Proposition 201 – Homeowners’ Bill of Rights

Proposition 201 – Homeowners’ Bill of Rights appears to have been drafted in response to the excessive number of new homes built during the last decade’s building boom with construction defects.

Statute currently allows only the original home buyer to file a dwelling action within eight years of purchase.

This measure would impose new requirements on homebuilders, extending the warranty period on materials and workmanship to ten-years and makes it transferrable to subsequent buyers within that period.

It also prohibits sellers or purchasers from agreeing to or allowing any “reasonable alternative dispute resolution” procedures to be included in sales contracts and goes as far as granting “prospective buyers” the right to sue in a dwelling action.

Aside from buyers who may have ended up with nightmare homes, rife with defects, it’s the Sheet Metal International Association and AFL-CIO that placed the initiative on the ballot.

Josh Stockton of Mesa submitted an argument in support of the proposition, stating, “I hear opponents to Prop. 201 say that this will lead Arizona towards having a unionized construction industry. I say, what’s wrong with that! Arizona’s construction industry should be all union, and if it takes an initiative to accomplish this, so be it.”

Nate Porter of Mesa also supports the initiative, stating, Moving here from California, I couldn’t believe there wasn’t any laws in place that I could use to pressure builders into offering me a better price or more upgrades on my home. Fortunately, Prop. 201 opens the litigation statutes up to prospective buyers as well, so now I can contact my attorney if I believe a builder isn’t offering me a fair price.”

Beau Flahart of Gilbert says, “Some people try to give lawyers a bad name, but using the court process is a legitimate and smart way to make money,” and that’s why he supports Proposition 201.

Organizations supporting Proposition 201 include Interfaith Worker Justice of Arizona, Arizona Advocacy Network, Coalition for Better Construction, Air Conditioning Excellence Coalition, Arizona Alliance for Retired Americans and the AFL-CIO.

Spencer Kamps, chairman of Arizonans Against Lawsuit Abuse wrote in opposition to the measure, pointing out it prohibits parties from agreeing to resolve their disputes without going to court, forbids the seller from recovering any attorney’s fees even if they win or the case was frivolous, it doesn’t even require the plaintiff to purchase a home in order to sue by allowing prospective buyers to file complaints.

Sen. Barbara Leff, R-Phoenix, wrote an opposition argument stating the title “Homeowners Bill of Rights” is misleading and the only bill you will see is an increase in your legal bills.
She notes the measure affords homeowners fewer rights than currently provided by state law by making litigation the only option and eliminating the “loser pays court fees” statutes, encouraging lawyers to go to court and making them the only winners in the process.

There is plenty of opposition to the measure, aside from Arizona’s home builders associations, WESTMARC and Arizona Chamber of Commerce.

Individuals, including an attorney, submitted opposition statements stating the measure could drive many small companies out of business, with many resenting the imposition of a legal process that mandates parties go to court and prohibits all other means of resolving disputes.

Steve Voeller of Phoenix calls it the “Frivolous Lawsuit Initiative,” stating it will not benefit homeowners and would be a gift to unscrupulous lawyers.

He concludes, “In this economic downturn, the last thing we need is to further hurt the housing market while directing more money to unions and unscrupulous lawyers.”