For homebuilders, minimizing risk on a construction job is essential, and long-term. Technology can help with risk management, quality assurance, project-document storage and archiving, customer-service management, insurance-certificate management, and post-warranty claims support.

This is essential in the state of California, especially as the industry awaits further clarification as to the effects of the December 18 California Supreme Court motion denial regarding Brookfield’s appeal of the Fourth Circuit ruling in Liberty v. Brookfield Homes. AxisPointe, www.axispointe.com, West Orange, N.J., CEO Stan Luhr says the new appellate decision will enable new causes of action for damages and allow plaintiffs to circumvent the 10-year old established right-to-repair provisions. These provisions included limitations to four years for plumbing, electrical, and other components.

According to the National Assn. of Subrogation Professionals, www.subrogation.org, Pittsburgh, Pa., Website, “This is a huge blow to the homebuilders industry, which fought fiercely to persuade the act applied to subrogating carriers.”

The results, in terms of construction defect claims? AxisPointe’s CEO Stan Luhr, who has practiced forensic consulting in California for 30 years, says there will be definite change, especially in terms of delays. “I spoke with a few attorneys who received notices from plaintiff’s counsel that they will be filing amended complaints immediately,” says Luhr. “We don’t know how this will affect current cases but it will definitely add to the delays in getting consumer complaints resolved quickly.”

As a result, Luhr suggests that California builders step up their customer service and post-warranty claims processes—with a detailed quick response process for any claim involving water intrusion or actual damage to a home. Construction technology can play a big role in helping homebuilders manage claims. AxisPointe, for example, provides builders with several risk prevention tools that are particularly suited for California builders, who are required by state law to provide buyers with written maintenance manuals and information on energy components.

Also, earlier this month, AxisPointe released InSite DataQuery software, which allows builders to analyze construction activities and monitor quality, safety, and business processes from any device.

Luhr says the new scenario may include these new factors:

  • Homeowner claims for property damage made long after the four-year legislative statute has expired on issues such as plumbing and electrical systems, effectively opening the door for up to 10 years on such damage claims.
  • Plaintiffs ability to circumvent the SB 800 Right to Repair process altogether, on basis that property damage claims do not fall within the confines of the alternative resolution process.
  • New look at definition of “damage.”
  • Increase of subrogation claims against homebuilders by homeowner’s insurance companies that traditionally foot the bill for water leakage and damage claims.

For the full text of the Liberty v. Brookfield decision, go to the California Courts Website http://www.courts.ca.gov/opinions-slip.htm and search on Liberty v. Brookfield Homes.