Construction defect laws are in place to protect consumers, but there are many disagreements over how much time property owners have to lodge a complaint and what happens if the defects impact an entire area.
Lawmakers are aware of this and are taking steps to make changes. If a new bill becomes law, property owners would have increased shields in the event there are construction defects. Although these are not yet laws, companies should be aware of them as they try to improve and run their construction business.
The Construction Defect Reform Act would make substantive changes
If the bill becomes law, it would create a process where property owners could file a lawsuit against the construction company if they find problems with the project. It would focus on different entities when remedying the defect.
Under the bill, property owners will have more time – 10 years instead of six – to file a lawsuit based on construction defects. In addition, if homeowners are on the same street and have the same problems with their home, they can file a claim together regardless of whether there is a homeowner association.
Sponsors of the law want companies to adhere to the warranties provided when they work on a project. Colorado is known for its short amount of time for homeowners to file such a claim as it one of the shortest in the nation.
Those who are against the bill believe it will negatively impact how much construction is done in the state. Another concern is the prejudgment interest of 6% companies would be obligated to pay.
Increased scrutiny and a longer time in which lawsuits can be filed could force some construction companies and contractors to think twice about taking part in various projects. Proponents of the bill say it is addressing worries for both builders and property owners.
Construction defect law can be complicated
Companies that are alleged to have completed a project with defects need to be aware of the current and potential laws that could factor in with how they operate their business. Whether it is crafting a defense against construction defect claims, discussing a settlement or being prepared for new laws that may be on the horizon, it is imperative to be ready for every eventuality with help from those experienced in all areas of construction law.