Belanger also expresses skepticism that construction giants like Pulte would take advantage of any loophole created by the decision. If, for example, Pulte Desert Vista Bloom LLC is formed to build a development, that company can hardly claim it bears no relation to Pulte Construction in court.

"It might take one more layer to connect the dots," Belanger says, "but they're all under the same umbrella. They're not going to hang one another out to dry."

But advocates who battle the construction industry are less likely to take it on trust. They say that builders and developers often win cases by wearing down the buyer. The more roadblocks they can throw up, the more likely a homeowner is forced to abandon the fight.

This could be a big roadblock.

In an amicus brief on behalf of the Arizona Consumers Council, attorney Lisa Borowsky argues, "If the decision of the court is left to stand, countless Arizona homeowners will surely be left with no legal recourse for damages resulting from the defective construction of their homes."


You'd think that kind of rhetoric would catch the attention of state officials.

You'd be wrong.

Although the appellate court decision makes it clear that homebuilder liability may be ripe for legislative debate, the Legislature has all but ignored it. Representative Rick Murphy, R-Glendale, introduced a bill that would hold builders accountable, albeit only in cases of condo conversions, but even that is languishing in committee.

Could it be because homebuilders are always among the top donors to state legislators? Or because homebuilder associations enjoy enviable popularity among politicians?

No way!

The regulatory agency for homebuilders is the Arizona Registrar of Contractors, or ROC. Clearly, the agency should care about the biggest threat to new homebuyers in years.

Yet, the Registrar of Contractors hasn't raised hue and cry with the legislators who might be allied with consumer groups. The ROC hasn't even filed an amicus brief with the Arizona Supreme Court.

It hasn't been for lack of an invitation.

Jim Eckley is a construction-defect lawyer in Phoenix. A true believer on the issue of homebuyer rights, he was shocked when he read the Lofts at Fillmore decision.

"This isn't about the survival of my practice," he says. "These types of cases are such a small part of what we do. But this has enormous ramifications for everybody in the state."

In December, Eckley e-mailed Fidelis Garcia, the Napolitano-appointed director of the Registrar of Contractors. Eckley titled his message "A freight train potentially coming for the ROC," and the language inside was no less dramatic.

"The ROC probably needs to be involved with something to reverse this, such as an amicus in an appeal to the Supreme Court," Eckley wrote.

In a two-line e-mail, Garcia promised to follow up with the attorney general. When Eckley e-mailed again last month, Garcia never wrote back. (Montgomery Lee, the assistant attorney general whose section represents the registrar, confirms that Garcia never asked for an amicus brief to be filed.)

Brian Livingston, a spokesman for the registrar, told me that the agency felt the matter was out of its jurisdiction; it's charged with disciplining builders who screw up, not assisting in litigation. The agency, he e-mailed, decided that "intervention is not warranted."

The Legislature isn't paying attention, the Registrar of Contractors isn't interested, and the attorney general is out of the loop.

And so it goes.

These days, I'm glad I'm a renter.

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6 comments
M Philip Escolar
M Philip Escolar

Looks like Ms. Fenske wasn't quite as "out to pasture" as many of the commenters would like to think! The AZ Supreme Court UNANIMOUSLY reversed the wacky Lofts decision of the Court of Appeals.

Now, builders will be held liable for their defective work and latent defects throughout the home's warranty period, or at least throughout the implied-by-law warranty period of six years.

John
John

This has got to be the most ridiculous article I have ever seen, all the article is referencing is some over zealous "renter" that obviously could not get approved for a mortgage and is renting some dilapidated shanty and is throwing his or her money in the garbage every month. "This is what you homeowners need", obviously someone has given this clown the authority to write whatever he pleases, this article is an opinion and he has provided no facts of pertinent information to his justification. To the writer, I know that you dislike living in a run-down apartment and understand that you are upset, because even you could not get approved by a sub-prime lender. You obviously need to find another job that you are better at, like maybe cleaning out septic tanks, because after all, you are very good in dealing with sh*t.

Mason
Mason

Mold problems like these are all too common due to lack of ventilation behind the brick. Masonry Innovations sells a product, BrickVent, designed to provide significant air flow to the space behind the brick. This helps keep the wall dry and control moisture related problems like mold. Go to www.brickvent.net for more information.

Kevin Peck
Kevin Peck

I would like to comment on the writer's reference to Arizona's current real estate market. It is stated that it is; "kind of hard to sell at a discount when you owe three times more than what the place is worth". Lets say a borrower did do a "subprime" loan at 100% of the purchase price, and lets say the purchase price was $150,000 at their time of purchase. Show me a place in the Valley where that same home is now selling for $50,000. The math doesn't add up, and this is another example of media sensationalizing the current real estate market to appear worse than it really is. Certainly, home prices are down, and some areas more than others. But even in the outlying areas (for example, Queen Creek), we don't see houses selling for $50,000.

Cindy
Cindy

I lived in Phoenix and Tempe for over 25 yrs and owned a new tract home in the valley in the 90's. I have lived in several states and owned new homes there, too. What Fenske is saying is true; builders often set up Limited Liability Corporations for developments and fold them when they're done. You often cannot go after a builder's other companies or assets no matter how valid your case or how serious the defects. Proving fraud and being able to 'pierce the corporate veil' is hard to do. Lawyers know these cases are money pits, and hard to collect on if you win, so they decline to help many homeowners.

WARRANTIES are a JOKE. These are from a separate company that escapes most state insurance regulation by forming a 'risk retention group.' The real warranty policy arrives after closing, a 'gift' from the builder that contains so many exceptions that the coverage is an illusion, a false sense of security, and a marketing tool for builders. If you make a claim on these warranty policies they frequently deny it or offer only pennies on the dollar...and if you want to dispute the claim you cannot sue a warranty co under most circumstances because they typically have a binding mandatory arbitration clause, and often they choose the arbitrator and do repeat business with them. Because these are private procedures, complaints that go to warranty arbitration are NOT public record so you can't find out when you're researching builders before buying.

It's outrageous that a state with a so-called good licensing agency lets things get this out of hand. If the ROC was doing what it was supposed to be doing, no builder, no matter how big or well connected, could keep building junky homes and getting away with it. And plenty ARE getting away with it.

Mr Bill
Mr Bill

It's no wonder your paper has a circulation of "Free outside of any store off of Van Buren" This is the most moronic article I've read on the housing industry yet! There are warantees on every home. The ROC won't comment, because they don't want to waste their time or give this "piece" credibility.

Given this loose interpretation of one potential issue, I believe that there are many builders out there that are happy that you're a renter too.

 
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