[CLC-Discussion] 553.84 damages

Thu Jun 9 12:11:28 PDT 2022

I would say the definition of “unreasonable” cannot exclude the costs of correction of building code violations; any such correction must be reasonable.  The diminution of value analysis only applies, “where the corrections involve an unreasonable destruction of the structure and a cost which is grossly disproportionate to the results obtained.”  Broward County v. CH2M Hill, 302 So.3d 895, 903 (Fla. 4th DCA 2020), quoting Kritikos v. Andersen, 125 So.3d 885, 888 (Fla. 4th DCA 2013), quoting Temple Beth Sholom & Jewish Center, Inc. v. Thyne Construction Corp., 399 So.2d 525, 526 (Fla. 2d DCA 2016).

Broward County also affirmed the damages based upon, “actual costs to remediate, redesign, and reconstruct,” reduced by costs for upgrades and improvements.  302 So.3d at 904.  The Court directed the trial court to consider “certain deductions” on remand, including the percentage of useful life the County had received, but did not address time of breach versus time of repairs.

All of which tells me that correcting building code violations can never be measured by diminution in value due to unreasonable costs.

So your question then turns to using current estimates, as opposed to actual expenditures, to correct building code violations.  Suppose your project was completed (with building code defects) in 2015, suit was filed in 2018, and you’re just now gathering estimates from experts.  Should they be forced to price the repairs using 2015 prices (with prejudgment interest to account for inflation) or 2022 prices, since the work has not been done yet?  I don’t know of any cases that solve that issue. Either way, your estimates are subject to Daubert attacks. I would imagine the more predictable and repeatable opinion would have to use 2022 prices, since 2015 would be much more speculative and inherently just guestimates.  The way around the 2015 argument would be to posit that the “breach” is measured by the 2015 Code – but since actual repairs cannot be accurately priced based on 2015 costs, the damages have to be in current value numbers.

But I’d sure ask my experts to testify about 2015 damages too!

b.

Brian F. Stayton
Stayton Law Group, P.A.
3619 Lithia Pinecrest Road
Valrico Florida 33596
Telephone: (813) 662-9829
Facsimile: (813) 662-9830
Brian at StaytonLawGroup.com
Board Certified in Construction Law

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From: clc-discussion-bounces at lists.flabarrpptl.org <clc-discussion-bounces at lists.flabarrpptl.org> on behalf of RPPTL CLC-Discussion <clc-discussion at lists.flabarrpptl.org>
Date: Thursday, June 9, 2022 at 2:39 PM
To: clc-discussion at lists.flabarrpptl.org <clc-discussion at lists.flabarrpptl.org>
Subject: Re: [CLC-Discussion] 553.84 damages
I think it's important to give weight to the part of the hypothetical involving the Florida Building Code's provisions having "the force of law."  Because violations of the FBC are required to be fixed, then the applicable measure of damages must be whatever the current cost of correction is.

In that specific scenario, a diminution of value measure of damages simply would not be a reasonable application of the law, or an effective/meaningful remedy, in my opinion.

On Thu, Jun 9, 2022 at 1:15 PM RPPTL CLC-Discussion <clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>> wrote:
Because the Economic Waste doctrine is judicially created. It should apply, absence a state statute to the contrary. While the question you have impliedly posed calls reason/logic into question, a possible legislative fix has no such burden.

From: clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org> <clc-discussion-bounces at lists.flabarrpptl.org<mailto:clc-discussion-bounces at lists.flabarrpptl.org>> On Behalf Of RPPTL CLC-Discussion
Sent: Thursday, June 9, 2022 1:06 PM
To: 'clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>' <clc-discussion at lists.flabarrpptl.org<mailto:clc-discussion at lists.flabarrpptl.org>>
Subject: [CLC-Discussion] 553.84 damages

I’m interested in others’ thoughts on this.

We know two things about breach of contract damages under Grossman Holdings: (1) that they are to be measured as of the time of the breach (Jeremy Stewart Constr., Inc. v. Matthews, 324 So. 3d 41 (Fla. 1st DCA 2021)) – with interest accruing since that time; and (2) that they are limited to diminution in value if the cost to correct would be “unreasonable economic waste.” --- BUT – what about damages under 553.84? Since the building code has the force of law, and is for the purposes of life safety, etc., wouldn’t damages for a 553.84 claim have neither of those constraints? I.e. wouldn’t they, for public policy reasons, be measured by the current cost to correct and not be limited by the economic waste constraint because the law requires their correction?

I can find zero cases or other authorities that even touch this point.

Thoughts from this august group?  Am I Don Quixote here?

Bruce Partington | Shareholder
bpartington at clarkpartington.com<mailto:bpartington at clarkpartington.com> | (850) 432-1399<callto:(850)%20432-1399>

CLARK PARTINGTON
Office: (850) 434-9200 | Fax: (850) 432-7340
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