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New Law Affects Builders By: James M. Dworman
A new Michigan law changes the rules for resolving disputes between builders and homeowners. Builders and maintenance/alteration contractors now may, by contract, require their homeowner customers to arbitrate complaints filed with the licensing division of the Dept. of Consumer & Industry Services. Public Act 113 of 2001, effective July 31, 2001, fundamentally changes the playing field for resolving builder-customer disputes. Previously, a consumer had two avenues to pursue complaints against licensed residential builders or maintenance and alteration contractors: the court system and the licensing department. If an aggrieved consumer was not satisfied with one result, the homeowner still could pursue claims via the other avenue. Now, a builder’s contract may provide for arbitration of all claims except for building code violations. Beside allowing for contractual agreements to arbitrate licensing complaints, this new law also provides that a licensing complaint regarding a builder’s workmanship must describe in writing its factual basis. The licensing department now must "presume the innocence" of the builder until a hearing officer finds otherwise. The law also requires a complainant to provide notice to a builder or maintenance and alteration contractor and make the residence accessible for any needed repairs. |
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