S.O.L on Claims Against Subcontractors for Latent Defects

The case of Joel and Marcia Hochberg v. Thomas Carter Painting, Inc., 36 Fla.L. Weekly D1200f, addresses the point of time at which the statute of limitations begins to run in latent defects cases.  In 2000, homeowners, Joel and Marcia Hochberg, hired a general contractor to construct a new home for them, and the general contractor employed a number of subcontractors to perform certain aspects of the work.  In 2003, the Hochbergs took possession of the home, but weren’t able to move in because the homeowners immediately noticed mold in the home.

The homeowner then hired an engineer to investigate the extent of the mold problem, and the engineer presented a report to the homeowners which identified water intrusion throughout the home.  The homeowners demanded arbitration with the general contractor in 2004 in which they alleged water intrusion resulting from deficient work performed by the general contractor and its laborers, but the homeowners did not file suit against any of the subcontractors involved in the construction of the residence until 2008.

The subcontractors moved for summary judgment due to the expiration of the applicable four year statute of limitations, and the trial court granted summary judgment in the subcontractors’ favor.  Under section 95.11(3)(c), Florida Statutes, (2010) “an action founded on the design, planning or construction of an improvement to real property” must be brought within four years of the later date of the owner’s actual possession, the issuance of a certificate of occupancy, or the date of completion or termination of the contract.  The statute also provides that: “[W]hen the action involves a latent defect, the time runs from the time the defect is discovered or should have been discovered with the exercise of due diligence.”

On appeal, the homeowners argued that while they acknowledged that they were aware of the water intrusion and other construction defects since 2003 , under the latent defect provision of Section 95.11(3)(c), the statute of limitations only started to run once the homeowner discovered the precise nature of the defects, or more specifically, once the homeowner discovered that it was the negligence of the subcontractors which caused the defects.  The appellate court disagreed, noting that the law is clear that “where there is an obvious manifestation of a defect, notice will be inferred at the time of manifestation regardless of whether the plaintiff has knowledge of the exact nature of the defect.”  The appellate court held that the extent of the homeowners’ knowledge of the defects by, at the very latest in 2004, was sufficient to trigger running of the statute of limitations.  Because the homeowners alleged that there were water intrusion issues in its arbitration demand to the general contractor in 2004, the court determined that the homeowners had sufficient general knowledge of the defect issues at that time, making the date of the arbitration demand the latest conceivable date on which the statute of limitations began to toll, and therefore could not assert claims against the subcontractors.

Plaintiffs must take note of this decision and act diligently with respect to claims of which they become aware. The statute of limitations serves as an absolute bar on claims asserted untimely and claimants do not want to end up in the same position as Mr. and Mrs. Hochberg.