Contruction Today - July/August 2017 - 38

Residential

By Blair Lichtenfels and Jonathan Pray

Lowering
Defect Lawsuit Risks

M

ultifamily housing construction has been booming across
the country, evidence of what
has been dubbed the "backto-downtown movement." Much of the
construction has been at the top end of the
residential market, particularly in the luxury
apartment sector. Despite this, in pockets of
the country, condominium construction is at
near all-time lows, in part due to legal frameworks that make it easy for HOAs to bring
expensive construction defect suits against
developers and contractors. Developers and
contractors are natural (and sometimes

38

CONSTRUCTION-TODAY.COM JULY/AUGUST 2017

easy) targets for HOA boards, who all too often view a construction
defect lawsuit as a no-lose proposition. Once filed, construction
defect lawsuits can last years, and the costs of defending them can be
staggering - and in the meantime unit owners are frequently unable
to sell their units.
Some state and local governments are trying to pass measures
intended to reduce these risks. By way of example, Colorado recently
enacted legislation requiring HOAs to go through stricter processes
and follow tougher voting requirements before bringing construction
defect claims against developers, contractors and designers. This measure (and similar legislation around the country) is a step in the right
direction, but certainly not a panacea. The current state of uncertainty
means that contractors and developers often need to find their own
tools to mitigate the risks associated with condo projects.


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Table of Contents for the Digital Edition of Contruction Today - July/August 2017

Contents
Contruction Today - July/August 2017 - Cover1
Contruction Today - July/August 2017 - Cover2
Contruction Today - July/August 2017 - 1
Contruction Today - July/August 2017 - Contents
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