Recently, I read an informative article from another attorney addressing considerations of an owner when it receives a repair protocol in response to a Florida Statutes Chapter 558 notice of defect letter. This is a well-written article and raises two important issues applicable to construction defect disputes: 1) how is an owner supposed to respond to a repair protocol submitted by a contractor in accordance with Florida’s 558 notice of construction defects procedure and 2) irrespective of Florida’s 558 procedure, how is an owner supposed to treat a contractual notice to cure / notice of defect requirement that requires the owner to give the contractor a notice to cure a defect. This article raises such pertinent points that I wanted to address the issues and topics raised in this article.
558 Procedure–Owner’s Receipt of Contractor’s Repair Protocol
When a contractor submits a repair protocol to an owner in response to a notice of construction defects letter per Florida Statutes Chapter 558, the owner should seriously consider that protocol. The owner does this by discussing with counsel and any retained expert. The owner needs to know whether the protocol is a reasonable, cost-effective protocol to repair the asserted defects or, alternatively, whether the protocol is merely a band-aid approach and/or otherwise insufficiently addresses the claimed defects. Every scenario is different.
Oftentimes, I want my client’s expert (if I represent the owner) to analyze the protocol and opine as to the deficiencies in the repair protocol, as well as problems concerning the actual logistics of implementing the protocol. The objective would be that these opinions would come out down the road (say trial) when the contractor argues that the owner failed to mitigate damages by not promptly implementing the contractor’s repair protocol. Sometimes, I want a tolling agreement (an agreement to extend the statute of limitations where the other side agrees not to raise the statute of limitations as a defense) so that if the repairs do not work, the owner’s rights are not prejudiced and the owner can still pursue the defect claim.
As the article correctly pointed out, every scenario is fact-specific, however, in each scenario, the owner should consider the repairs being proposed by the contractor in response to a Florida Statutes Chapter 558 notice of construction defects letter.
Contractual Notice to Cure / Opportunity to Repair
The article further discussed the case of Underwater Engineering Services, Inc. v. Utility Board of the City of Key West, 194 So.3d 437 (Fla. 3d DCA 2016). Without getting into all of the technical facts, a public owner hired a contractor to perform certain structural repairs and, applicable here, the contract provided:
1.5 DEFECT ASSESSMENT
A. Replace the Work, or portions of the Work, not conforming to specified requirements.
B. If, at the request of the Contractor and in the opinion of the Engineer, it is not Practical to remove and replace the Work, the Engineer will direct one of the following remedies:
1. The defective Work may remain, but the Unit Price will be adjusted to a new price as agreed to by the Owner and Engineer.
2. The defective Work will be partially repaired to the instructions of the Engineer, and the Unit Price will be adjusted to a new price.
The public owner claimed that the contractor defectively constructed eight concrete collars. However, the public owner failed to give the contractor an opportunity to cure / replace the defectively constructed concrete collars. In other words, the contractor was never given an opportunity to actually cure or replace the asserted defect pursuant to the terms of the contract. As a consequence of the public owner violating this opportunity to cure requirement, the appellate court reversed an award of damages in favor of the public owner and remanded with directions to enter judgment in favor of the contractor as to the owner’s defect claim. Thus, by the public owner failing to give the contractor a contractual opportunity to cure–and unilaterally fixing the defects–the owner recovered nothing from the contractor due to the defective work.
Irrespective of the requirements of Florida Statutes Chapter 558, an owner should absolutely comply with a contractual notice to cure / repair requirement. Otherwise, the contractor has the argument that the owner’s failure to comply with this contractual requirement should preclude the owner from recovering any damages for fixing the defect.
Further, if an owner receives a repair protocol, whether in response to a contractual notice to cure requirement or Florida Statutes Chapter 558, the owner should consider the repair protocol and consult with counsel and any retained expert to analyze the reasonableness and logistics of the protocol.
Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.