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Florida’s Implied Warranty of Merchantability

When engaging in the sale of goods within Florida, both buyers and sellers should be aware of the legal landscape governing these transactions. Florida’s Uniform Commercial Code (UCC), specifically Chapter 672 of the Florida Statutes, plays a pivotal role in regulating sales. One important aspect of the UCC is the implied warranty of merchantability, which can impact both parties in a transaction.

Florida’s Uniform Commercial Code: An Overview

Chapter 672 of the Florida Statutes, also known as Florida’s Uniform Commercial Code, provides a comprehensive set of laws that generally applies to the sale of goods. This chapter is designed to facilitate commerce by offering consistent and predictable rules. Whether you are a buyer or a seller, understanding the UCC is important for navigating the complexities of commercial transactions.

Default, Gap-Filling Rules

One of the primary functions of the UCC is to provide default, gap-filling rules. These rules are intended to fill in terms that a contract may not explicitly specify. For instance, if a sales contract does not mention a delivery time, the UCC provides default provisions to determine when delivery should occur. This feature ensures that even incomplete contracts can function effectively, providing a safety net for both parties.

Supremacy of Express Terms

While the UCC offers a framework of default rules, it generally does not override or supersede the express terms of a contract. If a contract explicitly states certain terms or limitations, those terms generally take precedence over the default provisions of the UCC. This principle upholds the autonomy of the contracting parties, allowing them to tailor their agreements to specific needs and circumstances.

Implied Warranty of Merchantability: Section 672.314

Section 672.314 of the Florida Statutes establishes an implied warranty of merchantability. This warranty is automatically included in a contract for the sale of goods if the seller is a merchant with respect to those goods. The warranty essentially guarantees that the goods sold will meet certain minimum standards of quality and functionality.

To be deemed merchantable, goods must meet several criteria:

Pass Without Objection: The goods must pass without objection in the trade under the contract description.
Fair Average Quality: For fungible goods, they must be of fair average quality within the description.
Fitness for Ordinary Purposes: The goods must be fit for the ordinary purposes for which such goods are used.
Even Kind, Quality, and Quantity: The goods must run, within variations permitted by the agreement, of even kind, quality, and quantity within each unit and among all units involved.
Adequate Containment, Packaging, and Labeling: The goods must be adequately contained, packaged, and labeled as required by the agreement.
Conformity to Promises or Affirmations: The goods must conform to the promises or affirmations of fact made on the container or label, if any.

Additionally, other implied warranties may arise from the course of dealing or usage of trade, unless excluded or modified, per Section 672.316, Florida Statutes.

Practical Example

To illustrate the application of the implied warranty of merchantability, consider a scenario where a company sells a construction boom lift to another business. After the purchase, the buyer discovers that the hydraulic system of the boom lift is defective, rendering it unusable for its intended purpose.

In this situation, the implied warranty of merchantability likely comes into play. If the seller is a merchant dealing in construction equipment, the law implies that the boom lift should be fit for its ordinary purpose—safe and effective lifting operations. The defective hydraulic system clearly breaches this warranty, as the boom lift does not meet the minimum standards of quality and functionality expected in the trade.

The buyer, therefore, has legal grounds to seek remedies under the UCC, which may include repair, replacement, or even rescission of the contract and a refund.

Closing

Understanding the implied warranty of merchantability under Florida’s UCC is crucial for both buyers and sellers. This warranty ensures that goods sold by merchants meet minimum quality standards, providing protection and assurance in commercial transactions. By being aware of these legal provisions, parties can better navigate their contracts and protect their interests effectively.

DISCLAIMER: The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only.

About the Author: Ready Legal is a business law firm located in Orlando, Florida. Ready Legal primarily assists clients with civil litigation matters, such as construction lien and bond claims, business litigation, and real estate litigation. Ready Legal also helps Orange County businesses with evictions, contract negotiations, and a variety of commercial matters. If you are in need of a construction or business attorney in Orlando, Florida, contact Ready Legal at (407) 258-2002.

Owner’s Guide to Resolving Construction Disputes

Disputes between contractors and property owners are common. They often revolve around issues such as defective construction, project delays, or change orders. When both agree to resolve these disputes before heading to court, the resolution typically involves some form of settlement where the property owner agrees to pay part or all of the remaining contract balance. In exchange, the contractor provides a release of claims for payment.

However, there’s a prevalent misconception that property owners should also provide a broad release of their claims against the contractor. This is typically not warranted, and for property owners, is usually not a good idea.

The Role of Releases in Settlements

When a property owner agrees to pay a contractor, the contractor usually provides a lien release. This is a legal document that waives the contractor’s right to file a mechanic’s lien against the property for the amount paid. Sometimes, a property owner may also demand a general release, where the contractor waives claims for payment under the contract. This ensures that once the payment is made, the contractor cannot come back later demanding more money.

The Property Owner’s Perspective

From the property owner’s standpoint, agreeing to pay money under a settlement does not mean relinquishing all their rights, especially concerning the quality and integrity of the work performed. It is important for property owners to maintain their warranty rights and other protections for the work they are paying for. This means expecting the contractor to stand behind their work, even if both parties settle an existing dispute.

Customary Practices in Construction Law

In construction, it is uncommon for property owners to provide a comprehensive release of claims against contractors for work that has been paid for. The primary reasons are:

Warranty Rights Continue: Property owners typically retain their warranty rights, ensuring that the contractor remains accountable for the quality and durability of the work that is paid for. A broad release could void these protections, leaving the property owner vulnerable to unresolved defects.
Known Defects are Waived: If a property owner provides any release, it is usually limited to specific issues that are being directly addressed by the settlement. For instance, if there is a known defect and the settlement includes rectifying that issue, the property owner might release claims for that specific defect.
Unknown Defects are Not Waived: A blanket release should not be used to prevent property owners from pursuing future claims for defects or issues that were not apparent at the time of settlement.

Tips for Property Owners

Given these considerations, property owners should be cautious about signing broad releases. Here are a few tips:

Consult Legal Counsel: Always consult with a construction attorney before agreeing to sign a release. Legal counsel can help ensure that your rights are protected and that you are not inadvertently waiving important protections.
Specificity in Releases: If a release is necessary, make sure it is narrowly tailored to cover only specific issues that are being resolved by the settlement. Avoid broad language that could be interpreted as waiving all claims.
Documentation: Keep detailed records of all communications, agreements, and work performed. This can be invaluable if disputes arise later on.

While settling disputes out of court is often beneficial for both property owners and contractors, it is crucial to understand the implications of releases in these settlements. Property owners should be wary of providing broad releases and should strive to maintain their rights and protections regarding the quality and warranty of the work.

Litigating Critical Path Delays in Construction

In construction projects, time management is crucial for successful completion. A key concept in project management is the “critical path,” which helps to set the project’s schedule and determine its completion time. Understanding the critical path and how delays can impact it helps parties manage potential issues and navigate disputes that may arise.

What is the Critical Path in Construction?

The critical path is the series of tasks that determine the shortest time to complete a construction project. These tasks are connected, so a delay in one affects the others and can push back the project’s overall completion date. Tasks not on the critical path may have some flexibility without impacting the project timeline.

How Delays to the Critical Path Impact the Main Effort

Delays to the critical path can disrupt the project’s schedule, causing missed deadlines and extra costs. For instance, if a crucial concrete pour is delayed due to a supply issue, it can push back framing and finishing work, extending the completion date. This can affect contractual obligations and potentially strain relationships with customers and other stakeholders.

Litigating Delay Claims in Construction Lawsuits

When critical path delays happen, disputes may arise over who is responsible for the delay and the costs involved. In construction lawsuits, delay claims are often central to the dispute. Courts must determine which party is at fault for the delay. If a contractor, subcontractor, supplier, or another party fails to meet their obligations, they may be held liable for the impact on the critical path.

To prove a successful delay claim, parties may need to show evidence that specific events caused delays to the critical path. This requires keeping detailed documentation of the project’s schedule, progress, and any changes or disruptions. Once the delay is established, parties must quantify the damages caused by the delay, such as extended labor, equipment rental, or contractual penalties.

Courts may also consider whether the affected party took reasonable steps to reduce the delay’s impact. If a party failed to act responsibly in minimizing the delay, they may not receive full compensation. Construction contracts often include clauses related to delays, such as “no-damage-for-delay” provisions, which may limit a party’s ability to seek compensation for delays. The enforceability of these clauses can vary based on the jurisdiction and the specific contract language.

Proving Delays Caused to the Critical Path

To prove delays caused to the critical path, parties must present clear evidence. This includes an accurate and updated project schedule showing the original critical path and how delays altered it. Daily logs documenting work progress and any interruptions, along with communication records discussing potential delays and mitigation efforts, provide strong support for claims. Expert witnesses can also provide analysis and opinions on how delays impacted the critical path and project schedule.

Florida Passes New Law for Removing Squatters

On March 27, 2024, Governor Ron DeSantis signed HB 621, new legislation which provides homeowners with remedies against squatting, and which increases penalties on squatters. The bill becomes effective on July 1, 2024.

“We are putting an end to the squatters scam in Florida,” said Governor Ron DeSantis. “While other states are siding with the squatters, we are protecting property owners and punishing criminals looking to game the system.”

Under HB 621, a property owner can request law enforcement to immediately remove a squatter from their property if the following conditions are met:

The individual has unlawfully entered and remains on the property;
The individual has been directed to leave the property by the owner but has not done so; and
The individual is not a current or former tenant in a legal dispute.

The bill creates a new section under the Florida Statutes, codified as F.S. 82.036. Under the new section, a property owner or their agent can request the sheriff immediately remove a person unlawfully occupying a residential dwelling when certain conditions are met.

To request the immediate removal of an unlawful occupant of a residential dwelling, the property owner or agent must submit a complaint by presenting a completed and verified Complaint to Remove Persons Unlawfully Occupying Residential Real Property to the sheriff of the county in which the real property is located. Further, Section 82.036(3) provides a form complaint which must be used in connection with this request.

Although F.S. 82.063 provides a new expedited method to remove occupants, landlords who improperly use the method may subject themselves to civil or criminal penalties. Therefore, it is advisable to consult with an attorney to ensure the method is only used when it is proper to do so.

Computing Florida Lien Deadlines and Timing

In Florida, construction contractors and suppliers have various deadlines that they must adhere to for liens. For example, a contractor must record a lien within 90 days of its final furnishing of labor or materials. Likewise, a contractor must file suit to foreclose on its lien within 1 year of recording or the lien will expire. However, there are often uncertainties about when the periods for these deadlines begin or expire.

One key statute that provides important guidance on computing deadlines for liens and related filings is Florida Statute 713.011. This statute ensures that contractors and suppliers have clear rules for determining deadlines.

Computation of Time Periods

According to the statute, if the last day for performing the action, is any of the following, the deadline is extended to the end of the next business day:

a Saturday, Sunday, or holiday specified in s. 110.117(1), or
any day observed as a holiday by the clerk’s office or
any day designated as a holiday by the chief judge of the circuit.

This ensures that contractors and suppliers are not unfairly disadvantaged if a filing deadline falls on a day when the clerk’s office is closed. This extension is particularly important for contractors and suppliers, as they are given an extra time to file necessary documents.

Emergency Closures and Tolling

The statute also includes provisions for emergencies that may cause the clerk’s office to close temporarily.

If the clerk’s office is closed in response to an emergency for 1 day or more so that a contractor cannot record a document or file an action in person, the deadline to do so is tolled. When the clerk’s office reopens, the time period is extended by the number of days the clerk’s office was closed.

This provision is crucial in ensuring that contractors and suppliers are not penalized for circumstances beyond their control, such as hurricanes, which are a frequent occurrence in Florida.

Importance for Contractors and Suppliers

The rules outlined in Florida Statute Section 713.011 are vital for contractors and suppliers to understand and comply with, as they directly impact their ability to enforce their lien rights. Missing a filing deadline can mean the loss of a lien and the associated legal advantages. By being aware of the computation rules for time periods, including the extensions provided for weekends, holidays, and emergency closures, contractors and suppliers can plan their filings accordingly and avoid potential pitfalls.