Senate restores protections for homeowners in construction bill
Aspen Times Staff Writer
A bill proposed by state Rep. Greg Rippy that would have protected unscrupulous or incompetent builders from being sued by homeowners has been radically amended by the Colorado Senate.
The changes restore many of the standard legal protections homeowners currently have. The progress of House Bill 1161, sponsored by Rippy, the Glenwood Springs Republican who represents the entire Roaring Fork Valley, has been closely followed by contractors and homeowner groups alike because its passage would dramatically affect their legal rights.
The version that came out of the state House of Representatives at the end of January granted so-called “construction professionals” – contractors, subcontractors, architects, engineers and developers – broad protections against lawsuits from their customers.
Rippy was quoted in the local and statewide press as saying the bill was necessary to ensure that construction professionals could purchase business insurance at a reasonable cost.
The House version of the bill was aimed directly at reducing the liability builders face for the work they do. It required a disaffected homeowner to provide a list of defects, before taking the matter to court, to the construction professional allegedly responsible for the shoddy work. The professional could then tender an offer to settle the damages either with money or repairs.
If the homeowner was unsatisfied with the offer, Rippy’s bill required the homeowner to prove in court that the offer was, in fact, short of what was needed to make the repairs. If the homeowner could not prove that the settlement offer was short of what was needed, the homeowner would be required to live with that offer.
If the disaffected homeowner could then clear that hurdle, he would then be required to prove that the construction professional acted fraudulently “beyond a reasonable doubt,” meeting a criminal standard of proof in a civil action.
County Commissioner and lawyer Mick Ireland, a sharp critic of Rippy’s bill, said proof beyond a reasonable doubt is not required for any other civil action. Juries in civil suits, such as a dispute between a home buyer and home builder, are required to find on behalf of the plaintiff (homeowner) if the “preponderance of evidence” supports their claim.
Rippy’s bill also barred homeowners from suing for triple damages, as allowed by Colorado’s consumer protection laws. The threat of triple damages is meant to discourage businesses from ripping people off, because if they are caught and sued, they could be required to pay three times the amount of the actual damages.
By the time the state Senate was finished on Feb. 19 with Rippy’s bill, homeowners were again allowed to sue for triple damages, with a cap at $250,000. The Senate also removed both the requirement that a homeowner prove that the offer to cure the damage is inadequate, and the requirement that a construction professional be found guilty of fraud beyond a reasonable doubt before damages can be awarded.
The bill, as amended by the Senate, has been sent back to the House for further action. Rippy and his colleagues can choose among three courses of action, said Vickie Agler, the House speaker’s chief of staff.
The bill’s sponsors, Rippy along with fellow Republican house members Timothy Fritz, Bill Cadman and Al White, can accept the bill as amended. They can take no action and let it die. Or they can push the bill into a conference committee made up of House and Senate members to negotiate a compromise.
Rippy said at the end of last week he planned to meet with interested groups this week before deciding what to do.
“In all likelihood we’ll probably go into conference committee,” Rippy said.
[Allyn Harvey’s e-mail address is email@example.com]
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