AIA Contracts with a California Twist
SB 800: The Right to Fix It Legislation
By Jan A. Gruen
This is the second in a series of articles that focus on certain pitfalls associated with the wholesale use of standardized AIA contracts. For those of you having trouble sleeping or those of you who design or build residential housing in California, the time has come to examine your AIA contracts.
START SIMPLY
Identify each provision in your standard contract that addresses SB 800. If you missed them the first time, try reading your contract again. Not there? Not surprising.
AIA contracts are used throughout the country, and the standardized language is not tailored to the laws of any specific state. Whether you are involved in single-family, attached or mixed-use projects, if your work is performed in California, your contracts must now incorporate the provisions of SB 800.
WHAT IS SB 800?
SB 800 is legislation enacted in California to provide a framework for the identification and resolution of construction defect claims short of formal litigation. It is a prelitigation process. Embodied in California Civil Code section 895 et seq., SB 800 provides builders, architects, subcontractors, suppliers and others with the right to repair claimed construction deficiencies before a lawsuit can be brought by an owner. Adherence with the procedural requirements, which are complicated and contain numerous strict deadlines, is a prerequisite to the protections afforded by this legislation.
SB 800 applies to all new residential housing, detached and attached, if the purchase contract was signed by the builder on or after January 1, 2003.
SB 800 sets forth minimum standards for everything including the kitchen sink. The standards, set forth in California Civil Code section 896, address the appropriate construction and performance, for set periods of time, of windows, doors, decks, roofs, balconies, foundations, drainage, stucco, plumbing, shower and bath components, and various other building components so as to avoid water intrusion through the building envelope. There are also minimum standards associated with the structural, electrical, plumbing and mechanical systems of a residence. Compliance with standards of the industry and/or plans and specifications no longer provide a defense to a claim. Instead, the minimum standards set forth in Code of Civil Procedure section 896 govern whether or not a residential building is defective.
TIMING IS EVERYTHING
SB 800 provides specific and non-negotiable procedures and deadlines to, among other things, make a claim, respond to a claim, produce requested documents, inspect deficient conditions, identify those who will perform the repairs, issue a written offer to repair and a response thereto, and make repairs. A failure to comply with any given procedure or deadline takes you out of the protections of SB 800 and enables the owner to file a formal lawsuit.
AIA CONTRACT REVISION IN LIGHT OF SB 800
Does your contract require the parties to comply with the requirements of SB 800 so that you are afforded the opportunity to evaluate and repair conditions before the commencement of formal litigation? Does your contract spell out your rights to be notified of a claim and participate in the inspection and repair process?
Does your contract set forth the requirements and obligations to design and construct in accord with the minimum standards, provide a written warranty, maintain documents for production in the event of a claim, and be bound by and adhere to the very strict time deadlines that impact upon your ability to enjoy the protections afforded by the legislation?
Does your contract spell out what remedies you have if a party breaches contract terms addressing SB 800 so as to expose you to civil litigation?
If your answer to any of the following questions is no, a visit to your attorney of choice is appropriate. Bear in mind that SB 800 reflects the current laws of California governing, in part, the design, construction and performance of residential housing and the dispute resolution process associated with claimed deficiencies or defects in new housing. Detailed familiarity with its provisions and the incorporation of these provisions into your AIA contracts is highly recommended.
September 2006 Builder Architect Edition Issue