Sept. 2005

Guest Column by
Nancy Seats, President
Homeowners Against Deficient Dwellings INC. (HADD INC)

Newly built home “consumer protection” in the United States
Canadians beware!

Purchasing a new home is the largest purchase most consumers make.  However, many do not realize what little consumer protection home owners have when purchasing a newly built home.

Thirteen years ago when I was dealing with my own construction defect case, I thought that if I just let my elected officials know about the need for consumer protection for homebuyers they would solve the problem. How naive I was! Thirteen years later and at least 26 trips to the state capitol to testify about the need, what did our elected officials do? They passed legislation in 2005 that makes it even more difficult for homeowners who have been HADD by their builder. The elected officials fell for the campaign contributions and lobbyists representing the home building industry line that homeowners are filing "frivolous" lawsuits against them without even giving them an opportunity to repair. This legislation has been passed in over half of the states, and research shows that builders are spending millions of dollars to accomplish this. It is too bad new home builders just don't spend those dollars on better construction practices so there would be no need for lawsuits! And it is interesting and important to note that the name of the Bill always has “consumer protection” in it.

At least one Canadian journalist, Bob Aaron, a lawyer who writes for the Toronto Star, seems to feel arbitration is far more desirable than court.  This may be true in Canada, but in the United States, we are fighting mandatory binding arbitration clauses -- especially those that name the arbitration service that must be used. The builders are repeat customers of these services and homeowners rarely are made whole.  In fact, we know of instances where the arbitrator actually ruled that the homeowner had to pay the bad builder, and these decisions can't be appealed. In this country most people who are forced to arbitration have to sign a secrecy agreement so that they can't warn the public about the builder or the harm caused them due to the arbitration clause, and very often arbitration actually is more expensive than going to court.

Recently a limited new home warranty was introduced in Texas.  Limited is the key word! One clause actually says that a homeowner must water their foundation to prevent concrete cracks. Of course, it is important then to document the date and time of watering (for several years) just in case, and to have a neighbor water the foundation when you are on vacation!

A poorly built home often leaves the homeowner devastated – financially, emotionally, and sometimes physically due to the health issues from mould and poor indoor air quality.  Let’s hope that Canada does not follow the lead of the United States in relation to its “consumer protection” for home owners of newly built homes!

Nancy Seats, President
Homeowners Against Deficient Dwellings INC. (HADD INC)
410 S Geyer Rd.
Kirkwood, MO 63122, USA
Member: National Alliance Against Construction Defects
A National Not for Profit Organization