Bill Text: IA SSB1146 | 2019-2020 | 88th General Assembly | Introduced
Bill Title: A bill for an act relating to notice and opportunity to repair construction defects in new construction, and including effective date and applicability provisions.
Spectrum: Committee Bill
Status: (N/A - Dead) 2019-03-04 - Subcommittee recommends amendment and passage. [SSB1146 Detail]
Download: Iowa-2019-SSB1146-Introduced.html
Senate
Study
Bill
1146
-
Introduced
SENATE
FILE
_____
BY
(PROPOSED
COMMITTEE
ON
JUDICIARY
BILL
BY
CHAIRPERSON
ZAUN)
A
BILL
FOR
An
Act
relating
to
notice
and
opportunity
to
repair
1
construction
defects
in
new
construction,
and
including
2
effective
date
and
applicability
provisions.
3
BE
IT
ENACTED
BY
THE
GENERAL
ASSEMBLY
OF
THE
STATE
OF
IOWA:
4
TLSB
1974XC
(3)
88
asf/rn
S.F.
_____
Section
1.
NEW
SECTION
.
686.1
Definitions.
1
As
used
in
this
chapter,
unless
the
context
otherwise
2
requires:
3
1.
“Action”
means
any
civil
action
or
arbitration
proceeding
4
for
damages
or
indemnity
asserting
a
claim
for
injury
to
5
property,
real
or
personal,
or
injury
to
person
or
wrongful
6
death
arising
out
of
the
unsafe
or
defective
condition
of
an
7
improvement
to
real
property
based
on
tort,
breach
of
contract,
8
or
express
or
implied
warranty.
9
2.
“Association”
means
an
entity
or
homeowners
association
10
created
for
the
purposes
of
managing
the
operations
of
a
11
community
as
set
forth
in
a
declaration
of
covenants
or
12
declaration
of
submission
of
property
to
horizontal
property
13
regime
filed
of
record
in
the
county
that
the
property
is
14
located.
15
3.
“Claimant”
means
a
private
owner,
a
subsequent
private
16
owner,
or
an
association,
who
asserts
a
claim
in
a
class
action
17
for
damages
against
a
general
contractor
or
subcontractor
18
concerning
a
construction
defect.
“Claimant”
shall
not
include
19
a
public
corporation
as
defined
in
section
573.1.
20
4.
“Construction
defect”
means
an
alleged
or
actual
unsafe
21
or
defective
condition
of
an
improvement
to
real
property.
22
5.
“General
contractor”
means
a
person
who
does
work
or
23
furnishes
materials
by
contract,
express
or
implied,
with
an
24
owner.
25
6.
“Owner”
means
the
legal
or
equitable
titleholder
of
26
record
to
real
property
or
the
holder
of
a
leasehold
interest.
27
7.
“Serve”
,
“served”
,
or
“service”
means
delivery
by
28
certified
mail
with
a
United
States
postal
service
record
29
of
evidence
of
delivery
or
attempted
delivery
to
the
last
30
known
address
of
the
addressee,
by
hand
delivery
with
written
31
evidence
of
delivery,
or
by
delivery
by
any
courier
with
32
written
evidence
of
delivery.
33
8.
“Subcontractor”
means
a
person
furnishing
material
34
or
performing
labor
upon
any
building,
erection,
or
other
35
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1/
10
S.F.
_____
improvement
to
land,
except
those
having
contracts
directly
1
with
the
owner.
2
Sec.
2.
NEW
SECTION
.
686.2
Action
——
compliance.
3
1.
A
claimant
shall
not
file
an
action
without
first
4
complying
with
the
requirements
of
this
chapter.
If
a
claimant
5
files
an
action
alleging
a
construction
defect
without
first
6
complying
with
the
requirements
of
this
chapter,
on
timely
7
motion
by
a
party
to
the
action,
the
court
shall
stay
the
8
action,
without
prejudice,
and
the
action
shall
not
proceed
9
until
the
claimant
has
complied
with
the
requirements.
10
2.
An
action
filed
prior
to
the
expiration
of
the
11
statute
of
limitations
set
forth
in
section
614.1,
which
is
12
stayed
pursuant
to
this
section
and
for
which
the
statute
of
13
limitations
runs
during
the
time
the
claimant
is
complying
with
14
this
statute,
shall
not
be
deemed
barred
by
the
applicable
15
statute
of
limitation
for
the
pending
action
if
the
claimant
16
complies
with
the
requirements
of
this
chapter
and
the
action
17
is
otherwise
allowed
to
proceed.
18
Sec.
3.
NEW
SECTION
.
686.3
Notice
and
opportunity
to
19
repair.
20
1.
Prior
to
commencing
an
action
alleging
a
construction
21
defect,
the
claimant
shall,
at
least
one
hundred
twenty
days
22
before
filing
an
action,
serve
written
notice
of
claim
on
the
23
general
contractor
and
subcontractor.
The
notice
of
claim
24
shall
refer
to
this
chapter
and
must
describe
the
claim
in
25
reasonable
detail
sufficient
to
determine
the
general
nature
of
26
each
alleged
construction
defect,
a
description
of
the
damage
27
or
loss
resulting
from
the
defect,
if
known,
and
any
work
or
28
inspections
completed
to
determine
the
cause
of
the
damage
29
or
loss
or
correct
the
construction
defect.
This
subsection
30
does
not
preclude
a
claimant
from
filing
an
action
sooner
than
31
one
hundred
twenty
days,
after
service
of
written
notice
as
32
expressly
provided
in
subsection
6,
7,
or
8.
33
2.
a.
Within
sixty
days
after
service
of
the
notice
34
of
claim,
the
person
served
with
the
notice
of
claim
under
35
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10
S.F.
_____
subsection
1
is
entitled
to
perform
a
reasonable
inspection
1
of
the
property
or
of
each
unit
subject
to
the
claim
to
2
assess
each
alleged
construction
defect.
The
claimant
shall
3
provide
the
person
served
with
notice
under
subsection
1
and
4
the
person’s
general
contractors,
subcontractors,
or
agents
5
reasonable
access
to
the
property
during
normal
working
hours
6
to
inspect
the
property
to
determine
the
nature
and
cause
of
7
each
alleged
construction
defect
and
the
nature
and
extent
8
of
any
repairs
or
replacements
necessary
to
remedy
each
9
construction
defect.
The
person
served
with
notice
under
10
subsection
1
shall
reasonably
coordinate
the
timing
and
manner
11
of
any
and
all
inspections
with
the
claimant
to
minimize
the
12
number
of
inspections.
The
inspection
may
include
reasonable
13
destructive
testing
by
mutual
agreement
under
the
following
14
terms
and
conditions:
15
(1)
If
the
person
served
with
notice
under
subsection
1
16
determines
that
destructive
testing
is
necessary
to
determine
17
the
nature
and
cause
of
the
alleged
construction
defects,
the
18
person
shall
notify
the
claimant
in
writing.
19
(2)
The
notice
shall
describe
the
destructive
testing
20
to
be
performed,
the
person
selected
to
do
the
testing,
the
21
estimated
anticipated
damage
and
repairs
to
or
restoration
of
22
the
property
resulting
from
the
testing,
the
estimated
amount
23
of
time
necessary
for
the
testing
and
to
complete
the
repairs
24
or
restoration,
and
the
financial
responsibility
offered
for
25
covering
the
costs
of
repairs
or
restoration.
26
(3)
The
testing
shall
be
done
at
a
mutually
agreeable
time.
27
(4)
The
claimant
or
a
representative
of
the
claimant
may
be
28
present
to
observe
the
destructive
testing.
29
b.
If
the
claimant
refuses
to
agree
and
permit
reasonable
30
destructive
testing,
the
claimant
shall
have
no
claim
for
31
damages
which
could
have
been
avoided
or
mitigated
had
32
destructive
testing
been
allowed
when
requested
and
had
a
33
feasible
remedy
been
promptly
implemented.
34
3.
The
general
contractor
or
subcontractor
may
serve
a
35
-3-
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(3)
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3/
10
S.F.
_____
copy
of
the
notice
of
claim
to
each
subcontractor
or
general
1
contractor
whom
the
general
contractor
or
subcontractor
2
reasonably
believes
is
responsible
for
a
construction
defect
3
specified
in
the
notice
of
claim
and
shall
note
the
specific
4
construction
defect
for
which
the
subcontractor
or
general
5
contractor
is
alleged
to
be
responsible.
The
notice
described
6
in
this
subsection
shall
not
be
construed
as
an
admission
of
7
any
kind.
A
general
contractor
or
subcontractor
may
inspect
8
the
property
in
the
manner
described
in
subsection
2.
9
4.
Within
thirty
days
after
service
of
the
notice
of
10
claim
pursuant
to
subsection
3,
the
general
contractor
or
11
subcontractor
must
serve
a
written
response
to
the
general
12
contractor
or
subcontractor
who
served
the
notice
of
claim.
13
The
written
response
shall
include
a
report,
if
any,
of
14
the
scope
of
any
inspection
of
the
property,
the
findings
15
and
results
of
the
inspection,
a
statement
of
whether
the
16
subcontractor
or
general
contractor
is
willing
to
make
repairs
17
to
the
property
or
whether
the
claim
is
disputed,
a
description
18
of
any
repairs
the
subcontractor
or
general
contractor
is
19
willing
to
make
to
remedy
the
alleged
construction
defect,
and
20
a
timetable
for
the
completion
of
the
repairs.
This
response
21
may
also
be
served
on
the
initial
claimant
by
the
general
22
contractor
or
subcontractor.
23
5.
Within
seventy-five
days
after
service
of
the
notice
of
24
claim,
the
person
who
was
served
the
notice
under
subsection
1
25
shall
serve
a
written
response
to
the
claimant.
The
response
26
shall
be
served
to
the
attention
of
the
person
who
signed
the
27
notice
of
claim,
unless
otherwise
designated
in
the
notice
28
of
claim.
The
written
response
must
provide
for
one
of
the
29
following:
30
a.
A
written
offer
to
remedy
the
alleged
construction
defect
31
at
no
cost
to
the
claimant,
a
description
of
the
proposed
32
repairs
necessary
to
remedy
the
construction
defect,
and
a
33
timetable
for
the
completion
of
such
repairs.
34
b.
A
written
offer
to
compromise
and
settle
the
claim
by
35
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10
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_____
monetary
payment,
that
will
not
obligate
the
person’s
insurer,
1
and
a
timetable
for
making
payment.
2
c.
A
written
offer
to
compromise
and
settle
the
claim
by
3
a
combination
of
repairs
and
monetary
payment
that
will
not
4
obligate
the
person’s
insurer,
and
which
includes
a
detailed
5
description
of
the
proposed
repairs
and
a
timetable
for
the
6
completion
of
such
repairs
and
making
payment.
7
d.
A
written
statement
that
the
person
disputes
the
claim
8
and
will
not
remedy
the
construction
defect
or
compromise
and
9
settle
the
claim.
10
e.
A
written
statement
that
a
monetary
payment,
including
11
insurance
proceeds,
if
any,
will
be
determined
by
the
person’s
12
insurer
after
notification
to
the
insurer
by
means
of
serving
13
the
claim,
which
service
shall
occur
at
the
same
time
the
14
claimant
is
notified
of
this
settlement
option,
which
the
15
claimant
may
accept
or
reject.
A
written
statement
under
this
16
paragraph
may
also
include
an
offer
under
paragraph
“c”
,
but
17
such
offer
shall
be
contingent
upon
the
claimant
also
accepting
18
the
determination
of
the
insurer
whether
to
make
any
additional
19
monetary
payment.
20
6.
If
the
person
served
with
a
notice
of
claim
pursuant
21
to
subsection
1
disputes
the
claim
and
will
neither
remedy
22
the
construction
defect
nor
compromise
and
settle
the
claim,
23
or
does
not
respond
to
the
claimant’s
notice
of
claim
within
24
the
time
provided
in
subsection
5,
the
claimant
may,
without
25
further
notice,
proceed
with
an
action
against
that
person
for
26
the
claim
described
in
the
notice
of
claim.
Nothing
in
this
27
chapter
shall
be
construed
to
preclude
a
partial
settlement
or
28
compromise
of
the
claim
as
agreed
to
by
the
parties
and,
in
29
that
event,
the
claimant
may,
without
further
notice,
proceed
30
with
an
action
on
the
unresolved
portions
of
the
claim.
31
7.
A
claimant
who
receives
a
timely
settlement
offer
shall
32
accept
or
reject
the
offer
by
serving
written
notice
of
such
33
acceptance
or
rejection
on
the
person
making
the
offer
within
34
forty-five
days
after
receiving
the
settlement
offer.
If
35
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a
claimant
initiates
an
action
without
first
accepting
or
1
rejecting
the
offer,
the
court
shall
stay
the
action
upon
2
timely
motion
until
the
claimant
complies
with
this
subsection.
3
8.
If
the
claimant
timely
and
properly
accepts
the
offer
4
to
repair
an
alleged
construction
defect,
the
claimant
shall
5
provide
the
offeror
and
the
offeror’s
agents
reasonable
access
6
to
the
claimant’s
property
during
normal
working
hours
to
7
perform
the
repair
by
the
agreed-upon
timetable
as
stated
8
in
the
offer.
If
the
offeror
does
not
make
the
payment
or
9
repair
the
construction
defect
within
the
agreed
time
and
in
10
the
agreed
manner,
except
for
reasonable
delays
beyond
the
11
control
of
the
offeror,
including
but
not
limited
to
weather
12
conditions,
delivery
of
materials,
claimant’s
actions,
or
13
issuance
of
any
required
permits,
the
claimant
may,
without
14
further
notice,
proceed
with
an
action
against
the
offeror
15
based
upon
the
claim
in
the
notice
of
claim.
If
the
offeror
16
makes
payment
or
repairs
to
the
defect
within
the
agreed
17
time
and
in
the
agreed
manner,
the
claimant
is
barred
from
18
proceeding
with
an
action
for
the
claim
described
in
the
notice
19
of
claim
or
as
otherwise
provided
in
the
accepted
settlement
20
offer.
21
9.
This
section
does
not
prohibit
or
limit
a
claimant
from
22
making
any
necessary
emergency
repairs
to
the
property
as
are
23
required
to
protect
the
health,
safety,
and
welfare
of
any
24
person.
25
10.
Any
offer
or
failure
to
offer,
pursuant
to
subsection
5,
26
to
remedy
a
construction
defect
or
to
compromise
and
settle
the
27
claim
by
monetary
payment
does
not
constitute
an
admission
of
28
liability
with
respect
to
the
defect
and
is
not
admissible
in
29
an
action
that
is
subject
to
this
chapter.
30
11.
This
section
does
not
relieve
the
person
who
is
served
31
a
notice
of
claim
under
subsection
1
from
complying
with
all
32
contractual
provisions
of
any
liability
insurance
policy
as
33
a
condition
precedent
to
coverage
for
any
claim
under
this
34
section.
35
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10
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_____
Sec.
4.
NEW
SECTION
.
686.4
Multiple
construction
defects.
1
The
procedures
in
this
chapter
apply
to
each
construction
2
defect.
However,
a
claimant
may
include
multiple
defects
in
3
one
notice
of
claim.
A
claimant
may
amend
the
initial
list
of
4
construction
defects
to
identify
additional
or
new
construction
5
defects
as
the
defects
become
known
to
the
claimant.
The
court
6
shall
allow
the
action
to
proceed
to
trial
only
as
to
alleged
7
construction
defects
that
were
noticed
and
for
which
the
8
claimant
has
complied
with
this
chapter
and
as
to
construction
9
defects
reasonably
related
to,
or
caused
by,
the
construction
10
defects
previously
noticed.
Nothing
in
this
section
shall
11
preclude
subsequent
or
further
actions.
12
Sec.
5.
NEW
SECTION
.
686.5
Limitations
of
chapter.
13
This
chapter
does
not
do
any
of
the
following:
14
1.
Bar
or
limit
any
rights,
including
the
right
of
specific
15
performance
to
the
extent
such
right
would
be
available
in
the
16
absence
of
this
chapter,
any
causes
of
action,
or
any
theories
17
on
which
liability
may
be
based,
except
as
specifically
18
provided
in
this
chapter.
19
2.
Bar
or
limit
any
defense,
or
create
any
new
defense,
20
except
as
specifically
provided
in
this
chapter.
21
3.
Create
any
new
rights,
causes
of
action,
or
theories
on
22
which
liability
may
be
based.
23
Sec.
6.
NEW
SECTION
.
686.6
Effect
of
arbitration
clauses.
24
To
the
extent
that
an
arbitration
clause
in
a
contract
for
25
the
sale,
design,
or
construction
of
real
property
conflicts
26
with
this
chapter,
this
chapter
shall
control.
27
Sec.
7.
NEW
SECTION
.
686.7
Application.
28
1.
This
chapter
applies
to
construction
defects
in
new
29
construction.
This
chapter
does
not
apply
to
construction
30
defects
in
renovations
or
remodels.
31
2.
This
chapter
only
applies
to
actions
brought
pursuant
to
32
a
class
action.
33
Sec.
8.
EFFECTIVE
DATE.
This
Act,
being
deemed
of
immediate
34
importance,
takes
effect
upon
enactment.
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Sec.
9.
APPLICABILITY.
This
Act
applies
to
actions
for
1
which
litigation
has
not
commenced
prior
to
the
effective
date
2
of
this
Act.
3
EXPLANATION
4
The
inclusion
of
this
explanation
does
not
constitute
agreement
with
5
the
explanation’s
substance
by
the
members
of
the
general
assembly.
6
This
bill
relates
to
notice
and
opportunity
to
repair
7
construction
defects.
The
bill
proposes
a
new
Code
chapter
8
which
provides
a
mandatory
dispute
resolution
process
for
9
construction
defects
to
new
property,
which
are
originally
10
brought
as
class
actions.
The
bill
is
effective
upon
enactment
11
and
applies
to
actions
for
which
litigation
has
not
commenced
12
prior
to
the
effective
date
of
the
bill.
The
bill
provides
13
that
a
claimant
must
comply
with
the
requirements
set
forth
in
14
the
bill
before
filing
an
action.
The
bill
provides
that
if
a
15
claimant
files
an
action
alleging
a
construction
defect
without
16
first
complying
with
the
requirements
of
the
bill,
the
court
17
shall
stay
the
action
without
prejudice
until
the
requirements
18
have
been
met.
The
bill
sets
forth
specific
time
frames
for
19
each
part
of
the
dispute
resolution.
20
The
bill
provides
that
the
claimant
shall
serve
written
21
notice
of
a
construction
defect
claim
on
the
general
contractor
22
and
subcontractor.
In
the
notice,
the
claimant
shall
refer
23
to
the
new
Code
chapter
and
describe
the
claim
in
reasonable
24
detail
sufficient
to
determine
the
general
nature
of
each
25
alleged
construction
defect,
provide
a
description
of
the
26
damage
or
loss
resulting
from
the
defect,
if
known,
and
27
describe
any
work
or
inspections
completed
to
determine
the
28
cause
of
the
damage
or
loss
or
correct
the
construction
defect.
29
The
bill
provides
that
after
being
served
with
the
notice
30
of
claim,
the
person
is
entitled
to
perform
a
reasonable
31
inspection
of
the
property
or
of
each
unit
subject
to
the
32
claim
to
assess
each
alleged
construction
defect.
The
bill
33
provides
that
the
claimant
shall
provide
the
person
served
with
34
notice
reasonable
access
to
the
property
during
normal
working
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hours
to
inspect
the
property
to
determine
the
nature
and
1
cause
of
each
alleged
construction
defect
and
the
nature
and
2
extent
of
any
repairs
or
replacements
necessary
to
remedy
each
3
construction
defect.
The
bill
provides
additional
details,
4
including
providing
for
destructive
testing.
5
The
bill
provides
that
the
general
contractor
or
6
subcontractor
may
serve
a
copy
of
the
notice
of
claim
to
7
each
subcontractor
or
general
subcontractor
whom
the
general
8
contractor
or
subcontractor
reasonably
believes
is
responsible
9
for
each
construction
defect
specified
in
the
notice
of
claim.
10
The
bill
provides
that
subcontractors
shall
be
entitled
to
11
inspect
in
the
same
manner
as
general
contractors.
The
general
12
contractor
or
subcontractor
must
then
serve
a
written
response,
13
which
shall
include
a
report,
if
any,
of
the
scope
of
any
14
inspection
of
the
property,
the
findings
and
results
of
the
15
inspection,
a
statement
of
whether
the
general
contractor
or
16
subcontractor
is
willing
to
make
repairs
to
the
property
or
17
whether
such
claim
is
disputed,
a
description
of
any
repairs
18
they
are
willing
to
make,
and
a
timetable
for
the
completion
of
19
the
repairs.
This
response
may
also
be
served
on
the
initial
20
claimant
by
the
general
contractor.
21
The
bill
provides
that
the
person
who
was
served
the
notice
22
must
serve
a
written
response
to
the
claimant.
The
bill
23
provides
that
the
written
response
must
fall
into
one
of
five
24
categories,
which
are
laid
forth
in
the
bill.
25
If
the
person
served
with
a
notice
of
claim
disputes
the
26
claim
and
will
neither
remedy
the
construction
defect
nor
27
compromise
and
settle
the
claim,
or
does
not
respond
to
the
28
claimant’s
notice
of
claim
within
the
time
provided
in
the
29
bill,
the
claimant
may,
without
further
notice,
proceed
with
30
an
action
against
that
person
for
the
claim
described
in
the
31
notice
of
claim.
32
A
claimant
who
receives
a
timely
settlement
offer
must
33
accept
or
reject
the
offer
by
serving
written
notice
of
such
34
acceptance
or
rejection
on
the
person
or
company
making
the
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offer
within
the
time
period
set
forth
in
the
bill
after
1
receiving
the
settlement
offer.
The
bill
specifies
that
if
2
a
claimant
initiates
an
action
without
first
accepting
or
3
rejecting
the
offer,
the
court
shall
stay
the
action
upon
4
timely
motion
until
the
claimant
complies
with
the
requirement.
5
The
bill
provides
that
if
the
claimant
timely
and
properly
6
accepts
the
offer
to
repair
an
alleged
construction
defect,
7
the
claimant
shall
provide
the
offeror
and
the
offeror’s
8
agents
reasonable
access
to
the
claimant’s
property
during
9
normal
working
hours
to
perform
the
repair
by
the
agreed-upon
10
timetable
as
stated
in
the
offer.
If
the
offeror
does
not
make
11
the
payment
or
repair
the
construction
defect
within
the
agreed
12
time
and
in
the
agreed
manner,
except
for
reasonable
delays
13
beyond
the
control
of
the
offeror,
the
claimant
may,
without
14
further
notice,
proceed
with
an
action
against
the
offeror
15
based
upon
the
claim
in
the
notice
of
claim.
If
the
offeror
16
makes
payment
or
repairs
the
defect
within
the
agreed
time
and
17
in
the
agreed
manner,
the
claimant
is
barred
from
proceeding
18
with
an
action
for
the
claim
described
in
the
notice
of
claim
19
or
as
otherwise
provided
in
the
accepted
settlement
offer.
20
The
bill
does
not
bar
or
limit
any
rights,
including
the
21
right
of
specific
performance
to
the
extent
such
right
would
be
22
available
in
the
absence
of
the
new
Code
chapter,
any
causes
of
23
action,
or
any
theories
on
which
liability
may
be
based,
except
24
as
specifically
provided
in
the
bill.
Additionally,
the
bill
25
does
not
bar
or
limit
any
defense,
or
create
any
new
defense,
26
except
as
specifically
provided
in
the
new
Code
chapter.
27
Finally,
the
bill
does
not
create
any
new
rights,
causes
of
28
actions,
or
theories
on
which
liability
may
be
based.
29
The
bill
provides
that
to
the
extent
that
an
arbitration
30
clause
in
a
contract
for
the
sale,
design,
or
construction
of
31
real
property
conflicts
with
the
bill,
the
bill
shall
control.
32
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