DEFINING “ COMPLETION OF CONTRACT ” IN § 95.11 ( 3 )( c )
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On June 14 , 2017 , House Bill 377 was signed into law , amending section 95.11 ( 3 )( c ), Florida Statutes , to add a definition of “ completion of the contract .” Completion of the contract is one of five trigger events that commence the ten-year statute of repose for an action founded on the design , planning , or construction of an improvement to real property : ( i ) the date of possession by the owner ; ( ii ) the date of issuance of the certificate of occupancy ; ( iii ) the date of abandonment of construction , if not completed ; and ( iv ) the date of completion or termination of the contract between the engineer , architect , or licensed contractor and his or her employer , whichever date is latest .
The amendment ’ s focus on the “ completion of the contract ” trigger date stems from the Fifth District Court of Appeal ’ s decision in Cypress Fairway Condominium v . Bergeron Construction Co ., 164 So . 3d 706 ( Fla . 5th DCA 2015 ), where the determination of whether the plaintiff ’ s claims were timely filed turned on the “ date of completion of the contract .” The two dates in question in that case were exceptionally close : January 31 , 2001 ( the date the general contractor submitted its final application for payment to the
Completion of the contract means the later of the date of final performance ... or the date that final payment ... becomes due without regard to [ when ] final payment is made .
owner ) and February 2 , 2001 ( the day the owner paid the contractor ).
The plaintiff sued February 2 , 2011 — ten years to the day after the owner ’ s final payment to the contractor . The trial court dismissed the complaint as untimely under section 95.11 ( 3 )( c ). The Fifth DCA disagreed with the trial court ’ s reliance on the statute ’ s preamble , as opposed to its plain language , in finding that the contractor ’ s submission of the payment application commenced the repose period . Siding with plaintiff , the Fifth DCA held that the repose period commenced as of the date of the owner ’ s final payment . Specifically , “[ c ] ompletion of the contract means completion of performance by both sides of the contract , not merely performance by the contractor .” Id . at 708 . So the Fifth DCA reversed and remanded the trial court ’ s dismissal of the plaintiff ’ s suit .
In response to Cypress Fairway , 1 the Florida Legislature amended section 95.11 ( 3 )( c ), Florida Statutes , to ensure that the duration of a contractor ’ s liability will not be affected by the timing of a
customer ’ s payments under the construction contract : Completion of the contract means the later of the date of final performance of all the contracted services or the date that final payment for such services becomes due without regard to the date final payment is made . This amendment aims to address the decision in Cypress Fairway and attempts to avoid an open-ended window for the commencement of the repose period based on the completion of the contract . The amendment took effect on July 1 , 2017 .
Note : The author would like to thank Eman Lemu for her assistance in developing this article .
1
See Fla . S . Comm . on Judiciary , CS for SB 204 ( 2017 ) Staff Analysis ( March 15 , 2017 ); Fla . H . R . Comm . on Civ . Just . & Cl ., CS for HB 377 ( 2017 ) Staff Analysis ( March 16 , 2017 ).
Author : Michael G . Rothfeldt - Carlton Fields
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