Bill Text: FL S1098 | 2014 | Regular Session | Comm Sub


Bill Title: Florida Homeowners' Construction Recovery Fund

Spectrum: Bipartisan Bill

Status: (Failed) 2014-05-02 - Died in Appropriations [S1098 Detail]

Download: Florida-2014-S1098-Comm_Sub.html
       Florida Senate - 2014                             CS for SB 1098
       
       
        
       By the Committee on Regulated Industries; and Senator Dean
       
       
       
       
       
       580-02896-14                                          20141098c1
    1                        A bill to be entitled                      
    2         An act relating to the Florida Homeowners’
    3         Construction Recovery Fund; amending s. 489.1401,
    4         F.S.; clarifying legislative intent; making technical
    5         changes; amending s. 489.1402, F.S.; redefining terms;
    6         amending s. 489.141, F.S.; revising conditions under
    7         which a claimant is eligible to seek recovery from the
    8         recovery fund; amending s. 489.1425, F.S.; revising
    9         the form required to be provided by a contractor which
   10         explains a consumer’s rights under the recovery fund;
   11         amending s. 489.143, F.S.; prohibiting fund
   12         disbursements from exceeding a specified amount for
   13         each Division I claim and each Division II claim;
   14         providing an effective date.
   15          
   16  Be It Enacted by the Legislature of the State of Florida:
   17  
   18         Section 1. Subsections (2) and (3) of section 489.1401,
   19  Florida Statutes, are amended to read:
   20         489.1401 Legislative intent.—
   21         (2) It is the intent of the Legislature that the sole
   22  purpose of the Florida Homeowners’ Construction Recovery Fund is
   23  to compensate an any aggrieved claimant who contracted for the
   24  construction or improvement of the homeowner’s residence located
   25  within this state and who has obtained a final judgment in any
   26  court of competent jurisdiction, was awarded restitution by the
   27  Construction Industry Licensing Board, or received an award in
   28  arbitration against a licensee on grounds of financial
   29  mismanagement or misconduct, abandoning a construction project,
   30  or making a false statement with respect to a project. Such
   31  grievance must arise and arising directly out of a any
   32  transaction conducted when the judgment debtor was licensed and
   33  must involve an act performed any of the activities enumerated
   34  under s. 489.129(1)(g), (j) or (k) on the homeowner’s residence.
   35         (3) It is the intent of the Legislature that Division I and
   36  Division II contractors set apart funds for the specific
   37  objective of participating in the fund.
   38         Section 2. Paragraphs (d), (i), (k), and (l) of subsection
   39  (1) of section 489.1402, Florida Statutes, are amended to read:
   40         489.1402 Homeowners’ Construction Recovery Fund;
   41  definitions.—
   42         (1) The following definitions apply to ss. 489.140-489.144:
   43         (d) “Contractor” means a Division I or a Division II
   44  contractor performing his or her respective services described
   45  in s. 489.105(3)(a)-(q) s. 489.105(3)(a)-(c).
   46         (i) “Residence” means a single-family residence, an
   47  individual residential condominium or cooperative unit, or a
   48  residential building containing not more than two residential
   49  units in which the owner contracting for the improvement is
   50  residing or will reside 6 months or more each calendar year upon
   51  completion of the improvement.
   52         (k) “Same transaction” means a contract, or a any series of
   53  contracts, between a claimant and a contractor or qualified
   54  business, when such contract or contracts involve the same
   55  property or contiguous properties and are entered into either at
   56  one time or serially.
   57         (l) “Valid and current license,” for the purpose of s.
   58  489.141(2)(d), means a any license issued pursuant to this part
   59  to a licensee, including a license in an active, inactive,
   60  delinquent, or suspended status.
   61         Section 3. Subsections (1) and (2) of section 489.141,
   62  Florida Statutes, are amended to read:
   63         489.141 Conditions for recovery; eligibility.—
   64         (1) A Any claimant is eligible to seek recovery from the
   65  recovery fund after making having made a claim and exhausting
   66  the limits of any available bond, cash bond, surety, guarantee,
   67  warranty, letter of credit, or policy of insurance, if provided
   68  that each of the following conditions is satisfied:
   69         (a) The claimant has received final judgment in a court of
   70  competent jurisdiction in this state or has received an award in
   71  arbitration or the Construction Industry Licensing Board has
   72  issued a final order directing the licensee to pay restitution
   73  to the claimant. The board may waive this requirement if:
   74         1. The claimant is unable to secure a final judgment
   75  against the licensee due to the death of the licensee; or
   76         2. The claimant has sought to have assets involving the
   77  transaction that gave rise to the claim removed from the
   78  bankruptcy proceedings so that the matter might be heard in a
   79  court of competent jurisdiction in this state and, after due
   80  diligence, the claimant is precluded by action of the bankruptcy
   81  court from securing a final judgment against the licensee.
   82         (b) The judgment, award, or restitution is based upon a
   83  violation of s. 489.129(1)(g), (j), or (k) or s. 713.35.
   84         (c) The violation was committed by a licensee.
   85         (d) The judgment, award, or restitution order specifies the
   86  actual damages suffered as a consequence of such violation.
   87         (e) The contract was executed and the violation occurred on
   88  or after July 1, 1993, and provided that:
   89         1. The claimant has caused to be issued a writ of execution
   90  upon such judgment, and the officer executing the writ has made
   91  a return showing that no personal or real property of the
   92  judgment debtor or licensee liable to be levied upon in
   93  satisfaction of the judgment can be found or that the amount
   94  realized on the sale of the judgment debtor’s or licensee’s
   95  property pursuant to such execution was insufficient to satisfy
   96  the judgment;
   97         2. If the claimant is unable to comply with subparagraph 1.
   98  for a valid reason to be determined by the board, the claimant
   99  has made all reasonable searches and inquiries to ascertain
  100  whether the judgment debtor or licensee is possessed of real or
  101  personal property or other assets subject to being sold or
  102  applied in satisfaction of the judgment and by his or her search
  103  has discovered no property or assets or has discovered property
  104  and assets and has taken all necessary action and proceedings
  105  for the application thereof to the judgment but the amount
  106  thereby realized was insufficient to satisfy the judgment; and
  107         3. The claimant has made a diligent attempt, as defined by
  108  board rule, to collect the restitution awarded by the board.
  109         (f) A claim for recovery is made within 1 year after the
  110  conclusion of any civil, criminal, or administrative action or
  111  award in arbitration based on the act. This paragraph applies to
  112  any claim filed with the board after October 1, 1998.
  113         (g) Any amounts recovered by the claimant from the judgment
  114  debtor or licensee, or from any other source, have been applied
  115  to the damages awarded by the court or the amount of restitution
  116  ordered by the board.
  117         (h) The claimant is not a person who is precluded by this
  118  act from making a claim for recovery.
  119         (2) A claimant is not qualified to make a claim for
  120  recovery from the recovery fund, if:
  121         (a) The claimant is the spouse of the judgment debtor or
  122  licensee or a personal representative of such spouse;
  123         (b) The claimant is a licensee who acted as the contractor
  124  in the transaction that which is the subject of the claim;
  125         (c) The claim is based upon a construction contract in
  126  which the licensee was acting with respect to the property owned
  127  or controlled by the licensee;
  128         (d) The claim is based upon a construction contract in
  129  which the contractor did not hold a valid and current license at
  130  the time of the construction contract;
  131         (e) The claimant was associated in a business relationship
  132  with the licensee other than the contract at issue;
  133         (f) The claimant has suffered damages as the result of
  134  making improper payments to a contractor as defined in part I of
  135  chapter 713 on contracts entered into before July 1, 2014; or
  136         (g) The claimant has contracted with a licensee to perform
  137  a scope of work described in s. 489.105(3)(d)-(p) on contracts
  138  entered into before July 1, 2014.
  139         Section 4. Subsection (1) of section 489.1425, Florida
  140  Statutes, is amended to read:
  141         489.1425 Duty of contractor to notify residential property
  142  owner of recovery fund.—
  143         (1) Each Any agreement or contract for repair, restoration,
  144  improvement, or construction to residential real property must
  145  contain a written statement explaining the consumer’s rights
  146  under the recovery fund, except where the value of all labor and
  147  materials does not exceed $2,500. The written statement must be
  148  substantially in the following form:
  149  
  150                  FLORIDA HOMEOWNERS’ CONSTRUCTION                 
  151                            RECOVERY FUND                          
  152  
  153         PAYMENT, UP TO A LIMITED AMOUNT, MAY BE AVAILABLE FROM
  154         THE FLORIDA HOMEOWNERS’ CONSTRUCTION RECOVERY FUND IF
  155         YOU LOSE MONEY ON A PROJECT PERFORMED UNDER CONTRACT,
  156         WHERE THE LOSS RESULTS FROM SPECIFIED VIOLATIONS OF
  157         FLORIDA LAW BY A LICENSED CONTRACTOR. FOR INFORMATION
  158         ABOUT THE RECOVERY FUND AND FILING A CLAIM, CONTACT
  159         THE FLORIDA CONSTRUCTION INDUSTRY LICENSING BOARD AT
  160         THE FOLLOWING TELEPHONE NUMBER AND ADDRESS:
  161  
  162  The statement must shall be immediately followed by the board’s
  163  address and telephone number as established by board rule.
  164         Section 5. Section 489.143, Florida Statutes, is amended to
  165  read:
  166         489.143 Payment from the fund.—
  167         (1) The fund shall be disbursed as provided in s. 489.141
  168  on a final order of the board.
  169         (2) A Any claimant who meets all of the conditions
  170  prescribed in s. 489.141 may apply to the board to cause payment
  171  to be made to a claimant from the recovery fund in an amount
  172  equal to the judgment, award, or restitution order or $25,000,
  173  whichever is less, or an amount equal to the unsatisfied portion
  174  of such person’s judgment, award, or restitution order, but only
  175  to the extent and amount of actual damages suffered by the
  176  claimant, and only up to the maximum payment allowed for each
  177  respective Division I and Division II claim. Payment from the
  178  fund for other costs related to or pursuant to civil proceedings
  179  such as postjudgment interest, attorney attorney’s fees, court
  180  costs, medical damages, and punitive damages is prohibited. The
  181  recovery fund is not obligated to pay a any judgment, an award,
  182  or a restitution order, or any portion thereof, which is not
  183  expressly based on one of the grounds for recovery set forth in
  184  s. 489.141.
  185         (3) Beginning January 1, 2005, for each Division I contract
  186  entered into after July 1, 2004, payment from the recovery fund
  187  shall be subject to a $50,000 maximum payment for each Division
  188  I claim. Beginning January 1, 2015, for each Division II
  189  contract entered into on or after July 1, 2014, payment from the
  190  recovery fund shall be subject to a $15,000 maximum payment for
  191  each Division II claim.
  192         (4)(3) Upon receipt by a claimant under subsection (2) of
  193  payment from the recovery fund, the claimant shall assign his or
  194  her additional right, title, and interest in the judgment,
  195  award, or restitution order, to the extent of such payment, to
  196  the board, and thereupon the board shall be subrogated to the
  197  right, title, and interest of the claimant; and any amount
  198  subsequently recovered on the judgment, award, or restitution
  199  order, to the extent of the right, title, and interest of the
  200  board therein, shall be for the purpose of reimbursing the
  201  recovery fund.
  202         (5)(4) Payments for claims arising out of the same
  203  transaction shall be limited, in the aggregate, to the lesser of
  204  the judgment, award, or restitution order or the maximum payment
  205  allowed, for a Division I claim or a Division II claim
  206  regardless of the number of claimants involved in the
  207  transaction.
  208         (6)(5)For contracts entered into before July 1, 2004,
  209  payments for claims against any one licensee may shall not
  210  exceed, in the aggregate, $100,000 annually, up to a total
  211  aggregate of $250,000. For any claim approved by the board which
  212  is in excess of the annual cap, the amount in excess of $100,000
  213  up to the total aggregate cap of $250,000 is eligible for
  214  payment in the next and succeeding fiscal years, but only after
  215  all claims for the then-current calendar year have been paid.
  216  Payments may not exceed the aggregate annual or per claimant
  217  limits under law. Beginning January 1, 2005, for each Division I
  218  contract entered into after July 1, 2004, payment from the
  219  recovery fund is subject only to a total aggregate cap of
  220  $500,000 for each Division I licensee. Beginning January 1,
  221  2015, for each Division II contract entered into on or after
  222  July 1, 2014, payment from the recovery fund is subject only to
  223  a total aggregate cap of $150,000 for each Division II licensee.
  224         (7)(6) Claims shall be paid in the order filed, up to the
  225  aggregate limits for each transaction and licensee and to the
  226  limits of the amount appropriated to pay claims against the fund
  227  for the fiscal year in which the claims were filed. Payments may
  228  not exceed the total aggregate cap per licensee or per claimant
  229  limits under this section.
  230         (8)(7) If the annual appropriation is exhausted with claims
  231  pending, such claims shall be carried forward to the next fiscal
  232  year. Any moneys in excess of pending claims remaining in the
  233  recovery fund at the end of the fiscal year shall be paid as
  234  provided in s. 468.631.
  235         (9)(8) Upon the payment of any amount from the recovery
  236  fund in settlement of a claim in satisfaction of a judgment,
  237  award, or restitution order against a licensee as described in
  238  s. 489.141, the license of such licensee shall be automatically
  239  suspended, without further administrative action, upon the date
  240  of payment from the fund. The license of such licensee may shall
  241  not be reinstated until he or she has repaid in full, plus
  242  interest, the amount paid from the fund. A discharge of
  243  bankruptcy does not relieve a person from the penalties and
  244  disabilities provided in this section.
  245         (10)(9)A Any firm, a corporation, a partnership, or an
  246  association, or a any person acting in his or her individual
  247  capacity, who aids, abets, solicits, or conspires with another
  248  any person to knowingly present or cause to be presented a any
  249  false or fraudulent claim for the payment of a loss under this
  250  act is guilty of a third-degree felony, punishable as provided
  251  in s. 775.082 or s. 775.084 and by a fine of up to not exceeding
  252  $30,000, unless the value of the fraud exceeds that amount,
  253  $30,000 in which event the fine may not exceed double the value
  254  of the fraud.
  255         (11)(10)All Payments and disbursements from the recovery
  256  fund shall be made by the Chief Financial Officer upon a voucher
  257  signed by the secretary of the department or the secretary’s
  258  designee.
  259         Section 6. This act shall take effect July 1, 2014.

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