A recent story from a television station in New Mexico (“Excessive litigation a threat to home construction” read more here) so understates the matters at issue with respect to construction defects with residential homes. First, construction defects with new residential construction are inevitable and are most certainly expensive for anyone involved to litigate to a conclusion. However, given that most builders turn understandably to their insurance carriers to take care of issues that arise with homes that they build, the issue, for the most part, is not “litigious” homeowners or lawyers. Time and again, insurance companies for builders and building product manufacturers simply turn a blind eye to issues and force homeowners (and builders) to litigate claims that can and should be resolved.
However, without homeowners’ ability to litigate claims under rules of discovery that permit them to uncover building product manufacturers and the construction industry’s knowledge of common construction defects and building practices, even on a class-wide basis, many construction defects with residential homes would go unresolved (creating economic uncertainty in a real estate market that at any given moment can be rendered more uncertain through “market” forces). Without the ability to use discovery to undercover these issues, insurance companies will not appreciate the risk that comes with litigating these claims to a conclusion. Both homeowners and the building community fall victim to the litigation strategy of insurance companies, and fortunately, when the process of discovery is completed, most every construction defect case is settled, precisely how the process is supposed to work.
If someone could show me a process, other than litigation, designed to get to the “truth” and with the transparency associated therewith, I would be all for it. Forced arbitration isn’t it. Given that taxpayers in the United States fund (as they should) a judicial process that resolves millions of matters per year, both in our criminal and civil courts, that aren’t as significant, at least to most homeowners, as the integrity of the largest single investment that they may make in their life (their home), I’ll continue to opt (hopefully as a last resort) for the court system in the United States to resolve claims when that is the process necessary to force accountability.
Litigation and new home construction requires expert, seasoned legal advice. For over 40 years, Shipman & Wright has been litigating construction cases in southeastern North Carolina. If we can help you, please contact us today.