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New Case Knocks out Developer's Attempt to Mandate Steps to be Taken Before Filing A Construction Defect Lawsuit

A recent California Court of Appeal decision has provided some insight into the ability of Developer's to mandate prelitigation procedures with respect to the right to repair construction defects before filing a lawsuit.  The California legislature enacted the Right To Repair Act in 2002, commonly known as SB 800.  The Act sets forth a series of specific procedures that are required before a homeowner can institute litigation against a residential developer.  The act sets forth a procedure that allows a developer the opportunity to offer repairs  to the homeowner with respect to defective design and construction in an effort to avoid litigation.  The recent case of Anders v. Superior Court (Meritage Homes) involved a situtation whereby the developer included a procedure in the  purchase contract signed by the home buyers that required the homebuyer to go through a number of steps, some different that those set forth by statute, before a lawsuit could be filed.  A nice write up about this case is outlined in the blog of mediator Ron White (http://www.resolvingconstructiondisputes.com/2011/02/articles/litigation-1/a-new-construction-defect-case-to-sink-your-teeth-into/). 

     In my view, the Anders case essentially holds that alternative contractual procedures contained in purchase contracts are not enforcable, and that a builder who attempts to enforce these procedures may actually allow homeowners an easier path to avoid the prelitigation steps set forth by California law.  The Court found the procedures set forth in the Anders case to be "unconscionable."  Coupled with the recent decision of Villa Vincenza v. Nobel Court Development, which held that mandatory arbitration procedures in Association CC&R's to be invalid with respect to construction defect claims, the California consumer has been provided some good news from the Judiciary.

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