case created an issue whether the “completion” date occurred on January 31, 2001 (when the Final Application for Payment was made) or February 2, 2001 (when final payment was made).  The three-day separation was critical because the underlying lawsuit was filed on February 2, 2011.

The court of appeal concluded that the “completion of the contract” date occurred on February 2, 2001, when the final payment was made.  The court explained: “Completion of the contract means completion of performance by both sides of the contract, not merely performance by the contractor.  Had the legislature intended the statute to run from the time the contractor completed performance, it could have simply so stated.  It is not our function to alter plain and unambiguous language under the guise of interpreting a statute.”  Thus, “completion of the contract” means complete performance of the contract, not complete performance of the construction work by the contractor.

But what if the owner of the project intentionally delays final payment for several months or years?  Would the “completion of the contract” still be the date when final payment is made?  We will need to wait and see whether such a factual scenario presents itself to the trial courts of Florida.

Matthew J. Meyer is a Partner in our Florida office.