New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract
is complete. They have created what can only be called a bright-line rule.
The contract between an Owner and a Contractor is complete upon payment to
the Contractor.
A bright line rule should work all the time and be equitable to both parties
if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the
record by a trial court." [A] bright-line rule [is] appealing in that it
establishes a rule that is easy to apply and relieves the trial court and
litigants of the burden of determining and guessing as to whether an
activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71
So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the
contract completion the Court add ambiguity to the mix. Further, this ruling
ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had
the Owner and/or the A/E accepted the buildings and were they being used and
occupied by the Owner? At the time of submitting the final pay application
did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act
whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made
on Friday. So, was the check written on Friday? Was it "deposited" or was it
"settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed"
on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction
contract is complete ("Completion of the contract means completion of
performance by both sides of the contract") then we need more direction than
"payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA
should have punted and said that the date of completion of the contract is
fact dependent.
-
The Fudge Factor - Owners now get to determine the contract
completion date (and this is just as unfair as allowing the GC to determine
it by sending the final pay app early). Would the Court have ruled
differently if the Owner took 90 days to pay? If they would have ruled
differently, then this is a bad bright-line rule.
-
Slow Pay Incentive - Any reason for an Owner to pay quickly given
this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the
end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required
by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point
(how many times does that happen?).
For the next six months both sides argue about something. (I had one where
it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and
they just drop the matter.
No written settlement, no promises, no extra performance by either side;
they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it
complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a
repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.com http://npw-law.com/
npw-logo-circle-orange-mediumConstructionLaw small logo
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From: clc-discussion-bounces@lists.flabarrpptl.org
[mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts,
Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet
final) that the statute of repose commenced to run when a construction
contract was completed rather than when construction was completed. The
parties argued over whether the statute of repose began to run from the date
the contractor made its final application for payment or whether the period
ran from the date the final payment was made. The Fifth DCA held that the
contract at issue was complete when the final payment was made and that the
statute began to run on that later date.
Carlton Fields Jorden Burt, P.A.
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.com | www.CFJBLaw.com http://www.cfjblaw.com/
bio http://www.cfjblaw.com/hroberts/ | vcard
http://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176
| LinkedIn
<http://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_pr
ofile>
Confidential: This e-mail contains a communication protected by the
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Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
CONFIDENTIALITY NOTICE: This e-mail transmission (and/or the attachments accompanying it) may contain confidential information belonging to the sender which is protected by the attorney-client privilege. The information is intended only for the use of the intended recipient. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Any unauthorized interception of this transmission is illegal. If you have received this transmission in error, please promptly notify the sender by reply e-mail, and then destroy all copies of the transmission.
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From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
So an owner can intentionally delay payment, or, where in good faith disputes final payment by litigation which it loses, and then is rewarded by getting the windfall of an extended SOL under the Statute of Repose?
Does not seem fair. Maybe we should be considering a legislative fix?
Regards,
Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman@wormanlaw.commailto:rworman@wormanlaw.com
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From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
CONFIDENTIALITY NOTICE: This e-mail transmission (and/or the attachments accompanying it) may contain confidential information belonging to the sender which is protected by the attorney-client privilege. The information is intended only for the use of the intended recipient. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Any unauthorized interception of this transmission is illegal. If you have received this transmission in error, please promptly notify the sender by reply e-mail, and then destroy all copies of the transmission.
IRS CIRCULAR 230 NOTICE: To ensure compliance with recently enacted U.S. Treasury Department regulations, we hereby advise you that, unless otherwise expressly stated, any and all tax advice contained in this communication has neither been written nor intended by the sender or this firm for the use of any taxpayer for the purpose of evading or avoiding tax penalties that may be imposed pursuant to U.S. law. Furthermore, unless otherwise expressly indicated, the use of any tax advice contained in this communication has neither been written nor intended by the sender or this firm for the purpose of promoting, marketing, or recommending a partnership or other entity, investment plan or arrangement to any taxpayer, and such taxpayer should seek advice on the taxpayer's particular circumstances from an independent tax advisor.
Replies Filtered: Any incoming reply to this e-mail communication or other e-mail communication to us will be electronically filtered for "spam" and/or "viruses." That filtering process may result in such reply or other e-mail communications to us being quarantined (i.e., potentially not received at our site at all) and/or delayed in reaching us. For that reason, we cannot guarantee that we will receive your reply or other e-mail communications to us and/or that we will receive the same in a timely manner. Accordingly, you should consider sending communications to us which are particularly important or time-sensitive by means other than e-mail.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
There is certainly a very plausible argument that "performance of the construction contract" is not completed until, at minimum, the one year warranty period has concluded. Now, if there are extended warranties, then that could push time of performance under the contract even further out. I think the statutory language triggering the start of the limitations/repose period is unnecessarily ambiguous and would personally like to see the language simplified to refer to an objective and easily verifiable date such as " the date of issuance of the Certificate of Occupancy or Temporary Certificate of Occupancy or, if a Certificate of Occupancy is not issued for the scope of work, the date of issuance of a Certificate of Completion or date of final inspection by the authority having jurisdiction".
Michael R. Gibbons (Biohttp://lowndes-law.com/our-people/michael-r-gibbons)
Shareholder
Lowndes, Drosdick, Doster, Kantor & Reed, P.A.
215 N. Eola Drive
Orlando, FL 32801
Phone: 407-418-6378
Fax: 407-843-4444
email: michael.gibbons@lowndes-law.commailto:michael.gibbons@lowndes-law.com
website: http://www.lowndes-law.comhttp://www.lowndes-law.com/
[cid:image001.jpg@01D08BE2.653B76D0]
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
CONFIDENTIALITY NOTICE: This e-mail transmission (and/or the attachments accompanying it) may contain confidential information belonging to the sender which is protected by the attorney-client privilege. The information is intended only for the use of the intended recipient. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Any unauthorized interception of this transmission is illegal. If you have received this transmission in error, please promptly notify the sender by reply e-mail, and then destroy all copies of the transmission.
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From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
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I understand, but would be opposed to opening up the SOR for this purpose.
Fred R. Dudley, Partner
Board Certified Construction Lawyer
Dudley, Sellers & Healy, P. L.
SunTrust Financial Center, Suite 301
3522 Thomasville Road
Tallahassee, Florida 32308
Cell: (850) 294-3471
Direct: (850)692-6368
dudley@mylicenselaw.com
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Worman
Sent: Monday, May 11, 2015 12:18 PM
To: Timothy R. Moorhead; Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
So an owner can intentionally delay payment, or, where in good faith disputes final payment by litigation which it loses, and then is rewarded by getting the windfall of an extended SOL under the Statute of Repose?
Does not seem fair. Maybe we should be considering a legislative fix?
Regards,
Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman@wormanlaw.commailto:rworman@wormanlaw.com
NOTICE:
THIS E-MAIL MESSAGE AND ANY ATTACHMENT TO THIS E-MAIL MESSAGE CONTAINS CONFIDENTIAL INFORMATION THAT MAY BE LEGALLY PRIVILEGED. IF YOU ARE NOT THE INTENDED RECIPIENT, YOU MUST NOT REVIEW, RETRANSMIT, CONVERT TO HARD COPY, COPY, USE OR DISSEMINATE THIS E-MAIL OR ANY ATTACHMENT TO IT. IF YOU HAVE RECEIVED THIS E-MAIL IN ERROR, PLEASE NOTIFY US IMMEDIATELY BY RETURN E-MAIL OR BY TELEPHONE AT 407-843-5353 AND DELETE THIS MESSAGE. PLEASE NOTE THAT IF THIS E-MAIL MESSAGE CONTAINS A FORWARDED MESSAGE OR IS A REPLY TO A PRIOR MESSAGE, SOME OR ALL OF THE CONTENTS OF THIS MESSAGE OR ANY ATTACHMENTS MAY NOT HAVE BEEN PRODUCED BY WORMAN & SHEFFLER, P.A.
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From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
CONFIDENTIALITY NOTICE: This e-mail transmission (and/or the attachments accompanying it) may contain confidential information belonging to the sender which is protected by the attorney-client privilege. The information is intended only for the use of the intended recipient. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Any unauthorized interception of this transmission is illegal. If you have received this transmission in error, please promptly notify the sender by reply e-mail, and then destroy all copies of the transmission.
IRS CIRCULAR 230 NOTICE: To ensure compliance with recently enacted U.S. Treasury Department regulations, we hereby advise you that, unless otherwise expressly stated, any and all tax advice contained in this communication has neither been written nor intended by the sender or this firm for the use of any taxpayer for the purpose of evading or avoiding tax penalties that may be imposed pursuant to U.S. law. Furthermore, unless otherwise expressly indicated, the use of any tax advice contained in this communication has neither been written nor intended by the sender or this firm for the purpose of promoting, marketing, or recommending a partnership or other entity, investment plan or arrangement to any taxpayer, and such taxpayer should seek advice on the taxpayer's particular circumstances from an independent tax advisor.
Replies Filtered: Any incoming reply to this e-mail communication or other e-mail communication to us will be electronically filtered for "spam" and/or "viruses." That filtering process may result in such reply or other e-mail communications to us being quarantined (i.e., potentially not received at our site at all) and/or delayed in reaching us. For that reason, we cannot guarantee that we will receive your reply or other e-mail communications to us and/or that we will receive the same in a timely manner. Accordingly, you should consider sending communications to us which are particularly important or time-sensitive by means other than e-mail.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
And perhaps a new practice point to consider:
In drafting settlement agreements where final payment was delayed for any reason, the parties should attempt to agree to and memorialize an agreed project completion date for the purposes of any future litigation related to latent defects. One less thing to litigate later on.
Robert E. Doan
County Attorney's Office
123 West Indiana Avenue, Ste. 301
DeLand, Florida 32720-4613
Telephone: (386) 736-5950
Fax: (386) 736-5990
Email: rdoan@volusia.org
Fred Dudley dudley@mylicenselaw.com 5/11/2015 12:55 PM >>>
I understand, but would be opposed to opening up the SOR for this purpose.
Fred R. Dudley, Partner
Board Certified Construction Lawyer
Dudley, Sellers & Healy, P. L.
SunTrust Financial Center, Suite 301
3522 Thomasville Road
Tallahassee, Florida 32308
Cell: (850) 294-3471
Direct: (850)692-6368
dudley@mylicenselaw.com
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Worman
Sent: Monday, May 11, 2015 12:18 PM
To: Timothy R. Moorhead; Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
So an owner can intentionally delay payment, or, where in good faith disputes final payment by litigation which it loses, and then is rewarded by getting the windfall of an extended SOL under the Statute of Repose?
Does not seem fair. Maybe we should be considering a legislative fix?
Regards,
Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman@wormanlaw.commailto:rworman@wormanlaw.com
NOTICE:
THIS E-MAIL MESSAGE AND ANY ATTACHMENT TO THIS E-MAIL MESSAGE CONTAINS CONFIDENTIAL INFORMATION THAT MAY BE LEGALLY PRIVILEGED. IF YOU ARE NOT THE INTENDED RECIPIENT, YOU MUST NOT REVIEW, RETRANSMIT, CONVERT TO HARD COPY, COPY, USE OR DISSEMINATE THIS E-MAIL OR ANY ATTACHMENT TO IT. IF YOU HAVE RECEIVED THIS E-MAIL IN ERROR, PLEASE NOTIFY US IMMEDIATELY BY RETURN E-MAIL OR BY TELEPHONE AT 407-843-5353 AND DELETE THIS MESSAGE. PLEASE NOTE THAT IF THIS E-MAIL MESSAGE CONTAINS A FORWARDED MESSAGE OR IS A REPLY TO A PRIOR MESSAGE, SOME OR ALL OF THE CONTENTS OF THIS MESSAGE OR ANY ATTACHMENTS MAY NOT HAVE BEEN PRODUCED BY WORMAN & SHEFFLER, P.A.
TAX ADVICE DISCLOSURE: TO ENSURE COMPLIANCE WITH REQUIREMENTS IMPOSED BY THE IRS UNDER CIRCULAR 230, WE INFORM YOU THAT ANY U.S. FEDERAL TAX ADVICE CONTAINED IN THIS COMMUNICATION (INCLUDING ANY ATTACHMENTS), UNLESS OTHERWISE SPECIFICALLY STATED, WAS NOT INTENDED TO BE USED, AND CANNOT BE USED, FOR THE PURPOSES OF (1) AVOIDING PENALTIES UNDER THE INTERNAL REVENUE CODE OR (2) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.
PLEASE BE ADVISED THIS LAW FIRM MAY BE ACTING AS A DEBT COLLECTOR AND IS ATTEMPTING TO COLLECT A DEBT. ANY INFORMATION PROVIDED WILL BE USED FOR THAT PURPOSE.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
CONFIDENTIALITY NOTICE: This e-mail transmission (and/or the attachments accompanying it) may contain confidential information belonging to the sender which is protected by the attorney-client privilege. The information is intended only for the use of the intended recipient. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Any unauthorized interception of this transmission is illegal. If you have received this transmission in error, please promptly notify the sender by reply e-mail, and then destroy all copies of the transmission.
IRS CIRCULAR 230 NOTICE: To ensure compliance with recently enacted U.S. Treasury Department regulations, we hereby advise you that, unless otherwise expressly stated, any and all tax advice contained in this communication has neither been written nor intended by the sender or this firm for the use of any taxpayer for the purpose of evading or avoiding tax penalties that may be imposed pursuant to U.S. law. Furthermore, unless otherwise expressly indicated, the use of any tax advice contained in this communication has neither been written nor intended by the sender or this firm for the purpose of promoting, marketing, or recommending a partnership or other entity, investment plan or arrangement to any taxpayer, and such taxpayer should seek advice on the taxpayer's particular circumstances from an independent tax advisor.
Replies Filtered: Any incoming reply to this e-mail communication or other e-mail communication to us will be electronically filtered for "spam" and/or "viruses." That filtering process may result in such reply or other e-mail communications to us being quarantined (i.e., potentially not received at our site at all) and/or delayed in reaching us. For that reason, we cannot guarantee that we will receive your reply or other e-mail communications to us and/or that we will receive the same in a timely manner. Accordingly, you should consider sending communications to us which are particularly important or time-sensitive by means other than e-mail.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
Please remember that the SOR is simply and "outside" date by which, for latent construction defects, the 4-year statute of limitation is deemed to have started to run when the owner knew or should have known about the defect. So, delayed payment should not have a much impact; it there is litigation, owner will have certainly called in an engineer to determine any latent defects, and the 4-year SOL starts to run at that time.
Fred R. Dudley, Partner
Board Certified Construction Lawyer
Dudley, Sellers & Healy, P. L.
SunTrust Financial Center, Suite 301
3522 Thomasville Road
Tallahassee, Florida 32308
Cell: (850) 294-3471
Direct: (850)692-6368
dudley@mylicenselaw.com
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:59 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
Agreed, if you represent the contractor, but even then I'm not sure you can override the statutory triggers as interpreted by the court decisions.
Sent from my Verizon Wireless 4G LTE smartphone
-------- Original message --------
From: Robert Doan rdoan@volusia.org
Date: 05/11/2015 1:48 PM (GMT-05:00)
To: clc-discussion@lists.flabarrpptl.org
Subject: [SPAM] Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
And perhaps a new practice point to consider:
In drafting settlement agreements where final payment was delayed for any reason, the parties should attempt to agree to and memorialize an agreed project completion date for the purposes of any future litigation related to latent defects. One less thing to litigate later on.
Robert E. Doan
County Attorney's Office
123 West Indiana Avenue, Ste. 301
DeLand, Florida 32720-4613
Telephone: (386) 736-5950
Fax: (386) 736-5990
Email: rdoan@volusia.org
Fred Dudley dudley@mylicenselaw.com 5/11/2015 12:55 PM >>>
I understand, but would be opposed to opening up the SOR for this purpose.
Fred R. Dudley, Partner
Board Certified Construction Lawyer
Dudley, Sellers & Healy, P. L.
SunTrust Financial Center, Suite 301
3522 Thomasville Road
Tallahassee, Florida 32308
Cell: (850) 294-3471
Direct: (850)692-6368
dudley@mylicenselaw.com
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Worman
Sent: Monday, May 11, 2015 12:18 PM
To: Timothy R. Moorhead; Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
So an owner can intentionally delay payment, or, where in good faith disputes final payment by litigation which it loses, and then is rewarded by getting the windfall of an extended SOL under the Statute of Repose?
Does not seem fair. Maybe we should be considering a legislative fix?
Regards,
Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman@wormanlaw.commailto:rworman@wormanlaw.com
NOTICE:
THIS E-MAIL MESSAGE AND ANY ATTACHMENT TO THIS E-MAIL MESSAGE CONTAINS CONFIDENTIAL INFORMATION THAT MAY BE LEGALLY PRIVILEGED. IF YOU ARE NOT THE INTENDED RECIPIENT, YOU MUST NOT REVIEW, RETRANSMIT, CONVERT TO HARD COPY, COPY, USE OR DISSEMINATE THIS E-MAIL OR ANY ATTACHMENT TO IT. IF YOU HAVE RECEIVED THIS E-MAIL IN ERROR, PLEASE NOTIFY US IMMEDIATELY BY RETURN E-MAIL OR BY TELEPHONE AT 407-843-5353 AND DELETE THIS MESSAGE. PLEASE NOTE THAT IF THIS E-MAIL MESSAGE CONTAINS A FORWARDED MESSAGE OR IS A REPLY TO A PRIOR MESSAGE, SOME OR ALL OF THE CONTENTS OF THIS MESSAGE OR ANY ATTACHMENTS MAY NOT HAVE BEEN PRODUCED BY WORMAN & SHEFFLER, P.A.
TAX ADVICE DISCLOSURE: TO ENSURE COMPLIANCE WITH REQUIREMENTS IMPOSED BY THE IRS UNDER CIRCULAR 230, WE INFORM YOU THAT ANY U.S. FEDERAL TAX ADVICE CONTAINED IN THIS COMMUNICATION (INCLUDING ANY ATTACHMENTS), UNLESS OTHERWISE SPECIFICALLY STATED, WAS NOT INTENDED TO BE USED, AND CANNOT BE USED, FOR THE PURPOSES OF (1) AVOIDING PENALTIES UNDER THE INTERNAL REVENUE CODE OR (2) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.
PLEASE BE ADVISED THIS LAW FIRM MAY BE ACTING AS A DEBT COLLECTOR AND IS ATTEMPTING TO COLLECT A DEBT. ANY INFORMATION PROVIDED WILL BE USED FOR THAT PURPOSE.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
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From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law
Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
CLC-Discussion mailing list
CLC-Discussion@lists.flabarrpptl.org
http://mailman.fsr.com/mailman/listinfo/clc-discussion
Might not such a provision be void under Fla. Stat. §95.03http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0000-0099/0095/Sections/0095.03.html?
Bryan L. Capps, Esq.
Board Certified in Construction Law by the Florida Bar
Moye, O'Brien, Pickert & Dillon, LLP
800 S. Orlando Ave.
Maitland, FL 32751
Ph: (407) 622-5250
Cell: (407) 808-0098
bcapps@moopd.commailto:bcapps@moopd.com
www.moopd.comhttp://www.moopd.com
-----Original Message-----
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Doan
Sent: Monday, May 11, 2015 1:37 PM
To: clc-discussion@lists.flabarrpptl.org
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
And perhaps a new practice point to consider:
In drafting settlement agreements where final payment was delayed for any reason, the parties should attempt to agree to and memorialize an agreed project completion date for the purposes of any future litigation related to latent defects. One less thing to litigate later on.
Robert E. Doan
County Attorney's Office
123 West Indiana Avenue, Ste. 301
DeLand, Florida 32720-4613
Telephone: (386) 736-5950
Fax: (386) 736-5990
Fred Dudley <dudley@mylicenselaw.commailto:dudley@mylicenselaw.com> 5/11/2015 12:55 PM >>>
I understand, but would be opposed to opening up the SOR for this purpose.
Fred R. Dudley, Partner
Board Certified Construction Lawyer
Dudley, Sellers & Healy, P. L.
SunTrust Financial Center, Suite 301
3522 Thomasville Road
Tallahassee, Florida 32308
Cell: (850) 294-3471
Direct: (850)692-6368
dudley@mylicenselaw.commailto:dudley@mylicenselaw.com
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Worman
Sent: Monday, May 11, 2015 12:18 PM
To: Timothy R. Moorhead; Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
So an owner can intentionally delay payment, or, where in good faith disputes final payment by litigation which it loses, and then is rewarded by getting the windfall of an extended SOL under the Statute of Repose?
Does not seem fair. Maybe we should be considering a legislative fix?
Regards,
Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman@wormanlaw.com<mailto:rworman@wormanlaw.commailto:rworman@wormanlaw.com%3cmailto:rworman@wormanlaw.com>
NOTICE:
THIS E-MAIL MESSAGE AND ANY ATTACHMENT TO THIS E-MAIL MESSAGE CONTAINS CONFIDENTIAL INFORMATION THAT MAY BE LEGALLY PRIVILEGED. IF YOU ARE NOT THE INTENDED RECIPIENT, YOU MUST NOT REVIEW, RETRANSMIT, CONVERT TO HARD COPY, COPY, USE OR DISSEMINATE THIS E-MAIL OR ANY ATTACHMENT TO IT. IF YOU HAVE RECEIVED THIS E-MAIL IN ERROR, PLEASE NOTIFY US IMMEDIATELY BY RETURN E-MAIL OR BY TELEPHONE AT 407-843-5353 AND DELETE THIS MESSAGE. PLEASE NOTE THAT IF THIS E-MAIL MESSAGE CONTAINS A FORWARDED MESSAGE OR IS A REPLY TO A PRIOR MESSAGE, SOME OR ALL OF THE CONTENTS OF THIS MESSAGE OR ANY ATTACHMENTS MAY NOT HAVE BEEN PRODUCED BY WORMAN & SHEFFLER, P.A.
TAX ADVICE DISCLOSURE: TO ENSURE COMPLIANCE WITH REQUIREMENTS IMPOSED BY THE IRS UNDER CIRCULAR 230, WE INFORM YOU THAT ANY U.S. FEDERAL TAX ADVICE CONTAINED IN THIS COMMUNICATION (INCLUDING ANY ATTACHMENTS), UNLESS OTHERWISE SPECIFICALLY STATED, WAS NOT INTENDED TO BE USED, AND CANNOT BE USED, FOR THE PURPOSES OF (1) AVOIDING PENALTIES UNDER THE INTERNAL REVENUE CODE OR (2) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.
PLEASE BE ADVISED THIS LAW FIRM MAY BE ACTING AS A DEBT COLLECTOR AND IS ATTEMPTING TO COLLECT A DEBT. ANY INFORMATION PROVIDED WILL BE USED FOR THAT PURPOSE.
From: clc-discussion-bounces@lists.flabarrpptl.org<mailto:clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org%3cmailto:clc-discussion-bounces@lists.flabarrpptl.org> [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.com<mailto:tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com%3cmailto:tmoorhead@wfmblaw.com>
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From: clc-discussion-bounces@lists.flabarrpptl.org<mailto:clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org%3cmailto:clc-discussion-bounces@lists.flabarrpptl.org> [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.com<http://npw-law.com/http://npw-law.com%3chttp:/npw-law.com/>
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.org<mailto:clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org%3cmailto:clc-discussion-bounces@lists.flabarrpptl.org> [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.org<mailto:clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org%3cmailto:clc-discussion@lists.flabarrpptl.org>)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.com<mailto:HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com%3cmailto:HRoberts@cfjblaw.com> | www.CFJBLaw.com<http://www.cfjblaw.com/http://www.CFJBLaw.com%3chttp:/www.cfjblaw.com/>
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
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Would "agreeing" to a "project completion date" run afoul of 95.03? --
95.03 Contracts shortening time.—Any provision in a contract fixing the period of time within which an action arising out of the contract may be begun at a time less than that provided by the applicable statute of limitations is void.
History.—ss. 1, 2, ch. 6465, 1913; RGS 2931; CGL 4651; s. 2, ch. 74-382.
Or would it not do so because the statute only refers to a "statute of limitation" and not statutes of repose?
I don't know the answer, but it's something to think about...
Bruce D. Partington
Clark Partington
bpartington@cphlaw.com
Direct: 850-432-1399
Fax: 850-432-7340
*Board Certified in Construction Law
-----Original Message-----
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Doan
Sent: Monday, May 11, 2015 12:37 PM
To: clc-discussion@lists.flabarrpptl.org
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
And perhaps a new practice point to consider:
In drafting settlement agreements where final payment was delayed for any reason, the parties should attempt to agree to and memorialize an agreed project completion date for the purposes of any future litigation related to latent defects. One less thing to litigate later on.
Robert E. Doan
County Attorney's Office
123 West Indiana Avenue, Ste. 301
DeLand, Florida 32720-4613
Telephone: (386) 736-5950
Fax: (386) 736-5990
Email: rdoan@volusia.org
Fred Dudley dudley@mylicenselaw.com 5/11/2015 12:55 PM >>>
I understand, but would be opposed to opening up the SOR for this purpose.
Fred R. Dudley, Partner
Board Certified Construction Lawyer
Dudley, Sellers & Healy, P. L.
SunTrust Financial Center, Suite 301
3522 Thomasville Road
Tallahassee, Florida 32308
Cell: (850) 294-3471
Direct: (850)692-6368
dudley@mylicenselaw.com
From: clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Robert Worman
Sent: Monday, May 11, 2015 12:18 PM
To: Timothy R. Moorhead; Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
So an owner can intentionally delay payment, or, where in good faith disputes final payment by litigation which it loses, and then is rewarded by getting the windfall of an extended SOL under the Statute of Repose?
Does not seem fair. Maybe we should be considering a legislative fix?
Regards,
Robert B. Worman
Worman & Sheffler, P.A.
2707 West Fairbanks Avenue
Suite 200
Winter Park, FL 32789
407 843-5353
rworman@wormanlaw.commailto:rworman@wormanlaw.com
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From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Timothy R. Moorhead
Sent: Monday, May 11, 2015 11:30 AM
To: Jeff Price; 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: Re: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Peers:
Frankly, I think the 5th got it right. I would be cautious that the question put to the Court was very finite and avoid the urge to over apply the ruling. The question was, when is a contract complete for the purposes of the Statute of Repose? The simple answer, in my simple mind at least, is when all performance due thereunder, including payment has occurred. Here, payment was due after performance and is a clear indication of the Owner's agreement that performance by the Contractor was complete.
The legislature should have said "construction" if that is what they meant. They said "contract." We have to assume that they knew and appreciated the difference.
Timothy R. Moorhead, Esq.
[cid:image001.jpg@01CF533E.817267B0]
Wright, Fulford, Moorhead & Brown, P.A.
505 Maitland Avenue
Suite 1000
Altamonte Springs, FL 32701
(407) 425-0234
(407) 425-0260 (fax)
Board Certified in Construction Law
tmoorhead@wfmblaw.commailto:tmoorhead@wfmblaw.com
www.wfmblaw.comhttp://www.wfmblaw.com
CONFIDENTIALITY NOTICE: This e-mail transmission (and/or the attachments accompanying it) may contain confidential information belonging to the sender which is protected by the attorney-client privilege. The information is intended only for the use of the intended recipient. If you are not the intended recipient, you are hereby notified that any disclosure, copying, distribution or the taking of any action in reliance on the contents of this information is strictly prohibited. Any unauthorized interception of this transmission is illegal. If you have received this transmission in error, please promptly notify the sender by reply e-mail, and then destroy all copies of the transmission.
IRS CIRCULAR 230 NOTICE: To ensure compliance with recently enacted U.S. Treasury Department regulations, we hereby advise you that, unless otherwise expressly stated, any and all tax advice contained in this communication has neither been written nor intended by the sender or this firm for the use of any taxpayer for the purpose of evading or avoiding tax penalties that may be imposed pursuant to U.S. law. Furthermore, unless otherwise expressly indicated, the use of any tax advice contained in this communication has neither been written nor intended by the sender or this firm for the purpose of promoting, marketing, or recommending a partnership or other entity, investment plan or arrangement to any taxpayer, and such taxpayer should seek advice on the taxpayer's particular circumstances from an independent tax advisor.
Replies Filtered: Any incoming reply to this e-mail communication or other e-mail communication to us will be electronically filtered for "spam" and/or "viruses." That filtering process may result in such reply or other e-mail communications to us being quarantined (i.e., potentially not received at our site at all) and/or delayed in reaching us. For that reason, we cannot guarantee that we will receive your reply or other e-mail communications to us and/or that we will receive the same in a timely manner. Accordingly, you should consider sending communications to us which are particularly important or time-sensitive by means other than e-mail.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Jeff Price
Sent: Monday, May 11, 2015 10:43 AM
To: 'Roberts, Hardy L.'; 'CLC Discussion'
Subject: [CLC-Discussion] New Statute of Repose Decision in 5th DCA
Cypress v. Bergeron, 5D13-4102 (May 8, 2015).
The 5th DCA has created an unnecessary rule for when a construction contract is complete. They have created what can only be called a bright-line rule. The contract between an Owner and a Contractor is complete upon payment to the Contractor.
A bright line rule should work all the time and be equitable to both parties if, as the court said, the statute language is unambiguous.
"[A] bright-line test will ordinarily require only a cursory review of the record by a trial court." [A] bright-line rule [is] appealing in that it establishes a rule that is easy to apply and relieves the trial court and litigants of the burden of determining and guessing as to whether an activity is merely passive or active." Chemrock Corp. v. Tampa Elec. Co., 71 So. 3d 786, 791-92 (Fla. 2011).
By holding that the date of final payment to the contractor signifies the contract completion the Court add ambiguity to the mix. Further, this ruling ignores three things in my mind:
-
Reality - the facts on the ground. For example: In this case, had the Owner and/or the A/E accepted the buildings and were they being used and occupied by the Owner? At the time of submitting the final pay application did anyone disagree that the work was done?
a. Was the 3 day lag for payment simply a "passive" ministerial act whose timing was dependent upon the postal service?
b. The pay app was delivered on Wednesday and "final payment" was made on Friday. So, was the check written on Friday? Was it "deposited" or was it "settled" on Friday at the bank? Was it "mailed" on Friday? Was it "signed" on Friday? Or was it handed to the contractor on Friday?
If the Court is creating a bright-line rule about when a construction contract is complete ("Completion of the contract means completion of performance by both sides of the contract") then we need more direction than "payment was made."
The thing is, the trial court can hold an evidentiary hearing. The DCA should have punted and said that the date of completion of the contract is fact dependent.
-
The Fudge Factor - Owners now get to determine the contract completion date (and this is just as unfair as allowing the GC to determine it by sending the final pay app early). Would the Court have ruled differently if the Owner took 90 days to pay? If they would have ruled differently, then this is a bad bright-line rule. -
Slow Pay Incentive - Any reason for an Owner to pay quickly given this ruling? Will this ruling delay final payments in some regards?
Does the Court's ruling work if, say, the Owner and GC are at odds at the end of the contract?
Let's try an everyday construction law example:
GC says they are done and sends final pay app and everything else required by statute and the contract.
Owner says GC is not done and withholds payment claiming some sticking point (how many times does that happen?).
For the next six months both sides argue about something. (I had one where it was door numbers in the wrong typeface).
After six months they all realize the lawyers are costing too much money and they just drop the matter.
No written settlement, no promises, no extra performance by either side; they just decide to stop fighting.
The Owner sends the final payment. Is the contract complete now? Or was it complete six months earlier?
Does the 5th DCA's bright-line rule accomplish justice if, later on in a repose fight, the Owner gets to claim an extra 6 months?
Jeffrey L. Price, Esq.
Florida Bar Board Certified - Construction Law Florida Civil-law Notary
Niesen|Price|Worthy|Campo, PA
5216 SW 91st Drive Gainesville, FL 32608
Ph (352) 373-9031 Fax (352) 373-9099
http://npw-law.comhttp://npw-law.com/
[npw-logo-circle-orange-medium][ConstructionLaw small logo] [http://www.boyd-jenerette.com/blog/wp-content/uploads/2012/05/nacln12.gif] This communication is intended for the sole use of the individual or entity to which it is addressed and may contain information that is privileged, confidential and exempt from disclosure under applicable law. If the reader of this communication is not the intended recipient, employee or agent responsible for delivering the message to the intended recipient, you are hereby notified that any review, dissemination, distribution or copying of this communication is strictly prohibited. If you have received this communication in error, please immediately notify me by telephone, delete this communication, and destroy any copies of it. Thank you.
From: clc-discussion-bounces@lists.flabarrpptl.orgmailto:clc-discussion-bounces@lists.flabarrpptl.org [mailto:clc-discussion-bounces@lists.flabarrpptl.org] On Behalf Of Roberts, Hardy L.
Sent: Friday, May 08, 2015 2:14 PM
To: CLC Discussion (clc-discussion@lists.flabarrpptl.orgmailto:clc-discussion@lists.flabarrpptl.org)
Subject: [CLC-Discussion] CLC -- New Statute of Repose Decision
The Fifth District held today (in the attached opinion that is not yet final) that the statute of repose commenced to run when a construction contract was completed rather than when construction was completed. The parties argued over whether the statute of repose began to run from the date the contractor made its final application for payment or whether the period ran from the date the final payment was made. The Fifth DCA held that the contract at issue was complete when the final payment was made and that the statute began to run on that later date.
[Carlton Fields Jorden Burt, P.A.]
Hardy L. Roberts
Attorney at Law
Board Certified in Construction Law by the Florida Bar
4221 W. Boy Scout Blvd., Ste. 1000
Tampa, Florida 33607-5780
Direct: 813.229.4105 | Fax: 813.229.4133
HRoberts@cfjblaw.commailto:HRoberts@cfjblaw.com | www.CFJBLaw.comhttp://www.cfjblaw.com/
biohttp://www.cfjblaw.com/hroberts/ | vcardhttp://www.cfjblaw.com/FCWSite/Features/_Attorneys/vCard.aspx?attorney=176 | LinkedInhttp://www.linkedin.com/profile/view?id=249761797&trk=nav_responsive_tab_profile
Confidential: This e-mail contains a communication protected by the attorney-client privilege or constitutes work product. If you do not expect such a communication please delete this message without reading it or any attachment and then notify the sender of this inadvertent delivery.
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