Construction Defects and Housing

Over the past several years the people of Colorado have debated how to protect homeowners from defects in the construction of their newly purchased homes, while still giving the economy a boost and encouraging builders to continue to build and provide new and affordable multi-family housing in Colorado. Efforts last year to revise the existing laws on construction defects failed and new bills are again being introduced and debated in the Colorado Legislature.

There is a debate over whether construction defect reform is even necessary. There is an effort to cut down the existing statute of limitations or repose, or deadline, to bring a construction defect action against a construction professional to fewer years to protect builders. Yet, shortening the length of time within which a homeowner can bring a lawsuit could be a problem for the homeowner who does not learn of certain defects until some time has passed, such as after repeated rain or snow storms. There is an ongoing debate about whether such a proposed measure would only provide immunity to a builder who did not construct properly but the condition was not immediately obvious. Those who propose changes to the laws argue that the existing laws have caused condominium construction to decrease making housing out of reach for many. Opponents to reform argue that the right to sue builders and file lawsuits under the currently existing statutes have protected them from absorbing the large amount of unexpected costs to repair their homes after purchase when the builder did not voluntarily agree to remedy the situation.

The existing laws allow a homeowner to send a notice of claim letter to a construction professional such as a builder, identifying the claimed defects and their location, and provide the builder with the opportunity to inspect the property and make a monetary offer or offer to repair. If the matter is not amicably resolved between the parties, then the homeowners or homeowner association board can proceed with a lawsuit after the time limits and procedures have been followed. A proposed reform would allow a builder the right to repair whether the homeowners agreed with the proposed repair or not. Those behind such reform argue that this would knock out unnecessary lawsuits that impact the builder’s insurance and finances. Those opposed to such change argue that this would eliminate a property owner’s right to determine what can or can’t be done with his or her own property and investment and could lead to band-aid repairs that do not address the root of the problem, leaving the owners without a voice or rights in court.

The City of Lakewood has passed an ordinance adopting the concept of a builder’s “right to repair” defective work before any lawsuit can be filed by the homeowners. It requires a larger percentage of homeowners in an association to consent to a lawsuit before it can be filed by the homeowner association’s board of directors. Lakewood will be the State’s experiment of whether these proposed changes to the state-wide laws will in essence allow builders to cut corners in construction and force inadequate repairs on owners or, whether builders will adequately build and make appropriate repairs when notified of defects. Lakewood could very well be the test case on whether such a law will be found by a court of law to wrongfully eliminate a property owner’s rights.

 

Cinthia M. Manzano is a shareholder with Frascona, Joiner, Goodman and Greenstein, P.C. Her practice areas include Construction Defect, Construction, Special Needs Education Law, Real Estate, Litigation, and Association Law. Contact Cinthia Manzano.

Disclaimer — Content is general information only. Information is not provided as advice for a specific matter, nor does its publication create an attorney-client relationship. Laws vary from one state to another. For legal advice on a specific matter, consult an attorney.

CINTHIA M. MANZANO