Homeowners want speedy resolutions to their repair problems

Kiley Russell

Thursday, March 25, 1999 | 5:12 a.m.

CARSON CITY -- Homeowners and builders argued Thursday over a bill to help people who buy shoddy houses get repairs without having to drag their contractors into court.

Advocates of AB442 told the Assembly Judiciary Committee about leaking roofs, cracked walls, substandard electrical wiring, water damage and even toxic mold in new homes. They said the bill would speed up negotiations between owners and builders and avert costly court battles.

"We're just trying to make these places the way they should have been built," said Bill Robinson, president of the Rancho Santa Fe Home Owners Association in southern Nevada.

The company that build Rancho Santa Fe's homes dissolved shortly after the last house was sold, Robinson said.

"We're dealing with a builder who said 'I built these things and if you're dumb enough to buy them from me, then you're dumb enough to live in them."'

The bill would close loopholes in the existing law and force builders into mediation prior to litigation, said representatives of the Nevada Trial Lawyers Association.

In addition, AB442 would force contractors to make serious offers to either repair or pay for whatever construction defects the homeowners say they can prove.

"This bill requires contractors to make an offer in good faith," said Scott Canepa of the NTLA.

Contractors can abuse the existing system by making ridiculous offers that are unacceptable to homeowners, thereby undermining the whole purpose of mediation and forcing both parties into court, he added.

"We've had situations where the contractor looks at the situation and says 'We know the problem is a $100,000 defect problem, but we're going to offer $10,"' Canepa said.

Under AB442, failure to negotiate in good faith could be used by the homeowner as evidence in seeking a larger award from a jury.

While no vote was taken, the measure was backed by Judiciary Chairman Bernie Anderson, D-Sparks - despite an argument from the bill's opponents that it would do the opposite of what the NTLA says.

"It simply accelerates the opportunity to begin litigation," said Jim Wadhams of the Southern Nevada Home Builders Association.

The bill says that if a builder hasn't responded to a homeowner's complaint within 45 days, then the homeowner could skip mediation and go right to court. Currently, owners and builders must go into mediation regardless of how long that process takes.

"The problem arises when there are multiple units - the clock is ticking and you have to find the defects in this big structure," Wadhams said, adding that there is no provision to force owners to reveal where the problems are.

Assemblyman John Carpenter, R-Elko, asked if the bill would effectively eliminate the mediation process altogether.

"No, not at all. We want the mediation process. It only takes it out of the system if the builder refuses to cooperate. We can say 'He won't even play the game, let's go on with our lawsuit,"' said NTLA president Bill Maddox.

But Wadhams said the bill is dangerous to builders because it also allows owners to sue for damages beyond the cost of repairing defects - which they currently can't do.

"When you have a problem with you motorhome, your TV set, your Sony Walkman or your house, you take it back to whoever made it and you say 'Fix it or replace it.' You give that manufacturer, seller or dealer the opportunity to make it right," Wadhams said.

Damages for pain and suffering would be just as inappropriate in a case about a defective home as it would in a case about a defective TV set, he added.