Newly Enacted Legislation Rewrites Florida's Rules On Individual Design Professional Liability

James Ramsey is an Associate and Monte Starr is a Partner in our Orlando office

Law Permits Businesses Providing Professional Services to Limit the Liability of Individual Employees or Agents

A new law will soon go into effect in Florida that will impact anyone doing business with design professionals in that state.

Ever since Moransais v. Heathman, 744 So. 2d 973 (Fla. 1999), Florida courts have recognized that individual professionals could be held liable to third parties for their negligence in the performance of a contract entered into by their employer. In Witt v. La Gorce Country Club, Inc., 35 So. 3d 1033 (Fla. 3d DCA 2010), the Third District Court of Appeal expanded that liability to rule that as a matter of law, limitation of liability provisions in professional services contracts were not enforceable to insulate individual professionals from liability.

On April 24, 2013, Governor Rick Scott approved Senate Bill 286, which will effectively abrogate the holding of Witt and permit business entities providing professional services to limit by contract the liability of their individual employees or agents. Under the newly created Florida Statute 558.0035, effective July 1, 2013, an individual design professional (identified in the new statute as an architect, interior designer, landscape architect, engineer, surveyor or geologist) can be protected from individual liability for negligence under each of the following circumstances:

1. the contract is made between the business entity and a claimant or with another entity for the provision of professional services to the claimant

2. the contract does not name as a party to the contract the individual employee or agent who will perform the professional services

3. the contract includes a prominent statement, in uppercase font that is at least five point sizes larger than the rest of the text, that, pursuant to this section, an individual employee or agent may not be held individually liable for negligence

4. the business entity maintains any professional liability insurance required under the contract

5. any damages are solely economic in nature and the damages do not extend to personal injuries or property not...