Builders oppose Amendment 34
The Summit County Builders Association is strongly opposed to Amendment 34. If Amendment 34 should be passed, gone are the construction defects (tort) reforms provided in House Bill 1161 enacted in 2003. Amendment 34 applies universally and retroactive to all construction projects, including those led by homeowners (even after the home is sold) for construction defect litigation. Amendment 34 expands lawsuits to include anyone either directly or remotely involved with a construction project: contractors, homeowners, even Realtors.Amendment 34 allows for no-limits lawsuits. Furthermore, as a constitutional amendment, no laws can be enacted to place any parameters or boundaries governing the size and shape of construction defects lawsuits. This invites lawsuits to be filed exponentially.A good solution to costly construction defect litigation is already in place, and has been working very well since its enactment by the Colorado legislature in 2003. HB 1161 helps homeowners and builders to resolve their differences, in a timely manner, without resorting to expensive and time-consuming lawsuits. Under HB 1161, builders must be responsive to homeowners’ complaints about “actual” damages (not damages that might happen in the future), or they lose their protections under the legislation. If there is fraud on the part of the builder, then the builder loses the protections and limitations (such as the $250,000 cap on treble damages, which is a punitive or penalty award above and beyond the actual damages) provided for in HB 1161. The goal of HB 1161 is to make homeowners “whole,” to correct the construction defect, cover the homeowners expenses related to the defect, and/or reach a settlement that is fair to both parties.If homeowners are dissatisfied with the process, with the repairs or proposed settlement, they can still sue. Since HB 1161 went into effect, 94 percent of complaints have been settled to the satisfaction of the homeowner and the builder, without resorting to a lawsuit.Amendment 34 is not in the best interest of Coloradans. Not only will liability insurance rates continue to increase for builders, but homeowners’ insurance rates will also increase.When insurance rates soar, housing costs increase proportionately. In a market where it is already tough for a first-time homeowner to find their American Dream, it will no doubt become even tougher. And when you see builders go out of business, unemployment rates will certainly increase for the tradesmen and material suppliers affected. Amendment 34 singles out a very strong Colorado industry in our state Constitution, and the total economic effect to the state would be devastating.
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