If you repeat a lie often enough, it becomes the truth. So goes the issue of "construction defect litigation" in California. Critics of the justice system say too many homeowners are racing to the courthouse to file frivolous lawsuits over things like loose shower heads, thereby driving up the insurance rates and plunging resale values.
Beyond the smoke and mirrors, the reality is quite different. In most cases, homeowners use lawsuits as a last resort when faced with a builder who will not repair a poorly built home. Many construction defect lawsuits are filed after years of informal negotiations to resolve the problem. Most of the homeowners have never sued anyone and many of them initially approach the builder (not a lawyer). Bottom line: they simply want their homes fixed and repaired so they can get on with their lives.
California and other states have long recognized strict liability for home-building defects. The aim is to protect buyers, many of whom may be buying real property for the first time. Typically, these buyers do not have the expertise of builders or architects to find or recognize problems and do not have the bargaining power to negotiate for their protection.
Just as a driver relies on Ford or GM to make a safe and sound vehicle, homeowners rely on a builder to similarly construct their home. This is important because many home buying decisions are based on an attractive model or a picture in a brochure the new home usually has not been built yet. Just as the driver would complain, and even sue, if the brakes did not work, the homeowner should have the right to complain and sue, if necessary, about defects in homes. For their part, both the car manufacturer and builder can prove, if the facts justify it, that the owner created the problem. The law is fair and square on this last point.
Construction defect issues are not always readily apparent. They may be "patent" those obvious by reasonable inspection or they may be "latent," which are not so apparent and may not show up for several years. Not all defects are discovered in inspections by public agencies many are not. For this reason, public agencies are immune from liability for having missed a defect or even negligently conducting an inspection. Ideally, the public agencies responsibility for inspections would uncover every defect. In the real world that does not happen, nor is it probably even possible.
How are defects defined? The law on this point is based primarily on common sense. Defects generally must be failures which an ordinary owner would not expect when used in normal circumstances. In other words, the owner does not expect his windows to leak after every rain, but it may not be defective if the owner fails to maintain the windows properly and on a regular basis.
While some defects may be minor, others can be devastating and even life-threatening. For example, inadequate "shear" (protection against wind and seismic events) could prove dangerous in a home. That is what we found in a case that involved a $4.4 million jury verdict, one of the largest ever involving a homeowner's suit against a developer in Sacramento County for 30 families in the Lexington Hills subdivision in Folsom. Recently, a second case in the same subdivision and the same basic allegations led to a $3.5 million out-of-court settlement for 41 homeowners. This case was successfully mediated and resolved before we were to go to trial.
Rather than simply abolishing construction defect litigation, it should be viewed as a last resort where each side can present its side of the story to the judge or jury, if all else fails. Not only homeowners, but builders as well, have expert witnesses and attorneys who can explain why cracked tile work is defective, whether poor maintenance instead of shoddy construction caused a problem and how much it really costs to repair such items.
Before reaching that stage, homeowners should give builders the opportunity to inspect and fix problems, and builders should take that opportunity even though the building passed all inspections. Sometimes, tightening loose shower heads is worth more in client satisfaction and public relations than establishing fault. If that approach does not work, there are various cost-effective settlement programs, such as mediation and arbitration.
Californians do not want to abolish the civil justice system, destroy the role of juries and judges, or leave homeowners helpless against malicious or inept builders. While critics distort statistics and anecdotes about litigation issues, the fact remains that people do not want their rights under the law taken away. Do not mess with the common law system; it has taken hundreds of years to evolve, and it is wiser than us all.