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The Spokesman-Review Newspaper
Spokane, Washington  Est. May 19, 1883

Eye On Olympia

Builders v. Homeowners: new-home warranty battle continues at the capitol…

From the print paper this morning:

Shortly after moving into her new home three years ago, Karen Veldheer and her family noticed water leaking through the foundation.

Then another leak.

And another.

Those trickles and a host of other problems with the home launched Veldheer on a long and expensive trip through arbitration and court. She has won in both arenas – after racking up more than $20,000 in lawyer fees – but says the builder still won’t pay, apparently out of fear of setting a precedent for neighbors with similar complaints.

Lawmakers in Olympia are considering several proposals to make it easier for homeowners faced with major construction defects to take builders, subcontractors and suppliers to court. Homeowners have little protection, proponents say, in a system that often requires buyers to sign away many rights as a condition for getting the home.

“We have to look out for the consumers who are obligating themselves to 30-year mortgages,” said Rep. Brendan Williams, D-Olympia. The bills include HB 1045 and HB 1393.

Builders don’t object to some of the ideas, like stricter contractor licensing or having the state track complaints to see how bad the problem is. But they’re fighting hard against the idea of making it easier for homeowners to sue. That, they say, will spur lawsuits, drive up their insurance costs and hurt an already-struggling industry.

“Builders are not opposed to warranties,” said Damon Doyle, former president of the Building Industry Association of Washington. “Builders are opposed to broad, vague and involuntary mandatory warranties.”

There are numerous protections already, said BIAW general counsel Timothy Harris. “Existing law allows a number of ways for homeowners to sue,” he said.

And the percentage of contractors who’ve had claims filed against them, Doyle said, is less than 1.5 percent.

“All of the evidence available indicates that the problems are limited to an extremely small percentage of my colleagues,” Doyle told lawmakers. “… We can’t allow the risk of huge cost increases to further hamper an industry that is hanging by a thread.”

Rep. Dennis Flannigan, D-Tacoma, bristled at that.

“If lawyers only have 1 ½ percent of them that are crooks, we have laws about that,” he said. “People are pissed. I’m pissed. … I didn’t hear a single remedy from you about what the needs are for the people who can’t afford the lawyers you so cavalierly tell them to run to.”

The battle over better warranties is a long-running one in Olympia, with similar bills proposed since at least 1999. The state Senate has repeatedly voted for such changes, only to see them die in the House.

“Like a lifelong Cubs fan, my hope is mixed with a sense of abject futility,” Williams said.

Still, every year brings a new crop of aggrieved homeowners to the capitol, seeking help for new homes with flooding crawlspaces, dangerously sagging roofs or blanketed in mold from leaky siding.

“We are not going away. There’s some terrible problems in Washington,” said Redmond’s Carol DeCoeursey, citing a 35-page list of construction defects with her home.

Fly-by-night contractors know they can do shoddy work, then dissolve their company as complaints roll in and simply start a new one, homeowner Paula Cline said.

That is what happened to Bellevue homeowner Jan Fuitag Koontz. Cracks in drywall hid major structural problems, she said. While they were trying to get the builder to fix the problem, she said, the company simply dissolved.

“There was nothing to go after,” she said.

“We aren’t isolated events,” Cline said. “We are hardworking people who paid for a product.”

Typical home sales agreements, often touted as a warranty, include waivers of all legal rights, said attorney Sandy Levy. Even if building codes were violated or construction materials left out, he said, “there’s no remedy.”

Harris said the builders have no problem with more consumer education, such as listing in bold face a homeowner’s rights under the contract.

“I’ve never known anybody forced to sign any sort of contract, unless of course you’re dealing with the mafia,” Doyle said.

Rep. Larry Springer, D-Kirkland, is also calling for a state study to determine how much training to require before the state certifies that a worker is qualified. Ultimately, he said, the state could require individual certification for everyone swinging a hammer on a roof, for example.

Short takes and breaking news from the Washington Legislature and the state capital.