Aurora, CO asked in Real Estate Law and Construction Law for Colorado

Q: We are building a home in Colorado and our builder has had endless delays and constant excuses as to why it’s not done.

Our original move in date was July 15, then August 15, August 25, now October 1st. He didn’t even start the foundation clearing until August 25th, it’s not been touched since then. The house is complete (modular) and off site, waiting on the site to be complete.

He is paying for a rental house for us as we moved from out of state but still has excuse after excuse as to why it won’t be ready. What legal recourse do we have?

Our contract states 120 days from funding, he’s long past that.

2 Lawyer Answers
James Alan Greer
James Alan Greer
Answered
  • Construction Law Lawyer
  • Boulder, CO
  • Licensed in Colorado

A: Dear Delayed Home Builder: Your question speaks of the phenomenon happening in CO (and other states) whereby the construction industry is "spread thin". I don't mention this to rebuke or to offer excuses for the Contractor, but delayed projects are a sig of the times. You have a contract with a 120 completion clause. Without the benefit of examining a copy, I will need to offer a series of questions to guide you. Q1: is there a penalty clause (for failing to complete on time). Q2: does the Contractor agree that they need to continue paying for the rental property (if they deny that obligation, you will need to insist under penalty of lawsuit/arbitration). Q3: have you incurred any actual losses because of the delay (examples: an income property loses rent but a personal residence does not have "loss of use" damages according to case law; whereas you may be incurring costs for extra loan expenses, or extra utilities) - if so, then you may want to present a Legal Demand for reimbursement of these costs. Q4: does the construction contract contain an "ADR Clause" ? meaning, is there arbitration (rather than court) because that would be less expensive to process a claim as compared with a trial. Q5: is there an attorneys fees provision, because if there is then the contractor understands that they may have to pay your fees in a claims pursuit. These are the questions that need to be examined for you to guide your next steps.

JIM GREER is an attorney licensed to practice in CO and CA and has specialized in real estate matters for the past 30 years; nothing herein shall be construed as the offering of legal advice insofar as Mr. Greer is not in an attorney-client capacity with the inquiring party. 303.818.8422

Donald C Eby
Donald C Eby
Answered
  • Castle Rock, CO
  • Licensed in Colorado

A: Your rights are completely dependant upon your contract.

I recommend contacting an attorney to review your contract and discuss your rights, remedies, options, etc. That attorney may also send the Contractor a Demand Letter which may prove to be just the motivation you need.

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