{"id":895332,"date":"2018-12-20T14:39:10","date_gmt":"2018-12-20T21:39:10","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=895332"},"modified":"2018-12-20T14:39:10","modified_gmt":"2018-12-20T21:39:10","slug":"class-actions-californias-right-repair-act-nope-well-nope","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/class-actions-californias-right-repair-act-nope-well-nope\/","title":{"rendered":"Class Actions Under California\u2019s Right to Repair Act. Nope. Well . . . Nope."},"content":{"rendered":"

Garret Murai | California Construction Law Blog<\/a> | December 17, 2018<\/p>\n

It\u2019s the holidays. A time when family and friends, and even neighbors, gather together.<\/p>\n

And nothing brings neighbors closer together than class action residential construction defect litigation.<\/p>\n

In\u00a0Kohler Co. v. Superior Court<\/em>, Case No. B288935 (November 14, 2018),\u00a0the Second District Court of Appeal addressed whether neighbors can bring class action lawsuits under the Right to Repair Act. For those who are regular readers of the California Construction Law Blog you\u2019re familiar with the Right to Repair Act codified at Civil Code sections 895\u00a0et seq<\/em>.<\/p>\n

For those of you who aren\u2019t here\u2019s a short history. In 1998, in\u00a0Aas v. Superior Court<\/em>\u00a0(1998) 64 Cal.4th 916, the California Supreme Court held that\u00a0economic damages<\/em>\u00a0arising from construction defects, say a defective roof (as opposed to damage to your holiday gifts as a result of water damage resulting from the defective roof), are not recoverable if the basis for liability is negligence (e.g.<\/em>, faulty workmanship) or strict liability (e.g.<\/em>, defective materials).<\/p>\n

To limit the application of the\u00a0Aas<\/em>\u00a0case to newly constructed residential housing, including single family homes and condominiums (but not condominium conversions), the California legislature enacted SB 800 also known as the Right to Repair Act. The Right to Repair Act permits homeowners of newly constructed residential housing to sue for economic damages alone if new residential construction does not meet certain enumerated construction standards set forth under the Right to Repair Act and the homeowner satisfies the pre-litigation procedures of the Act.<\/p>\n

One aspect the Right to Repair Act does not clearly address, however, is if homeowners can join together and bring a class action lawsuit under the statute.<\/p>\n

Kohler Co. v. Superior Court<\/strong><\/h2>\n

In\u00a0Kohler<\/em>, two homeowners, Joanna Park-Kim and Maria Cecilia Ramos, filed a lawsuit against Kohler Co. on behalf of themselves and others similarly situated \u00a0throughout California. The plaintiffs alleged that \u201cRite-Temp Pressure Balancing Valves\u201d and \u201cMixer Caps\u201d manufactured by Kohler, which are used to regulate water flow and temperature in household plumbing, were \u201ccorroding, failing, and\/or will inevitably fail\u201d and violated the construction standards of the Right to Repair Act. \u00a0Kohler sold approximately 630,000 of these valves and mixer caps in California during the relevant period.<\/p>\n

While the case was pending, Kohler filed a motion claiming that the Plaintiffs could not bring a class action lawsuit under the Right to Repair Act. The trial court denied Kohler\u2019s motion but certified its ruling for appellate review finding that the issue presented a controlling question\u00a0of law upon which there were substantial grounds for differences of opinion.<\/p>\n

The Appellate Court Decision<\/strong><\/h2>\n

On appeal, the Second District Court of Appeal focused on Section 931 of the Right to Repair Act, which provides that, when construction defect claims combine causes of action or damages that are\u00a0not<\/em>\u00a0covered under the Right to Repair Act (i.e.<\/em>, construction defects that are not among enumerated construction standards of the Act) with other claims involving construction defects that\u00a0are<\/em>\u00a0covered by the Act, that those defects that are covered by the Act are to be administered according to the Act (i.e.<\/em>, the pre-litigation procedures of the Act). Specifically, Section 931 provides:<\/p>\n

If a claim combines causes of action or damages not covered by this part, including, without limitation, personal injuries,\u00a0class actions<\/em>, other statutory remedies, or fraud-based claims, the claimed unmet standards shall be administered according to this part, although evidence of the property in its unrepaired condition may be introduced to support the respective elements of any such cause of action. As to any fraud-based claim, if the fact that the property has been repaired under this chapter is deemed admissible, the trier of fact shall be informed that the repair was not voluntarily accepted by the homeowner.\u00a0As to any class action claims that address solely the incorporation of a defective component into a residence, the named and unnamed class members need not comply with this chapter<\/em>.<\/p><\/blockquote>\n

Describing Section 931 as \u201csomewhat obtuse,\u201d the court noted that while the inclusion of the term \u201cclass actions\u201d in the first sentence implies that class actions\u00a0cannot<\/em>\u00a0be brought under the Right to Repair Act, the last sentence of the section that \u201cany class action claims that address solely the incorporation of a defective competent into a residence\u201d suggests that\u00a0certain<\/em>\u00a0class actions might be able to be brought under the Act.<\/p>\n

Looking to the legislative history of the Right to Repair Act, the Court of Appeals held that class actions may not be brought under the Right to the Repair Act, \u201cwith one very narrow exception.\u201d<\/p>\n

The Court of Appeal referred to a Senate bill analysis of SB 800 discussing the pre-litigation procedures of the Right to Repair Act, which stated: \u201cThe bill establishes a mandatory process prior to the filing of a construction defect action. The major component of this process is the builder\u2019s absolute right to attempt a repair prior to a homeowner filing an action in court. Builders, insurers and other business groups are hopeful that this right to repair will reduce litigation.\u201d The Court concluded that \u201cit makes sense\u201d that \u201cthe Legislature intended to exclude class actions for virtually any claim under the Act, because class actions make prelitigation resolution impossible.\u201d Moreover, held the Court:<\/p>\n

Even if the named plaintiffs bringing a class action comply with the prelitigation process, thus giving the builder of their homes an opportunity to attempt to repair whatever defect is claimed as to their homes, the builders of other homes are given no such opportunity with respect to the unnamed class members, thus thwarting one of the most significant aspects\u00a0of the Act.<\/p><\/blockquote>\n

However, held the Court of Appeal, Section 931 does carve out one narrow, or, as the Court stated, one \u201cvery<\/em>\u00a0narrow\u201d exception to the Right Repair Act. \u00a0And that is claims that solely involve the incorporation of a defective component into a home.<\/p>\n

And, here, because the plaintiffs\u2019 claims against Kohler alleged that the defective valves and mixers violated several of the enumerated construction standards set forth under the Right to Repair Act causing damage to other components in their homes, the Court of Appeal held that their claims did not solely involve incorporation of a defective component in their homes, and further, involved an allegedly defective manufactured product that is excluded under Section 896 of the Right to Repair Act, which excludes \u201cany action seeking recovery solely for a defect in a manufactured product located within or adjacent to a structure.\u201d<\/p>\n

\u201cIn short,\u201d held the Court of Appeal, the Right to Repair Act \u201cdoes not permit class action claims except when those claims address solely the incorporation into the home of a defective component other than a product that is completely manufactured offsite.\u201d<\/p>\n

So there you go. Something for everyone this holiday season. Kind of.<\/p>\n

Conclusion<\/h2>\n

Kohler Co.<\/em>\u00a0clarifies that, with one very narrow exception, class action lawsuits cannot be brought under the Right to Repair Act. Furthermore, while the Court did not directly address what constitutes a \u201cdefective component other than a product that is completely manufactured offsite,\u201d it would seem that this is indeed, as the Court of Appeal stated, a very narrow exception that would exclude class action claims involving most \u00a0manufactured products except products built in whole or in part at a project. Maybe I\u2019ve had too much eggnog, but I can\u2019t even imagine what those types of products might be.<\/p>\n","protected":false},"excerpt":{"rendered":"

Garret Murai | California Construction Law Blog | December 17, 2018 It\u2019s the holidays. A time when family and friends, and even neighbors, gather together. And nothing brings neighbors closer together than class action residential construction defect litigation. In\u00a0Kohler Co. v. Superior Court, Case No. B288935 (November 14, 2018),\u00a0the Second District Court of Appeal addressed… Continue reading Class Actions Under California\u2019s Right to Repair Act. Nope. Well . . . Nope.<\/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":[4],"tags":[9895,88,8789,434],"class_list":["post-895332","post","type-post","status-publish","format-standard","hentry","category-construction-defects","tag-advise-consult","tag-california","tag-class-action","tag-right-to-repair-act","entry"],"jetpack_publicize_connections":[],"yoast_head":"\nClass Actions Under California\u2019s Right to Repair Act. 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