Update on Notice Obligations Under Right to Repair Act


The Right to Repair Act or SB 800 (“Act”) provides for certain rights and procedures for homeowners and builders with respect to construction defect claims.  The Act requires certain pre-litigation notice and cure obligations between the parties before a suit may be filed by the homeowner.  A recent case entitled “Blanchette v. Superior Court” interpreted and clarified certain notice and time requirements of the Act (8 Cal.App.5th 521 (2017)).  In brief, the Act requires that, before initiating litigation, construction defect claimants must give the affected builder notice of an alleged defect and if the builder wishes, an opportunity to inspect and repair the noticed defects.  The claimant’s notice should set forth the defects “in reasonable detail” sufficient to determine the nature and location of the alleged defects.  After receiving the notice, a builder has 14 days in which to acknowledge receipt of the claim, and 14 additional days in which, if the builder wishes, to inspect the premises.  If an inspection is completed, a builder may thereafter make an offer to repair the claimed defects within 30 days.  The Blanchette case confirms that, as long as the homeowner’s notice includes general information to put the builder on notice of a construction defect claim covered by the Act, the 14-day clock for the builder to respond is triggered, even if the notice does not set forth the alleged defects “in reasonable detail”.

In Blanchette, Mr. Blanchette bought one of 28 homes constructed by GHA Enterprises, Inc. (“GHA”).  Mr. Blanchette served GHA with a notice setting forth a number of general construction defects in the 28 homes and a list of the affected homeowners, both required conditions of the homeowner’s notice under the Act.  However, his claim did not set forth the defects “in reasonable detail” sufficient to determine the nature and location of the alleged defects, also required by the Act.  GHA did not respond within the required 14 days and Mr. Blanchette asserted its response was untimely and excused him from any further obligations under the Act.  He thereafter filed suit against GHA for construction defect claims.  GHA moved to stay the litigation until Mr. Blanchette satisfied the pre-litigation requirements of the Act, specifically by providing a new notice to GHA which included the required “reasonable detail”.  The trial court agreed and held that Mr. Blanchette would need to serve a new notice of claims on GHA which (i) identified each individual claimant by address, (ii) provided a defect list for each subject property, (iii) listed the location, nature and severity of each alleged defect, and (iv) identified the code section(s) the claimants contend each alleged defect violates, as required by the Act.  Mr. Blanchette challenged the trial court’s order.

The Court of Appeal analyzed the issue under the framework of the Act’s intention to “promote resolution of a homeowner’s construction defect claim in an expeditious and non-adversarial manner”.  The Court found that Mr. Blanchette fulfilled the requirements of the Act in his original notice by listing the names of the owners of the affected homes and stating the general defects, even though he did not specifically meet the other condition of providing “reasonable detail” of the alleged defects.  The Court determined that the requirement of providing “reasonable detail” is subjective and could vary according to the factual situation.  However, they considered the Act’s requirement to respond within 14 days after receipt of claimant’s notice to be clear and not subject to interpretation.  As such, they held that the builder must respond to a homeowner’s notice within the 14-day period, even if it is to ask them to clarify their original notice and provide more specificity.  If the builder fails to do so, the homeowner can be excused from further pre-litigation procedures required under the Act and may directly proceed with litigation.  The Court theorized that allowing GHA to ignore the original notice in this case due to a lack of specificity would discourage the expeditious and non-adversarial resolution of claims.  By requiring a timely response from the builder, even if to lodge an objection with the homeowner for lack of specificity, the parties could resolve the issue in a more timely manner and before litigation is commenced.

The Blanchette case provides more clarity as to the pre-litigation notice procedures between a builder and homeowner under the Act.  It also highlights that it would be prudent for a builder to respond to each general claim of construction defect by a homeowner within 14 days, if only to ask for clarity from the homeowner or to object to its contents.  If that does not occur, a builder could waive its rights under the Right to Repair Act and a homeowner could properly bring an immediate suit for construction defects.

 

The issues discussed in this update are not intended to be legal advice and no attorney-client relationship is established with the recipient.  Readers should consult with legal counsel before relying on any of the information contained herein. Reuben, Junius & Rose, LLP is a full service real estate law firm.  We specialize in land use, development and entitlement law. We also provide a wide range of transactional services, including leasing, acquisitions and sales, formation of limited liability companies and other entities, lending/workout assistance, subdivision and condominium work.