{"id":883988,"date":"2015-10-07T11:18:35","date_gmt":"2015-10-07T17:18:35","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=883988"},"modified":"2015-10-07T11:18:35","modified_gmt":"2015-10-07T17:18:35","slug":"the-right-to-repair-act-isnt-out-for-the-count-yet-homebuilders-fight-back","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/the-right-to-repair-act-isnt-out-for-the-count-yet-homebuilders-fight-back\/","title":{"rendered":"The Right to Repair Act Isn\u2019t Out for the Count, Yet. Homebuilders Fight Back"},"content":{"rendered":"<p>Garret Murai | California Construction Law Blog | September 30, 2015<\/p>\n<h2>The Little Case That Roared<\/h2>\n<p>Two years ago we wrote about a case that caused an\u00a0<a href=\"http:\/\/calconstructionlawblog.com\/2013\/09\/09\/theres-more-than-one-way-to-skin-a-cat-when-there-are-actual-damages-under-sb-800\/\">uproar in the\u00a0homebuilding industry<\/a> \u00a0\u2013\u00a0\u00a0<a title=\"Liberty Mutual Insurance Company v. Brookfield Crystal Cove LLC\" href=\"http:\/\/scholar.google.com\/scholar_case?case=1053735174686685481&amp;q=Liberty+Mutual+v.+Brookfield&amp;hl=en&amp;as_sdt=4,5\" target=\"_blank\"><em>Liberty Mutual Insurance Company v. Brookfield Crystal Cove LLC<\/em><\/a>, 219 Cal.App.4th 98 (2013) \u2013\u00a0in which the California Court of Appeals for the Fourth District held for the first time that the Right to Repair Act does not provide the exclusive remedy for construction defect claims involving \u201cactual,\u201d as opposed to \u201ceconomic,\u201d damages in new residential housing.<\/p>\n<p>It was a blow to the homebuilding industry who back in 2002,\u00a0following a wave of construction defect lawsuits involving new residential housing,\u00a0lobbied the State Legislature for the Right to Repair Act which gave homebuilders\u00a0an opportunity to repair defects before being sued in court.<\/p>\n<p>Shortly after\u00a0<em>Brookfield <\/em>was decided,\u00a0the California Court of Appeals for the Second District,\u00a0in <em>Burch v. Superior Court<\/em>, Case No. B248830 (February 19, 2014), dealt another devastating blow to homebuilders and held that homeowners (in addition to insurers brining subrogation claims as in <em>Brookfield<\/em>) could pursue negligence and breach of implied warranty claims against homebuilders involving actual damages.<\/p>\n<p>Just two days after <em>Burch<\/em> was decided, the California Court of Appeals for the Second District, \u00a0in\u00a0<em>KB Home Greater Los Angeles, Inc. v. Superior Court<\/em>, Case no. B246769 (February 21, 2014), dealt what appeared to be the final blow to homebuilders and in a case unique to its facts, held that an insurer <em>did<\/em> have to comply with the prelitigation notice and opportunity to cure provisions of the Right to Repair Act, <em>but only<\/em> because its common law claims were dismissed before<em>Brookfield<\/em> was decided.<\/p>\n<p>It appeared to be the end. The homebuilders were down for the count. One, two, three, four, five . . .<\/p>\n<h2>And Then a Miracle\u00a0Happened<\/h2>\n<p>Over a year and half after the <em>Brookfield<\/em>, <em>Burch<\/em> and <em>KB Home <\/em>decisions, the California Court of Appeals for the Fifth District, in <em><a href=\"https:\/\/scholar.google.com\/scholar_case?case=17791007674852139034&amp;q=McMillin+Albany&amp;hl=en&amp;as_sdt=4,5&amp;as_ylo=2015\" target=\"_blank\">McMillin Albany LLC v. Superior Court<\/a><\/em>, Case No. F069370 (August 26, 2015), held that the Right to Repair Act does in fact provide the exclusive remedy for construction defect claims involving new residential construction, whether the damages alleged are actual or economic damages, and in doing so expressly rejected the \u201creasoning and outcome\u201d of the<em>Brookfield<\/em>\u00a0decision.<\/p>\n<p>In <em>McMillin<\/em>, thirty-seven homeowners sued the builder of the homes, McMillin Albany LLC (\u201cMcMillin\u201d), alleging that the homes were defective at the time of purchase and that the defects had caused actual damage to the homes. The homeowners alleged eight causes of action against McMillin including strict products liability, negligence, breach of express and implied warranties, and a claim under the Right to Repair Act.<\/p>\n<p>However, under the Right to Repair Act, homeowners are required to give notice to a homebuilder of alleged defects before filing suit and the homeowners in<em>McMillin<\/em>\u00a0had failed to do so. When McMillin threatened to file a motion to stay the action pending compliance by the homeowners of the pre litigation requirements of the\u00a0Right to Repair Act, the homeowners dismissed their claim under the Right to Repair Act and argued that by doing so they were not required to engage in the prelitigation process.\u00a0The trial court agreed and McMillin appealed.<\/p>\n<p>On appeal, the Court of Appeals, focusing on three sections of the Right to Repair Act \u2013 Civil Code section 896, 897 and 943 \u2013 held:<\/p>\n<ol>\n<li>Section 896 of \u201cthe [Right to Repair] Act applies broadly to \u2018<em>any<\/em> action seeking recovery of damages arising out of, or related to deficiencies in, the residential construction.\u201d And, thus, \u201c[b]y its plain language, the [Right to Repair] Act applies to\u00a0<em>any<\/em> action for damages related to construction deficiencies, and limits a claimant\u2019s claims or causes of action to claims of violation of the statutory standards.\u201d (emphasis in original);<\/li>\n<li>\u201cSection 897 provides: \u2018[t]he standards set forth in this chapter are intended to address every function or component of a structure. . . .\u2019 Thus, the Legislature intended to create a comprehensive set of construction standards to make the violation of any of those standards actionable under the [Right to Repair] Act.\u201d; \u00a0and<\/li>\n<li>\u201c[S]ection 943 provides: \u2018Except as provided in this title, no other cause of action for a claim covered by this title or for damages recoverable under Section 944 is allowed.\u2019<\/li>\n<\/ol>\n<p><a href=\"http:\/\/calconstructionlawblog.com\/2015\/09\/30\/the-right-to-repair-act-isnt-out-for-the-count-yet-homebuilders-fight-back\/\">To read the rest of this article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Garret Murai | California Construction Law Blog | September 30, 2015 The Little Case That Roared Two years ago we wrote about a case that caused an\u00a0uproar in the\u00a0homebuilding industry \u00a0\u2013\u00a0\u00a0Liberty Mutual Insurance Company v. Brookfield Crystal Cove LLC, 219 Cal.App.4th 98 (2013) \u2013\u00a0in which the California Court of Appeals for the Fourth District held&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/the-right-to-repair-act-isnt-out-for-the-count-yet-homebuilders-fight-back\/\">Continue reading <span class=\"screen-reader-text\">The Right to Repair Act Isn\u2019t Out for the Count, Yet. Homebuilders Fight Back<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[14,4],"tags":[12,19,484],"class_list":["post-883988","post","type-post","status-publish","format-standard","hentry","category-construction-2","category-construction-defects","tag-construction","tag-construction-defects-2","tag-right-to-repair","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The Right to Repair Act Isn\u2019t Out for the Count, Yet. 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