Iowa Updates Owner and Contractor Obligations regarding Construction Defect Claims

You’ve just built your dream home. However, the dream quickly turns into a nightmare when a myriad of defects comes to light. The foundation is cracked, the trim is crooked, the cabinets are barely holding together. Many home owners simply would rather move on to a new contractor rather than continue to deal with someone who made so many mistakes.

However, in Iowa, doing so could seriously harm the homeowner’s possible efforts to go after the contractor. The Iowa Legislature recently enacted Senate File 532, which puts additional requirements on property owners. Before a property owner can file suit against a contractor for defective work, the owner must allow the contractor the opportunity to repair the defects, by giving the contractor written notice of a potential claim. The notice must describe the defects, and must specifically refer to the statutory chapter (Ch. 686). After providing the notice, the owner must wait 120 days before filing suit, or the courts will simply refuse to hear the case.

Once notice is provided, the contractor has 60 days to inspect the property and alleged defects. The contractor is entitled to access the property and is entitled to a list of the other contractors who performed work on the property. The contractor may then forward the notice to other contractors who may be responsible for the damage, who must respond to the original contractor within 30 days. The contractor who received the original notice must respond to the owner within 75 days of receiving the notice.

The contractor’s response to the owner must include either an offer to settle the claim in some way or an explicit rejection. Depending on the contractor’s answer, the owner may be able to pursue a lawsuit at that time. The owner may otherwise be obligated to response to the contractor’s settlement offer or offer to repair.

This new law puts burdens on both home owners and contractors they may not be aware of, yet that won’t be an excuse in court. If you’re a contractor or property owner involved in a dispute over construction defects, contact a Goosmann Law attorney at their Sioux City, Sioux Falls, or Omaha office today to help guide you through the process!