Colorado Politics

Colorado Senate Republicans say a more robust construction defects effort is coming

Colorado Senate Republicans say the effort to curb construction defects lawsuits will go beyond the lone insurance component currently introduced in the legislature.

“There’s been some talk out there over Senate Bill 45, and I’ve been pretty clear … that we’re looking at a pretty comprehensive package of bills that will cover this topic, and 45 is just the beginning to this,” said Senate President Kevin Grantham, R-Cañon City, who said a package of legislation could some as early as the end of the week.

The question is how much support controlling Senate Republicans well get from Democrats, who have the majority in the House. Speaker Crisanta Duran, D-Denver, has expressed concerns with straying too far from the insurance element.

Perhaps the biggest sticking point will be over requiring mediation or arbitration before heading to court over shoddy construction.

Duran expressed skepticism over imposing such a mandate, arguing that it does not get to the heart of the issue.

Instead, Duran introduced a bill that aims at equitably dividing litigation defense costs. She is co-sponsoring the bill with Grantham. The legislation offers lawmakers one of their best chances at passing a significant bipartisan effort this year.

The bill would allow a judge to determine the allocation of defense costs, as opposed to the general contractor. Once a case is resolved, the courts would be able to re-evaluate the original demand to determine if the initial evaluation was appropriate, or tweak it if necessary.

Lawmakers hope that the bill would reduce costs for developers and contractors facing defect lawsuits, as well as curb the incentive for additional litigation, which would inspire them to build more affordable housing.

Developers and the business community, however, say the lone bill would do very little to offer them the confidence that they need to develop additional housing.

In addition to wanting the mediation requirement, builders say they also would like a majority of homeowners in an association to agree to file a lawsuit.

Senate Republican Leader Chris Holbert of Parker acknowledged the difficulty in finding broad agreement.

“It is precarious, it’s tenuous, it’s difficult,” Holbert said. “No one will come out of it saying they are the absolute winner, and we hope no one is the absolute loser, and I think that even includes the trial attorneys.”

Many in the business world expressed shock that the legislation was introduced so quickly without companion bills. They said they were blindsided, especially after legislative leaders in both chambers highlighted the effort in their opening day speeches.

Holbert acknowledged the frustration, saying, “It’s not a perfect process…. We wanted to put that out just to show first that there is that bipartisan, bicameral cooperation and discussion. That was not a shot across the bow.”

“There was never an indication by anyone that I was aware of that Senate Bill 45 was going to be the silver bullet,” Grantham added. “I’ve been pretty clear that this is going to be just the beginning of the package of bills.”


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