Florida Construction Law

Final Order Declaratory Statement was issued in DS 2010-055, filed on September 22, 2010 , In Re: Malcolm Drilling Company, Inc ., holding that a subcontractor who was not required to have a Division II license for foundation boring and soil stabilization on the Miami Access Tunnel, did not need a Division I license pursuant to s. 489.113(2) where all work was to be performed under the supervision of a licensed Division I contractor. For full text of the Petition for this Declaratory Statement see Vol. 36, No. 30, of the July 30, 2010 Florida Administrative Weekly. Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasmussen.com/

On April 1, 2011, I will be presenting a 1.5 hour seminar on construction lien law for the Florida Refrigeration & Air Conditioning Contractors Association (FRACCA).  The seminar is part of the 2011 Education Conference held at the Rosen Centre in Orlando, Florida. Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

Blanco v. Department of Business and Professional Regulation (Council of Community Association Managers) , Case No 10-2905 RX (a rule challenge): Final Order of August 23, 2010, declares invalid Rule 61E14-2.001(5), regarding “Control of Others,” for lack of specific statutory rulemaking authority, in an administrative action against an employer for violations committed by employees. In addition, pursuant to s. 120.595(3), the ALJ found that the licensee would be entitled to an award of reasonable attorney’s fees, pending a hearing to determine if the agency “demonstrates that its actions were substantially justified or special circumstances exist which would make the award unjust,” as provided in that statute. While there do not appear to be any similar “control by others” rules governing licensees of the various construction regulatory boards, this case may be the basis for a new defense in administrative disciplinary actions against a construction licensee for violations committed

AmeriLoss Public Adjusting Corp. , Florida Third District Court of Appeal (October 6, 2010), Case No. 3D09-363: Dismissed a challenge to an administrative Declaratory Statement issued by the Department of Financial Services to Clyde Lightbourn regarding his contractual obligation to pay an adjusting fee for property damages caused by Hurricane Katrina, because the appellant was not a party to the administrative proceedings. While it appears that the propriety of issuing a Declaratory Statement for past conduct was not been raised, this case highlights the importance of timely intervening in such administrative hearings (and to reviewing the required publication of notice of such proceedings in the Florida Administrative Weekly ). Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasmussen.com

In Pohlman v. Aqua Condominium Developers , 44 So.3d 645 (Fla. 1st DCA 2010) which followed Aikin v. WCI Communities , 26 So. 3d 691 (Fla. 2d DCA 2010), but conflicted with Plaza Court v. Baker-Chaput , 17 So. 3d 720 (Fla. 5th DCA 2009), the Court affirmed the dismissal of the contract purchasers’ action seeking rescission based on the developer’s failure to comply with the ILSA exemption regarding the seller’s obligation to complete construction within 2 years where such obligation is excused under applicable Florida contract law.  A contract provisions allowing for additional time in the event of construction delays did not make the obligation to complete construction in two years illusory. Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasmussen.com

Whitehead v. Tyndall Federal Credit Union , Florida First District Court of Appeal (September 16, 2010), Case No. 1D09-5221: Original contractor who had been terminated by homeowners prior to completion of construction sued lender for disbursing remaining loan proceeds to replacement contractor based on failure to give notice pursuant t o section 713.3471(2)(a), F. S. Trial court agreed, but was reversed, with one dissenting vote, and lender was held liable to original contractor for balance of loan proceeds disbursed to replacement contractor. Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasmussen.com

DBPR/CILB v. Millman , Case No 10-2463: Recommended order of August 27, 2010, recommends that the CILB impose only a $500 fine for non-payment of a judgment against a Division I contractor in favor of a supplier, and rejects a proposed “restitution” for lack of statutory authority, except as to a “consumer." Trenton H. Cotney Florida Bar Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S. Ashley Dr., Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasmussen.com/  

Florida Hurricane Protection and Awning v. Patina , 35 Fla. L. Weekly D2024a (September 8, 2010). The “mutuality” of attorney fees pursuant to section 57.105(7) was used by the trial court to award fees to the homeowner where the contract provided: “Purchaser is responsible for all costs of collection including Attorney’s fees. And 1.5 % of contract amount.” The original contractor did not complete the performance, so the homeowner brought an action for breach of contract for the cost to complete, some consequential damages for subsequent hurricane damages as well as attorney’s fees based on section reciprocity provision of the statute. The appellate court reversed and remanded the case to vacate the attorney’s fees judgment since there was no action by the contractor to collect the contract balance. Trenton H. Cotney Florida Bar Board Certified in Construction Law Glenn Rasmussen Fogarty & Hooker, P.A. 100 S Ashley Dr, Suite 1300 Tampa, FL 33602 (813) 229-3333 http://www.glennrasm

14th & Heinberg v. Terhaar and Cronley , 35 Fla. L. Weekly D2001b (September 7, 2010): Tenant’s contractor, while prohibited from obtaining a construction lien against the landlord’s property interest due to terms of lease, which did not require tenant to make improvements that “did not constitute the pith of the lease,” was allowed to obtain a judgment against the landlord on the basis of “unjust enrichment” as measured by the unpaid costs of the improvements (but not for the “enhanced value” of the subsequent rental to another tenant of increased rental amount). Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

Earth Trades v. T & G , 35 Fla. L. Weekly D1937b (August 27, 2010): General contractor’s alleged knowledge that subcontractor was unlicensed would not be an affirmative defense for owner under section 489.128, F. S., as amended in 2003 to add subsection (3), which provides, in part: “The section shall not affect the rights of parties other than the unlicensed contractor to enforce contract, lien or bond remedies.” Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

MM II v. Silvester , Florida 4th DCA (August 18, 2010): In a breach of contract dispute between homeowner and installer of audio equipment, it was determined that NO contractor or electrical contractor license was required even though the audio wiring involves low voltage electricity. Accordingly, the contractor was NOT “unlicensed” and could enforce the contract. Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

A final order was issued by the Florida CILB on February 3, 2011, responding to a Petition for Declaratory Statement received on July 12, 2010, from Jacqueline Watts, interpreting s. 489.105(3)(f), (g), (i) and (m), F. S., and determining that installing and servicing of LP gas appliance, including disconnection, reconnection and repair, are within the scope of an Air Conditioning (A and B), Mechanical and Plumbing licenses. Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

MGM Construction Services Corp., vs. Travelers Casualty & Surety Co. of America, et al., Case No. 3D10-203, filed March 2, 2011: Summary judgment against an unlicensed subcontractor was reversed and remanded in order to allow the trial court to consider specified public policy factors, where only licensure requirement was pursuant to local county ordinance (Miami-Dade), which, unlike s. 489.128, F. S., did not contain any provision regarding contract non-enforceability. In rejecting the contractor’s argument that a contract entered into in violation of law (the ordinance) was void, the court noted that “in the absence of legislative direction, a hard and fast rule declaring contracts unenforceable is bound to result in inequitable or absurd outcomes in certain situation, and that some flexibility in the decision-making process is required.” Instead, the court noted that s. 489.128(1)(a) had been amended effective October 1, 2009, after the case had begun, to provide that a contrac

Carlos M. Arteaga v. Florida Department of Business and Professional Regulation, Regulatory Council of Community Association Managers , Case No 3D10-1419, L.T. Case No. 07-68175, filed February 16, 2011: Licensed community association manager responded to service of an administrative complaint by faxing an election of rights form to the department requesting a formal hearing on charges that he had violated the practice act. While the licensee’s signature on the form was notarized dated within the required 21-day response time, which was the same date licensee claims to have faxed the form, there was no fax confirmation report and the department denied ever receiving it; as a result. After licensee moved to vacate a “final order on wavier” revoking his license, he filed a protective notice of appeal; however, the appeal was dismissed based on a joint stipulation to vacate the order, subject to DBPR approval. While DBPR subsequently disapproved that stipulation, it did not object to the

L & H Construction Company, Inc., v. Circle Redmont, Inc., Case No. 5D-09-3450, filed February 4, 2011: Final judgment finding contractor in breach of its subcontract with stairs manufacturer was reversed. While appellate court agreed that the contract terms were ambiguous regarding subcontractor’s duty to perform installation of the stairs, and parole evidence of the parties’ intent was properly admitted, it found the trial court’s exclusion of evidence of what transpired after the dispute arose resulted in insufficient evidence to support the finding that the contractor had breached the contract. Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

Glenn Rasmussen Fogarty & Hooker, P.A. is proud to announce that its Construction Law Group was named Corporate INTL Magazine’s “Construction Law Firm of the Year in Florida” for 2010. Construction Law Group Shareholders: Trenton H. Cotney George E. Spofford, IV Firms were researched by an independent team looking at service range, business type, geographical location, how the business operates, and the expertise each team can offer to companies. The 2010 Awards have commemorated those who have been active over the past 12 months and who have shown excellence not only in expertise but also in service during a difficult global economic downturn. For more information, please go to www.glennrasmussen.com/news_detail.aspx?id=98 Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com

 Davis Bacon Form WH-347  Question: I pay my workers on a bi-weekly basis. Do I have to submit weekly certified payrolls on a Davis Bacon Act project? Answer: Yes, there is no exception to the requirement that a contractor/subcontractor submit a certified weekly payroll if work has been performed. The contractor/subcontractor can add comments in the "Remarks" section on the second page of the WH-347 form that can explain the methods used to arrive at the weekly payroll. Trenton H. Cotney Board Certified in Construction Law Trent Cotney, P.A. 1207 N Franklin St, Ste 222 Tampa, FL 33602 (813) 579-3278 www.trentcotney.com