Friday, March 30, 2007

Caveat homeowner: Lawmakers support fair balance in home transactions

Clint Talbott, for the editorial board
Friday, March 30, 2007

Four years ago, the home-building industry bought some income protection from the state Legislature. This year, lawmakers are trying to nudge the scales back toward a balance between seller and buyer.

Not surprisingly, home builders are displeased. But the industry's financial interests are no longer the Legislature's driving concern.

In 2003, the state Legislature approved a law limiting the ability of home buyers to sue for negligent construction, and sharply limiting the damages the buyers could collect. Under that law — which the home-building interests spent $355,000 lobbying for — home buyers were required to try to cajole home builders into fixing shoddy construction before filing suit.

Apparently to some home builders, those barriers to consumer protection weren't high enough. Rep. Jack Pommer, a Boulder Democrat, says major home builders have been including warranty escape clauses, leaving some home buyers with little or no recourse for faulty construction.

A press release issued Wednesday by state Democrats contrasted home builders' promises in 2003 with their actions in 2007. "With this (2003) law, builders still end up being responsible to fix a problem, and good builders will always do that," Amber Homes President Jim Harmon told Colorado Builder magazine then.

Today, the Dems note, Amber Homes contracts include this clause: "To the fullest extent permitted by law, all other warranties, expressed or implied, including warranties of merchantability, fitness for a particular purpose, workmanship and habitability are disclaimed, excluded and waived."

That inconsistency explains the genesis of House Bill 1138, which is sponsored by Pommer and which cleared the state House on Thursday. The bill would, rather modestly, prevent home buyers from being forced to forfeit their right to seek redress for faulty construction.

On Wednesday, Harmon of Amber Homes told the Rocky Mountain News that the central issue (fair warranties) was a ruse. He lambasted the trial lawyers, who he said are behind HB 1138 and are tilting against a "problem that doesn't exist."

If there's no problem, why are some home builders unwilling to warranty their work on basic measures of quality — such as "habitability"?

Rep. Debbie Stafford, an Aurora Republican, was among those supporting the Pommer bill. She did so even though, she alleges, a fellow legislator warned her that she'd be targeted in future elections by the home-building barons.

As Pommer explained this week, HB 1138 is neither anti-builder nor anti-business. "This gives homeowners a fighting chance if they find out that their new home has serious problems," Pommer said. "We're leaving in place the limits on liability that the home builders say they need, but restoring the legal rights homeowners need to protect the huge investment they make in their house."

No "good builder" would object to that. For most people, the purchase of a home is the most significant investment in life. Buyers deserve more than a contractually enshrined caveat emptor.

Clint Talbott, for the editorial board


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