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Articles Posted in Construction Litigation

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A recent ruling by Florida’s Third District Court of Appeal has clarified the question of whether a negligence claim against a design professional on a construction project is subject to the four-year or two-year statute of limitations set forth in Fla. Stat. §95.11. The Third DCA held that construction-related malpractice suits against design professionals are subject to the four-year rather than two-year statute of limitations.

In Am. Auto. Ins. v. FDH Infrastructure Servs., an engineering firm was sued after a construction accident claimed the lives of three workers during an installation on a nearly 1,000-foot tall telecommunications tower. The lower court granted summary judgment to the engineering firm, finding that the two-year statute of limitations for professional malpractice claims barred the lawsuit. In the ensuing appeal the plaintiff argued that the four-year statute of limitations for construction-related claims should apply instead of the two year, more general statute of limitations.

3dca-300x200Prior to this decision, which statute applies was a legal ambiguity which implicated two different statutes of limitations. One sets a period of two years for actions for professional malpractice, other than medical malpractice, and the other provides for four years for any action based on the design, planning, or construction of an improvement to real property. The uncertainty resulted in prior conflicting rulings applying each of the two- and four-year statutes.

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Florida’s ten-year deadline for lawsuits over hidden/latent construction defect claims, dubbed the “statute of repose,” has been in the spotlight recently, thanks to a controversial bill that was introduced in the state legislature. SB 736 would have reduced the deadline for certain claims to seven years, continuing a trend that began in 2006 when the repose period was lowered from fifteen years to ten.

A ruling by Florida’s Fifth District Court of Appeal focused on issues surrounding the determination of the trigger date for the start of the period of repose. The unanimous opinion reversed the lower court’s summary judgment in a case stemming from a construction defects lawsuit brought by the Spring Isle Community Association against Pulte Home Corporation.

Pulte, the developer of the 71 building, 390 townhome community in Spring Isle, Fla., was accused of construction defects related to the buildings’ exteriors and roofs. It filed a third-party complaint against several subcontractors, and the trial court found that the statute of repose barred its claims against one of the largest subcontractors on more than 80 percent of the townhomes.

Pulte appealed the trial court’s decision, and the association was substituted as the appellant.

5DCA-300x183In its appeal, the Spring Isle association argued that the repose period began when the master contract between Pulte and the subcontractor in question was completed, and also when all other townhome construction contracts were completed, which occurred less than ten years prior to the filing of Pulte’s third-party complaint.

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Stuart-Sobel-2021-2-200x300The Real Deal (www.therealdeal.com) chronicled the firm’s result in securing $6.4 million in damages from an affiliate of Codina Partners in a ruling that found the developer wrongfully terminated Grycon, the general contractor that built its 5350 Park condominium project in Downtown Doral.  Stuart Sobel, the lead counsel for the contractor, was quoted in the article, which is a follow-up to the real estate news website’s first report on the case from August 2020.  Today’s article reads:

. . . On Tuesday, following a non-jury trial, Miami-Dade Circuit Court Judge William Thomas ruled against 5350 Park LLC, the development entity managed by Codina Executive Chairman Armando Codina and the firm’s CEO Ana-Marie Codina Barlick. In 2020, Fort Lauderdale-based Grycon sued 5350 Park, alleging Codina Partners fired the general contractor without cause in order to avoid paying a final bill of $3.6 million. 5350 Park has a pending countersuit that was filed last year.

Coral Gables-based Codina will now have to pay nearly double what the developer allegedly owed, plus attorney fees and court costs, according to Thomas’ order. “The greater weight of the evidence establishes 5350’s termination of Grycon for cause was wrongful,” Thomas wrote.

RDeal“Judge Thomas ruled [Codina] didn’t have a right to terminate my client,” Grycon’s attorney Stuart Sobel said. “I don’t know what the real motivation is, but [Codina] has held off paying us a boatload of dough for almost three years now.”. . .

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A recent ruling by Florida’s Third District Court of Appeal reiterates that the terms of the warranty sued upon will ultimately dictate the forum for litigation of construction defects. For property owners considering suit, it is important to consider the implications of any forum selection clause prior to filing suit.

The appellate court’s opinion in West Bay Plaza Condominium Association v. Sika Corporation arose from the association’s appeal of the dismissal of its complaint based upon it being filed in the wrong court.

The dispute arose from work performed by a builder, construction manager and engineer for the association.  Sika, a supplier for the project, issued a five-year warranty to the association for sealant products used in the condominium’s parking garage. 3rd-dcapp-300x200The association sued Sika as well as the other parties involved in the project alleging breach of contract and negligence. It sued Sika for breach of warranty alleging that the sealants provided had allowed water to intrude into the garage.

Sika moved to dismiss, asserting that the warranty contained a forum selection clause requiring claims to be litigated in New Jersey. The association argued that it should not be required to litigate in New Jersey because it had never signed the warranty with Sika. However, the trial court dismissed the suit against Sika.

The appellate court affirmed.

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Stuart-Sobel-2021-2-200x300The firm’s lawsuit against Suffolk Construction on behalf of Suncor, a structural steel fabricator, involving the construction of the new Virgin Voyages cruise terminal at PortMiami completed last year was the subject of an article from April 6 by The Real Deal.  The breach of contract lawsuit filed in March in Miami-Dade Circuit Court alleges Suffolk withheld $2.6 million in payments, including for extra expenses accrued because the plans it provided were erroneous and incomplete.  The article reads:

. . . As the design-build contractor, Suffolk was responsible for the plans provided by the engineer. So, to the extent there were any errors or gaps, the accountability falls on Suffolk, said attorney Stuart Sobel, who represents Suncor.

RDeal“Suncor has done something like 100 jobs for Suffolk all over the country for 25 years. They had a great relationship with Suffolk until this job,” Sobel said. “And they are really at a wit’s end to explain why Suffolk has taken this position.”

Boston-based Suffolk declined comment.

Suffolk accused Suncor of delaying the job, but the steel contractor has proven that it did not, according to Sobel.

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Stuart-Sobel-2021-2-200x300When the editors and reporters at the Daily Business Review are seeking sage legal wisdom on major construction lawsuits involving high-profile projects for their readers, they turn to the firm’s Stuart Sobel for his input.  Stuart, who is board certified in construction law by The Florida Bar, was quoted extensively by the DBR on his insights and takeaways on a lawsuit involving the “Signature Bridge” currently under construction in downtown Miami.

The article from the Daily Business Review, South Florida’s exclusive business daily and official court newspaper, appeared in yesterday’s edition of the newspaper under the headline “In Miami Federal Lawsuit, Litigant Seeks $155 Million for ‘Signature’ Construction Gone Wrong.”  It focuses on a lawsuit in Miami federal court seeking the nine-figure damages due to the defendants’ alleged gross negligence in designing the new span that has been called Miami’s “Signature Bridge” (see renderings in video below).  The article reads:

. . . Stuart Sobel, a shareholder at Siegfried Rivera in Coral Gables, is not involved in the lawsuit that Alexandre Drummond, a partner at Seyfarth Shaw in Atlanta, filed on behalf of Archer Western LLC and De Moya Corp., identified in the complaint as CJV.  Sobel said it is suspect that one of the defendants, HDR Engineering Inc., would err so completely in its preliminary design documents, such as by failing to complete basic due diligence in not having wind tunnel testing done until after the project broke ground.

“You can do wind tunnel testing; you can do all sorts of testing, especially with the technologies that we now have,” Sobel said. “You can test the design 16 different ways from Sunday before you submit it. This is shocking to me if that’s true.” . . .

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A recent ruling by Florida’s Third District Court of Appeal over a dispute involving a new real estate development on a City of North Miami property has clarified a potentially confusing aspect of the lien law.

The ruling provides both the government landlords as well as their private-sector developer partners a new understanding of how Florida’s lien law will be applied if construction disputes arise and liens are filed.

The case involved a dispute at Biscayne Landing in North Miami. The City of North Miami leased the property in May 2012 to developer Oleta Partners LLC as a sub-landlord, and Oleta subsequently entered into a ground sublease with Warren Henry Automobiles for a new dealership on a portion of the property. 3dca-300x200Warren Henry later assigned the ground sublease to another company, which conveyed a leasehold interest in the property back to Warren Henry as a lower-tier sub-sub-tenant.

In 2017, the luxury automobile dealership retained general contractor James B. Pirtle Construction Co. to build its new store. A dispute arose and Pirtle recorded a construction lien against the tenant’s leasehold interest.

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Construction-Trial-Deskbook-Announcement-002-300x300Our firm is known around the country for our work in construction law-related matters. Recently, we were privileged to have been selected to have Jason Rodgers-da Cruz co-author one of the chapters for the American Bar Association’s newly released “Construction Trial Deskbook.”

The chapter, which is titled “Jury Instructions and Verdict Forms,” serves as a resource for construction attorneys preparing for trial. This trial practice handbook was written by construction lawyers who, collectively, have decades of trial experience. The book follows a trial sequence, with chapters on jury selection, opening statements, direct and cross-examination, handling experts and exhibits, jury instructions, and closing.

Our firm congratulates Jason Rodgers-da Cruz for his participation in developing such an essential chapter in a book that will play a vital role in assisting construction attorneys preparing to go to trial.  Click here for more information on the new book.

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It is essential for those in the construction industry, including contractors, subcontractors and suppliers, to learn about construction liens, which can be an additional layer of protection from non-payment. A construction lien provides unpaid project participants the ability to claim an interest in the property they have worked on. Once recorded, the lien remains on the title of the property until the lienholder gets paid for the work or services it provided, or the lien is otherwise released or discharged.

Though a helpful option in recovering unpaid amounts, the process of recording a construction lien is technical, and failing to follow specific requirements, some of which are outlined below, can result in a lien that is not perfected and subject to challenge. The following suggestions should be considered when filing a construction lien:

Serve a Notice to Owner

iStock_000011161523Medium-300x201Most claimants who do not have a direct contract with an owner need to serve a Notice to Owner as a first step in perfecting a claim of lien. Subcontractors, sub-subcontractors and material suppliers working on a construction project must serve a Notice to Owner pursuant to Section 713.06, Florida Statutes, within 45 days of first performing work or furnishing materials. Doing so preserves their right to record a claim of lien. Failure to properly complete this step can make a future claim of lien unenforceable.

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A 2019 Florida appellate court ruling in a case against a homebuilder alleging negligent construction of an attic ladder provided added clarity over what constitutes the construction of an improvement to real property under the state’s statute of repose law.

In James Harrell v. The Ryland Group, the First District Court of Appeal considered an appeal of a final summary judgment entered in favor of Ryland over the applicability of the 10-year statute of repose and whether the homebuilder failed to establish that the period of repose had run.

The case originally stemmed from injuries sustained by Harrell when the attic ladder he was climbing at his home collapsed. His lawsuit alleged that the homebuilder was negligent “by failing to ensure that the attic ladder was installed in a secure manner with the appropriate hardware” and “by failing to verify that the ladder was secure before selling the home.”

1dca-300x225The builder filed a motion to dismiss, arguing in part that the claim was barred by the 10-year statute of repose of section 95.11(3)(c), Florida Statutes. The trial court found that the statute is applicable because an attic ladder is an improvement to real property, but it denied the motion because it was not clear from the face of the complaint whether the suit was filed before the expiration of the 10-year period.

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