MISSISSIPPI LEGISLATURE
2003 Regular Session
To: Business and Financial Institutions
By: Senator(s) Robertson
AN ACT TO CREATE THE RESIDENTIAL BUILDERS NOTICE AND OPPORTUNITY TO CURE ACT; TO DEFINE CERTAIN TERMS; TO PROVIDE FOR THE DISMISSAL WITHOUT PREJUDICE OF ACTIONS WHICH WERE FILED WITHOUT COMPLYING WITH THE PROVISIONS OF THE ACT; TO PROVIDE THAT THE ACT SHALL NOT APPLY TO PERSONAL INJURY OR DEATH CLAIMS; TO PROVIDE NOTICE AND OPPORTUNITY TO REPAIR REQUIREMENTS PRIOR TO FILING AN ACTION AGAINST A CONTRACTOR OR SUBCONTRACTOR ARISING OUT OF THE CONSTRUCTION OF A DWELLING; TO REQUIRE A WRITTEN RESPONSE TO THE CLAIMANT; TO PROVIDE THAT CLAIMANTS MAY NOT AMEND THEIR LIST OF DEFECTS WITHOUT PROVIDING ADDITIONAL NOTICE AND OPPORTUNITY TO REPAIR TO CONTRACTORS; TO LIMIT THE DAMAGES WHICH MAY BE RECOVERED BY A CLAIMANT WHO UNREASONABLY REJECTS A CONTRACTOR'S OFFER TO REPAIR THE DEFECT OR TO OTHERWISE COMPENSATE THE CLAIMANT; TO PROVIDE THAT UPON ENTERING INTO A CONTRACT FOR SALE OF A DWELLING, NOTICE OF THE CONTRACTOR'S RIGHT TO CURE CONSTRUCTION DEFECTS SHALL BE GIVEN TO THE OWNER OF THE DWELLING; TO PROVIDE THAT HOMEOWNERS ASSOCIATIONS SHALL RECEIVE APPROVAL OF EITHER THEIR BOARD OF DIRECTORS, AFFECTED UNIT OWNERS OR MAJORITY OF ITS MEMBERS BEFORE COMMENCING CIVIL ACTIONS AGAINST CONTRACTORS; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. This act may be cited as the "Residential Builders Notice and Opportunity to Cure Act."
SECTION 2. As used in this act, unless the context requires otherwise:
(a) "Action" means any civil lawsuit or action or arbitration proceeding for damages or indemnity asserting a claim for injury or loss to a dwelling or personal property caused by an alleged defect arising out of or related to the design, construction, condition or sale of the dwelling or a remodel of a dwelling.
(b) "Claimant" means a residential homeowner, including a subsequent purchaser, or homeowner association who asserts a claim against a general contractor or a subcontractor concerning a defect in the design, construction, condition or sale of a dwelling or in the remodel of a dwelling.
(c) "Construction defect" means a deficiency in, or a loss or damage arising out of, the design, specifications, surveying, planning, supervision or construction of residential improvements that results from any of the following:
(i) Defective material, products or components used in the construction of residential improvements.
(ii) Violation of the applicable building codes in effect at the time of construction of residential improvements.
(iii) Failure of the design of residential improvements to meet the applicable standards of care in the residential construction industry at the time of governmental approval of the design and/or construction of the residential improvements.
(iv) Failure to construct residential improvements in accordance with accepted trade standards for good and workmanlike construction at the time of construction. (Compliance with the applicable codes in effect at the time of construction shall conclusively establish construction in accordance with accepted trade standards for good and workmanlike construction, with respect to all matters specified in those codes).
(d) "Contractor" means any person, firm, partnership, corporation, association or other organization that is engaged in the business of designing, developing, constructing, remodeling and/or repairing residential dwellings.
(e) "Design professional" means a person licensed in the state as an architect, interior designer, landscape architect, engineer or surveyor.
(f) "Dwelling" means a single-family residence, duplex or multifamily structure designed for residential use in which title to each individual residence, duplex or unit is transferred to the owner. A dwelling includes all of the systems, other components and improvements that are part of a residential dwelling at the time of construction.
(g) "Service" means personal service or delivery by certified mail, return receipt requested, to the last known address of the addressee.
(h) "Subcontractor" means a contractor who performs work on behalf of another contractor in the construction of a dwelling.
(i) "Supplier" means a person who provides materials, equipment or other supplies for the construction of a dwelling.
SECTION 3. If a claimant files a civil action against anyone or entity who designed, planned, developed, remodeled, repaired or constructed their residential dwelling, without first complying with the provisions of this act, on application by any defendant in or to the action, the court shall dismiss the action, without prejudice, and the action may not be refiled until the claimant has complied with the notice requirements of this act.
SECTION 4. Nothing in this act shall apply to actions arising out of claims for personal injury or death.
SECTION 5. (1) In every civil action brought against a contractor or subcontractor arising out of the construction of a dwelling, the claimant shall, no later than ninety (90) days prior to filing an action, serve written notice of claim on the contractor, by certified mail, return receipt requested. The notice of claim shall state that the owner/claimant of the residence asserts a construction defect claim and the notice of claim shall describe the claim or claims in reasonable detail sufficient to determine the general nature of any alleged construction defects and a description of the results of the defects, if known.
(2) Within fifteen (15) days after the initial service of the notice of claim required in subsection (1), the general contractor or subcontractor shall forward a copy of the notice to each subcontractor, supplier and design professional who were involved in any manner and to any extent in the design, planning, construction or repair of the residential dwelling and believed to be responsible for a defect specified in the notice and include with the notice the specific defect for which the contractor believes the subcontractor, supplier or design professional is responsible.
(3) On the request of the contractor, subcontractor, supplier or design professional who has received a notice pursuant to subsection (1) or subsection (2) of this section, the claimant shall provide to the contractor, subcontractor, supplier or design professional any evidence that depicts the nature and cause of the defect and the nature and extent of repairs necessary to remedy the defect, including expert reports, photographs, and videotapes, if that evidence would be discoverable under the Mississippi Rules of Civil Procedure.
(4) Within thirty (30) days after service of the notice of claim by claimant required in subsection (1) or subsection (2), each contractor, subcontractor, supplier or design professional that has received a notice of claim shall serve a written response on the claimant by registered mail or personal service. The written response shall:
(a) Offer to compromise and settle the claim by monetary payment without inspection; or
(b) Propose to inspect the dwelling that is the subject of the claim and propose to remedy the defect; or
(c) State that the contractor, subcontractor, supplier or design professional disputes the claim and will neither remedy the alleged construction defect nor compromise and settle the claim.
(5) If the contractor, subcontractor, supplier or design professional disputes the claim (pursuant to subsection (4)(c)) and (a) refuses to remedy the alleged construction defect, or (b) refuses to offer a reasonable compromise and settlement of the claim, or (c) does not respond to the claimant’s notice of claim within the time stated in subsection (4), the claimant may bring a civil action against the contractor, subcontractor, supplier or design professional for the claim described in the notice of claim without further notice.
(6) If the claimant rejects the offer made by the contractor, subcontractor, supplier or design professional to either remedy the construction defect or to compromise and settle the claim by monetary payment, the claimant shall serve written notice of the claimant’s rejection on the contractor, subcontractor, supplier or design professional by certified mail, return receipt requested. The notice shall include the basis for the claimant’s rejection of the contractor, subcontractor, supplier or design professional’s proposal/offer. After service of the rejection the claimant may bring an action against the contractor, subcontractor, supplier or design professional for the claim described in the initial notice of claim as required under subsection (1) above, without further notice.
(7) If the claimant elects to allow the contractor, subcontractor, supplier or design professional to remedy the dwelling in accordance with the contractor, subcontractor, supplier or design professional’s proposal pursuant to subsection (4)(b), the claimant shall provide the contractor, subcontractor, supplier or design professional and its contractors or other agents reasonable access to the claimant’s residence during normal working hours to determine the nature and cause of the alleged defects and the nature and extent of any repairs or replacements necessary to remedy the alleged defects, and to remedy the claimed defect.
(8) If a claimant accepts a contractor, subcontractor, supplier or design professional’s offer made pursuant to subsection (4), and the contractor, subcontractor, supplier or design professional does not proceed to complete the monetary payment or remedy the construction defect as agreed to with claimant within the agreed timetable, the claimant may bring an action against the contractor, subcontractor, supplier or design professional for the claim described in the initial notice of claim required by subsections (1) and (2) without further notice.
(9) If a claimant unreasonably rejects an offer made as provided by this section or does not permit the contractor, subcontractor, supplier or design professional a reasonable opportunity to inspect and repair the defect pursuant to an accepted offer of settlement, the claimant may not recover an amount in excess of:
(a) The reasonable costs of the offered repairs which are necessary to cure the construction defect and which are the responsibility of the contractor, subcontractor, supplier or design professional; or
(b) The amount of the monetary settlement offered by the contractor, subcontractor, supplier or design professional.
(10) Any claimant accepting the offer of the contractor, subcontractor, supplier or design professional to remedy the construction defects, shall do so by serving the contractor, subcontractor, supplier or design professional with a written notice of acceptance within a reasonable period of time after receipt of the offer but no later than thirty (30) days after receipt of the offer. The claimant’s notice of acceptance shall be served on the contractor, subcontractor, supplier or design professional by certified mail, return receipt requested.
(11) A claimant’s failure to do any of the following is admissible in any dwelling civil action filed and creates a rebuttable presumption that the claimant’s damages could have been mitigated:
(a) Allow a reasonable inspection requested by the contractor, subcontractor, supplier or design professional of any claimed construction defect.
(b) Provide a good faith, written response to a contractor, subcontractor, supplier or design professional’s offer to repair or remedy any proposed construction defect.
(12) Absent good cause, the contractor, subcontractor, supplier or design professional’s failure to respond in good faith to the claimant’s notice pursuant to subsection (1) shall preclude the contractor, subcontractor, supplier or design professional from asserting that the claimant did not comply with the provisions of this act.
(13) A claimant’s written notice pursuant to subsection (1) tolls the applicable statute of limitations until ninety (90) days after the contractor, subcontractor, supplier or design professional receives the notice.
SECTION 6. A construction defect which is discovered after a claimant has provided a contractor with the original claim notice required in Section 4 of this act, may not be alleged until the claimant has given the contractor, subcontractor, supplier or design professional who performed the original construction:
(a) Written notice of the alleged defect required by Section 4 of this act; and
(b) A reasonable opportunity to repair the alleged construction defect in the manner provided in Section 4 of this act.
SECTION 7. (1) Upon entering into a contract for sale, construction or substantial remodeling of a dwelling, the contractor, subcontractor, supplier or design professional shall provide notice to the owner of the dwelling of the contractor, subcontractor, supplier or design professional’s right to offer to cure construction defects before a claimant may commence litigation against the contractor, subcontractor, supplier or design professional. Such notice shall be conspicuous and may be included as part of the underlying contract.
(2) The notice required by subsection (1) shall be in substantially the following form:
SENATE BILL NO. 2547, 2003 REGULAR SESSION, CONTAINS IMPORTANT REQUIREMENTS YOU MUST FOLLOW BEFORE YOU MAY FILE A LAWSUIT FOR DEFECTIVE CONSTRUCTION AGAINST THE CONTRACTOR WHO CONSTRUCTED YOUR HOME. NINETY (90) DAYS BEFORE YOU FILE YOUR LAWSUIT, YOU MUST DELIVER TO THE CONTRACTOR A WRITTEN NOTICE OF ANY CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE AND PROVIDE YOUR CONTRACTOR AND ANY SUBCONTRACTORS, SUPPLIERS OR DESIGN PROFESSIONALS THE OPPORTUNITY TO MAKE AN OFFER TO REPAIR OR PAY FOR THE DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT ANY OFFER MADE BY THE CONTRACTOR OR ANY SUBCONTRACTORS, SUPPLIERS OR DESIGN PROFESSIONALS. THERE ARE STRICT DEADLINES AND PROCEDURES UNDER STATE LAW, AND FAILURE TO FOLLOW THEM MAY AFFECT YOUR ABILITY TO FILE A LAWSUIT.
SECTION 8. (1) A homeowner's association may bring an action to recover damages resulting from construction defects in any of the units, common elements or limited common elements of the common-interest community only:
(a) If the association first obtains the written approval of each unit’s owner whose unit or interest in the common elements or limited common elements will be the subject of the action or claim; or
(b) Upon obtaining a majority vote of the members of the association; or
(c) Upon a vote of the board of directors of the association.
(2) When a homeowner association commences an action for or on behalf of an owner of a unit, the association shall provide written notice to the owner of each unit at least thirty (30) calendar days prior to the filing of the civil action.
(3) The board of directors of an association may, upon giving thirty (30) days' prior notice to the units’ owners, employ a contractor and such other persons as are necessary to make such repairs to a unit or common element within the common-interest community as are required to protect the health, safety and welfare of the units’ owners.
SECTION 9. Nothing in this act shall be read or constituted to in any way alter or amend any statutes of limitations which would otherwise be applicable and/or controlling to actions arising out of construction deficiencies. Nothing in this act shall be read or constituted to any way alter or amend the New Home Warranty Act, Section 83-58-1 et seq.
SECTION 10. This act shall take effect and be in force from and after July 1, 2003.