Florida Supreme Court Amends Summary Judgment Rule Effective May 1, 2021

Division 1 member, Richard Asfar, Partner at Cotney Construction Law, Tampa, Florida, sent us this rule update issued on New Year's Eve by the Florida Supreme Court.  

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For decades, Florida’s summary judgment standard has been among the most stringent in the Country. One intermediate Florida District Court of Appeal has explained that under that standard, “The burden is on the moving party to demonstrate conclusively that the nonmoving party cannot prevail,” and that summary judgment is improper where “the record reflects the existence of any genuine issue of material fact, or the possibility of any issue, or if the record raises even the slightest doubt that an issue might exist[.]” Snyder v. Cheezem Development Corp., 373 So. 2d 719 (Fla. 2d DCA 1979) (emphasis supplied). As a result, Florida lien claims and construction defect claims are less likely to be resolved in whole or part by summary judgment.

That all changed on New Year’s Eve, when the Florida Supreme Court announced it was amending the Florida rule of procedure governing summary judgment motions, Florida Rule of Civil Procedure 1.510. As amended, Florida’s summary judgment rule “shall be construed and applied in accordance with the federal summary judgment standard articulated in Celotex Corp. v. Catrett, 477 U.S. 317 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986); and Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986).” The amended rule goes into effect on May 1, 2021.

The Florida Supreme Court did not engage in a stare decisis analysis when amending Florida’s summary judgment rule, but it did note that the amendment “align[s] Florida’s summary judgment standard with that of the federal courts and of the supermajority of states that have already adopted the federal summary judgment standard.” In re: Amendments to Florida Rule of Civil Procedure 1.510, Case No. SC20-1490 at *2 (Fla. Dec. 31, 2020).

The rule change should reduce Florida movants’ summary judgment burden. Significantly, movants will no longer be required “to conclusively negate an opposing party's claim before the burden shifts to the nonmoving party.” See, Wendel v. Mease Hospital, Inc., 291 So. 3d 1000, 1001-02 (Fla. 2d DCA 2020) (citing Celotex Corp. v. Catrett, supra). Also, the amended standard will permit the trial court to “assess the proof and ‘where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial.’ ” Lopez v. Wilsonart, LLC, 275 So. 3d 831, 834 n.1 (Fla. 5th DCA 2019) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. at 587). The upshot for construction attorneys is that the amended Florida summary judgment standard will result in more Florida lien claims and construction defect claims being resolved at least in part by summary judgment.

The Florida Supreme Court has not yet expressly stated how or whether the rule change will apply to existing cases. But generally, in Florida, procedural or remedial changes “are to be applied retrospectively and are to be applied to pending cases.” Alamo Rent-a-Car, Inc. v. Mancusi, 632 So. 2d 1352, 1358 (Fla. 1994). Also, in a companion case, the Florida Supreme Court noted that it was affirming the reversal of a defendant’s summary judgment under the old Florida standard “without prejudice to the [movant’s] ability to seek summary judgment under Florida’s new summary judgment standard, once our rule amendment takes effect.” Wilsonart, LLC v. Lopez, No. SC19-1336 (Fla. Dec. 31, 2020). Accordingly, Florida construction attorneys should be prepared to have this rule change apply to all cases, even cases that have been pending for years, on May 1, 2021.

Common Law Implied Warranties in Construction

When dealing with construction defects, lawyers seeking recovery on behalf of owners often turn to implied warranties arising under state law to provide grounds for an owner to recover for losses that otherwise might not be recoverable. Such situations arise often when the "owner" has changed from being a developer in direct privity with a contractor to being a condominium or homeowners' association with no privity.  

Today's discussion relating to this topic specifically in Florida -- but providing food for thought elsewhere also -- come from Division 1 member Jason M. Rodgers-da Cruz of Siegfried, Rivera, Hyman, Lerner, De La Torre, Mars & Sobel, P.A. of Coral Gables, Florida.  Jason's practice relates specifically to construction defect claims that often are raised on behalf of condominium associations.  This article discusses a Florida Supreme Court decision issued late last year called Maronda Homes, Inc. v. Lakeview Reserve Homeowners Ass'n, 127 So. 3d 1258 (Fla. 2013). 

(Note: There are four footnotes in this article, which are denoted with a bracketed number: e.g., [1].)

Florida’s Common Law Implied Warranties: A brief review of the scope and application of Florida’s common law implied warranties. 

In representing a purchaser, developer or a developer/builder involved in a warranty dispute pertaining to a residence in the State of Florida, consider the Florida Supreme Court’s most recent ruling concerning the scope and application of common law implied warranties in Maronda Homes, Inc. v. Lakeview Reserve Homeowners Ass’n,  127 So. 3d 1258 (Fla. 2013).

In Maronda, a homeowner’s association filed suit against its developer for breach of common law implied warranties for a defective storm water drainage system serving the entire property. The association experienced buckling, splitting of pavement and asphalt, excessive flooding, soil erosion, mosquito infestation and swamp-like conditions, which directly affected the homes and access to the homes. 

The developer filed a third party action against the contractor seeking indemnification for the allegations raised by the association. The developer and the contractor filed a motion for summary judgment against the association, and relied, in part, on the Fourth District Court of Appeal’s application of common law implied warranties in Port Seawall Harbor & Tennis Club Owners Association, Inc. v. First Federal Savings & Loan Association of Martin County, 463 So. 2d 530 (Fla. 4^th DCA 1985).  They argued that the defects did not meet the elements required for asserting common law implied warranties because the alleged defects did not immediately support the residences.[1]  

The trial court agreed with the developer and contractor and granted the motion for summary judgment.  The association appealed to the Fifth District Court of Appeal.  The Fifth District reversed the trial court and certified a conflict (to the Florida Supreme Court) with the Fourth District’s application of common law implied warranties in Port Seawall.  An appeal to the Florida Supreme Court ensued.   

The Florida Supreme Court conducted a historical review of the rationale and standards supporting common law implied warranties, including 1) the privity requirement between the seller and the owner,[2]  and 2) that common law warranties were not extended to investors. [3]  

The court then adopted the standard set forth by the Fifth District, known as the “’essential services’” standard.  The essential services standard provides that if the improvement provides an essential service to the habitability of the residence, then common law implied warranties apply. Conversely, if the improvement does not provide essential services to the residence, then the common law implied warranties do not apply. Further, the improvements need not be physically attached to the homes but rather provide essential services to the habitability of the home.  The court opined that the essential services standard is consistent with the “Florida requirement that the implied warranties apply to improvements that are ’immediately supporting’ a residence.”  However, the court noted that essential services do not include “items that provide mere convenience or aesthetic beauty, such as landscaping, sprinkler systems, recreational facilities or other similar improvements.”

The court also addressed the Florida Legislature’s attempt to limit common law implied warranties in Section 553.835, Florida Statutes. [4]   The legislative impetus for enacting Section 553.835, can be found in Section 553.835(1):

[t]he Legislature finds that the courts have reached different conclusions concerning the scope and extent of the common law doctrine or theory of implied warranty of fitness and merchantability or habitability for improvements immediately supporting the structure of a new home, which creates uncertainty in the state’s fragile real estate and construction industry.

Section 553.835(4) specifically limits common law implied warranties as a cause of action for an offsite improvement.  Section 553.835(4) provides, in part, that: 

[t]here is no cause of action in law or equity available to a purchaser of a home or to a homeowners’ association based upon the doctrine or theory of implied warranty of fitness and merchantability or habitability for damages to offsite improvements…

Although the court briefly reviewed the Legislature’s definition of an offsite improvement, it primarily focused on whether the statute could be retroactively applied. The Court held that the statute could not be retroactively applied as the Legislature attempted to limit vested common law implied warranties.  The court opined that Section 553.835 violated the right of access to the courts and that the Legislature’s attempt was a “clear violation of separation of powers because the Legislature does not sit as a supervising appellate court over our district courts of appeal.”  Accordingly, Section 553.835 “does not apply to any causes of action that accrued before the effective date of this section.”

In closing, if you are litigating in a jurisdiction that allows for common law implied warranties, consider: 1) the scope of the warranty; 2) to whom the warranty extends; 3) whether the legislature has attempted to limit those warranties; and 4) although not addressed in this article, whether those warranties can be or have been disclaimed.

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[1]Port Seawall Harbor & Tennis Club Owners Association, Inc. v. First Federal Savings & Loan Association of Martin County, 463 So. 2d 530 (Fla. 4^th DCA 1985)(declined to extend common law implied warranties to the facts in the case because "[t]he foot bridge in question and the defective work complained of involved roads and drainage in the subdivision and did not pertain to the "construction of homes or other improvements immediately supporting the residences.")

[2] Gable v. Silver, 264 So. 2d 418 (Fla. 1972).

[3] Conklin v. Hurley, 428 So. 2d 654 (Fla. 1983).

[4] The Florida Legislature enacted Section 553.835, Florida Statutes, on July 1, 2012, and intended for the statute to apply retroactively.