558 Notice Costs: Guess Who Doesn’t Have to Pay?

A recent decision by the Florida Supreme Court is being celebrated by contractors.  In what was a case of first impression not previously decided by a state court in Florida, the Supreme Court has determined that the notice and repair process set forth in Chapter 558 of Florida Statutes is a “suit” within the meaning provided in standard comprehensive general liability policies.

Over the last few years, contractors, subcontractors, and design professionals have struggled to deal with the ever-growing number of Chapter 558 notices.  Not only do these notices take up valuable time but they have become costly, with ever mounting attorney’s and consultant’s fees.  Now those fees should be paid by the recipient’s insurance carrier.

The Florida Supreme Court found that the Chapter 558 pre-suit process was, in fact, an alternative dispute resolution proceeding as generally included in a CGL policy’s definition of a suit – a significant victory for contractors, for sure.