Colorado’s construction industry last had major changes to the defects litigation landscape in 2017 when a legislative bill and a state Supreme Court decision gave some protection to industry players. A new bill benefitting property owners that passed out of the Senate Judiciary committee last Wednesday has the construction industry nervous about exposure to litigation over defects.
Senate Bill 138 extends the time after a project is finished during which a property owner can have a claim — called a statute of repose — from six to 10 years. It also changes when the separate statute of limitations to file a claim starts running. Currently, a property owner has two years from when they discover a problem.
The bill changes that trigger to start the two years from when a property owner discovers the source of the
problem — in other words, knows it’s due to a construction defect and not normal wear and tear on the property. Senate Bill 138 also clarifies both the statute of repose and statute of limitations are subject to statutory and equitable tolling
Property owners who testified to support the bill shared tales of dis- covering problems with their homes where builders had used Band-Aid repairs to lead them to believe the problem was fixed until the statute of limitations for filing a defect claim ran out. Sponsor Sen. Robert Rodriguez told the committee he believes actors in the construction industry overall have good intentions to build reliable projects. He said as the owner of an aging home built in the 1940s, he understands problems that come up aren’t always because of a faulty build.
“The problem is there are bad actors that make the construction industry look bad, and what I’m trying to do is find solutions for that,” he said. After the hearing, he told Law Week he wants Senate Bill 138 to protect average homeowners who don’t have sophisticated knowledge about their rights under construction defects law.