Construction Defects Package Not All-Or-Nothing Proposition

One bill passes committee, but success seems uncertain for all.

The first of a batch of bills addressing Colorado’s construction defects laws passed its first test in the Senate last week.

The bill at the core of this year’s reform attempts, Senate Bill 45, passed the Senate Business, Labor and Technology Committee by a vote of 6-1. Although the bill is a key piece of this year’s battery of reform bills, it doesn’t signal success for the entirety of the reform package. The early success is for a bipartisan bill directly targeting insurance costs, but others focusing the claims process and alternative dispute resolution for construction defects claims have unclear futures. And regardless of legislative success for any of the bills, construction defects reform doesn’t automatically mean an end to the state’s shortage of multi-family home development.

Construction defects reform was considered a major issue at the start of this year’s legislative session for both political parties. Senate Bill 45 is the keystone in a set of bills, marking a different tactic from previous sessions, such as 2015 when legislators offered an all-in-one bill that addressed many issues.

Senate Bill 45, which received bipartisan sponsorship, is intended to bring balance to the insurance cost of a construction defects claim that involves more than one insurer by requiring the court to apportion the costs of defense, including attorney fees, among all insurers with a duty to defend.

To read this story and other complete articles featured in the February 13, 2017 print edition of Law Week Colorado, copies are available for purchase online.