Board-Certified In Construction Law By The Florida Bar

Bill to resolve the ‘558’ loophole dies in committee

On Behalf of | Aug 10, 2021 | Construction Law

Unfortunately, construction projects in Florida sometimes run into legal problems when an alleged property defect is uncovered. When this happens, contractors may be served with a “558” claim. The Florida Legislature recently addressed a loophole in these claims that harms those in the construction industry, but the bill ultimately died in committee.

What is the 558 loophole?

Current Florida law includes a law known as the “558” claim. A 558 claim is filed against a contractor by the property owner if there is a building defect. If the 558 claim is too broad the contractor must pass the claim on to all subcontractors that performed work in the area at issue. This can lead to demands for huge settlements and properties that go unfixed. Those in the construction industry state 558 claims are too broad.

Past attempts to address the loophole were unsuccessful

The Florida Legislature attempted to resolve this issue in 2003 by requiring the parties to a 558 claim to negotiate a settlement out-of-court before litigating the matter. However, this has not stemmed the tide of frivolous lawsuits and rising insurance premiums, costs which ultimately fall on the homebuyer’s shoulders.

Recent legislation dies in committee

Florida homebuilders are disappointed that Florida lawmakers failed to pass a bill that would fix the 558 claim loophole. The proposed bill would have limited 558 claims to those involving “material violations” that could harm an individual or significantly damage the building. Each construction defect would need to be described in “specific” detail, whereas current law only requires a “reasonable” description of each construction defect. Under the bill, plaintiffs would have to provide a minimum of one photograph of each defect along with estimates on how much it would cost to repair the problem and a description of the damage, if known. Finally, under the bill the specific location of each alleged defect would need to be identified, so the appropriate subcontractors can be included in the claim.

Learn more about construction defects

Unfortunately for those in the construction industry, this latest legislation attempting to fix the 558 claim loophole died in committee. Time will tell if future legislation will address this issue. Those in the construction industry facing legal problems can review our firm’s website on construction defects to learn more about their rights and options.