March 2, 2007
Two Democratic legislators today plan to introduce what they are calling the Homeowner Protection Act, which they said would force home builders to abide by a four- year-old construction-defect law that builders supported.
Instead of following HB 1161, adopted in 2003, virtually all major production builders in the state are inserting nonnegotiable clauses in their sales contracts that allow them to wiggle out of correcting defects in homes, said sponsors and supporters of the bill at a news conference Thursday.
"Once they (buyers) sign the contract, it keeps them from using the process to address deficiencies," said Rep. Jack Pommer, D-Boulder, who is sponsoring the new bill with Sen. Jennifer Veiga, D-Denver.
Pommer said that what often happens is that builders use the clauses to avoid making legitimate repairs. The owner can't afford to fix the problems or sue the builder, and the home can't be sold because of the defects.
Some clauses require homeowners to waive all negligence claims; allow builders to buy back the home at the purchase price, if owners pursue construction default claims; and prevent owners from hiring experts, said Clay Vigoda, who supports the new legislation. In 2004, Vigoda lobbied for Amendment 34, which would have overturned HB 1161.
"It creates an untenable situation," Pommer said of the clauses.
Pommer said lawyers for home builders have told him privately that the clauses are "unconscionable" and would likely be tossed out by an appellate court, although he said lower courts have upheld them.
Pat Hamill, principal of Oakwood Homes, said he doesn't think the majority of builders are flouting HB 1161.
"I think most builders go far beyond what the law requires," Hamill said. "You won't survive in business in the 21st century if you don't. There are a few in my industry who don't, and they deserve the consequences."
At Oakwood, for example, there's a weekly meeting on the status of warranty work, which Hamill said is carefully tracked. rebchookj@RockyMountainNews.com or 303-954-5207
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