CHAPTER 3. NOTICE AND OPPORTUNITY TO REPAIR
IC 32-27-3
Chapter 3. Notice and Opportunity to Repair
IC 32-27-3-1
Definitions
Sec. 1. The following definitions apply throughout this chapter:
(1) "Action" means any civil lawsuit or action in contract or tortfor damages or indemnity brought against a constructionprofessional to assert a claim, whether by complaint,counterclaim, or cross claim, for damage or the loss of use ofreal or personal property caused by a defect in the constructionof a residence or in the substantial remodeling of a residence."Action" does not include:
(A) a claim in bankruptcy; or
(B) any civil action in tort alleging personal injury to orwrongful death of a person or persons resulting from aconstruction defect.
(2) "Association" means an association of co-owners (asdefined in IC 32-25-2-2).
(3) "Claimant" means a home owner who or an association thatasserts a claim against a construction professional concerninga defect in the construction of a residence or in the substantialremodeling of a residence.
(4) "Construction professional" means an architect, a builder, abuilder vendor, a contractor, a subcontractor, or an engineer,including but not limited to any person performing or furnishingthe design, supervision, construction, or observation of theconstruction of any improvement to real property, whetheroperating as a sole proprietor, a partnership, a corporation, oranother business entity that contracts with the home owner tobuild the residence. A construction professional is not a homeowner under this chapter unless the construction professionaloccupies the residence that is the basis for the claimed defect.
(5) "Defect" or "construction defect" means damage ordeficiency in the residential construction, design, specifications,surveying, planning, supervision, testing, inspection, orobservation of construction.
(6) "Home owner" means:
(A) any person, company, firm, partnership, corporation,association, or other business entity that:
(i) is owner of the residence; and
(ii) contracts with a construction professional for theconstruction, sale, or construction and sale of a residence;or
(B) a subsequent purchaser of a residence from a homeowner.
(7) "Residence" means a:
(A) single family house;
(B) duplex;
(C) triplex; (D) quadraplex; or
(E) unit in a multiple unit residential structure in which titleto the individual unit is transferred to the owner under acondominium or cooperative system.
For purposes of clause (E), the term includes common areas andfacilities (as defined in IC 32-25-2-4).
(8) "Serve" or "service" means personal service or delivery bycertified mail to the last known address of the addressee.
(9) "Substantial remodeling" means a remodeling of aresidence, the total cost of which exceeds fifty percent (50%) ofthe assessed value under IC 6-1.1-1-3(a)(2) of the residence atthe time that the contract for the remodeling work was made.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-2
Notice of claim; response
Sec. 2. (a) At least sixty (60) days before filing a constructiondefect action against a construction professional, the claimant mustserve written notice of claim on the construction professional. Thenotice of claim must state that the claimant asserts a constructiondefect claim against the construction professional and must describethe claim in reasonable detail sufficient to determine the generalnature of the defect.
(b) Within twenty-one (21) days after service of a notice of claimunder subsection (a), the construction professional must serve awritten response on the claimant. The written response must do one(1) of the following:
(1) Propose to inspect the residence that is the subject of theclaim and complete the inspection within a specified timeframe. A response made under this subdivision must include thestatement that the construction professional shall, based on theinspection, offer to remedy the defect, compromise by payment,or dispute the claim.
(2) Offer to compromise and settle the claim by monetarypayment without inspection. A construction professional's offerunder this subdivision may include, but is not limited to, anexpress offer to purchase the claimant's residence that is thesubject of the claim and to pay the claimant's reasonablerelocation costs.
(3) State that the construction professional disputes the claimand will neither remedy the construction defect nor compromiseand settle the claim.
(c) If the construction professional terminates a proposal or offerunder section 3(c) of this chapter, the claimant may bring an actionagainst the construction professional for the construction defectclaim described in the notice of claim.
(d) A home owner is not required to serve an additional writtennotice for any additional defects discovered after the home owner hasserved an initial written notice of a construction defect in accordancewith this section.As added by P.L.134-2003, SEC.1.
IC 32-27-3-3
Action for construction defect; notice of rejection; notice toterminate offer or proposal
Sec. 3. (a) If the construction professional disputes the claim ordoes not respond to the claimant's notice of claim within the time setforth in section 2(b) of this chapter, the claimant may bring an actionagainst the construction professional for the claim described in thenotice of claim without further notice.
(b) If the construction professional makes:
(1) a proposal to inspect the residence under section 2(b)(1) ofthis chapter; or
(2) an offer to compromise and settle the claim by monetarypayment without inspection under section 2(b)(2) of thischapter;
and the claimant rejects the proposal or offer, the claimant mustserve written notice of the rejection on the construction professional.After service of the rejection, the claimant may bring an actionagainst the construction professional for the construction defectclaim described in the notice of claim.
(c) If the construction professional does not receive from theclaimant either an acceptance or rejection of the constructionprofessional's inspection proposal or settlement offer within sixty(60) days after the claimant's receipt of the constructionprofessional's response, the construction professional may terminatethe proposal or offer by serving written notice on the claimant.
(d) If the construction professional terminates a proposal or offerunder subsection (c), the claimant may bring an action against theconstruction professional for the construction defect claim describedin the notice of claim.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-4
Reasonable access for inspection; action for construction defect;notice of rejection; notice to terminate offer or proposal
Sec. 4. (a) If the construction professional makes a proposal toinspect the residence under section 2(b)(1) of this chapter and theclaimant elects to allow the construction professional to inspect inaccordance with the construction professional's proposal, theclaimant must provide the construction professional and theconstruction professional's contractors or other agents reasonableaccess to the claimant's residence during normal working hours toinspect the premises and the claimed defect.
(b) Within fourteen (14) days after the completion of aninspection pursuant to a proposal under section 2(b)(1) of thischapter, the construction professional must serve on the claimant:
(1) a written offer to remedy the construction defect at no costto the claimant, including a report of the scope of theinspection, the findings and results of the inspection, a
description of the additional construction necessary to remedythe defect described in the claim, and a timetable for thecompletion of such construction;
(2) a written offer to compromise and settle the claim bymonetary payment under section 2(b)(2) of this chapter; or
(3) a written statement that the construction professional willnot proceed further to remedy the defect.
(c) If the construction professional:
(1) makes a written offer to remedy the construction defectunder subsection (b)(1) but does not proceed further to remedythe construction defect within the agreed timetable; or
(2) fails to serve a written offer or statement on the claimantunder subsection (b);
the claimant may bring an action against the constructionprofessional for the claim described in the notice of claim withoutfurther notice.
(d) If the construction professional makes an offer undersubsection (b)(1) or (b)(2) to remedy the construction defect or tocompromise and settle the claim by monetary payment and theclaimant rejects the offer, the claimant shall serve written notice ofthe claimant's rejection on the construction professional. Afterservice of the rejection notice, the claimant may bring an actionagainst the construction professional for the construction defectclaim described in the notice of claim.
(e) If the construction professional makes an offer undersubsection (b)(1) or (b)(2) and does not receive an acceptance orrejection of the offer from the claimant within sixty (60) days afterthe claimant's receipt of the construction professional's response, theconstruction professional may terminate the offer by serving writtennotice on the claimant.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-5
Notice of acceptance; reasonable access to complete construction;agreement to alter offer
Sec. 5. (a) To accept the offer of a construction professional toremedy the construction defect under section (4)(b)(1) of thischapter, the claimant must serve on the construction professional awritten notice of acceptance within a reasonable time period afterreceipt of the offer, and not later than sixty (60) days after receipt ofthe offer.
(b) A claimant who accepts a construction professional's offerunder section 4(b)(1) of this chapter must provide the constructionprofessional and the construction professional's contractors or otheragents reasonable access to the claimant's residence during normalworking hours to perform and complete the construction by thetimetable stated in the offer.
(c) After the acceptance of an offer under section 4(b)(1) of thischapter, the claimant and construction professional may, by writtenmutual agreement, alter the extent of construction or the timetable
for completion of construction stated in the offer, including but notlimited to construction to repair additional defects.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-6
Dismissal
Sec. 6. Any action commenced by a claimant before compliancewith the requirements of this chapter is subject to dismissal withoutprejudice, and may not be recommenced until the claimant complieswith the requirements of this section.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-7
Commence action for construction defect
Sec. 7. Nothing in this section may be construed to prevent aclaimant from commencing an action on the construction defectclaim described in the notice of claim if the construction professionalfails to perform the construction agreed upon, fails to remedy thedefect, or fails to perform according to the timetable agreed uponunder section 4(b)(1) or 5 of this chapter.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-8
Amend notice of claim; date of original notice of claim applies
Sec. 8. (a) Before commencing any action alleging a constructiondefect, or after the dismissal of any action without prejudice undersection 6 of this chapter, the claimant may amend the notice of claimto include construction defects discovered after the service of theoriginal notice of claim.
(b) The service of an amended notice of claim relates back to theoriginal notice of claim for purposes of section 2 of this chapter andthe applicable statutes of limitations and repose.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-9
Attorney's fees and costs to construction professional; deductionof sums paid under warranty; failure to comply
Sec. 9. (a) If a claimant:
(1) unreasonably rejects a reasonable written offer of settlementmade under this chapter; or
(2) does not permit the construction professional a reasonableopportunity to inspect or to repair the defect under a reasonableoffer of settlement;
and thereafter commences an action governed by this chapter, thecourt may deny the claimant attorney's fees and costs and awardattorney's fees and costs to the construction professional. However,a homeowner is not required to accept an offer to repair the defectwhen the defect is caused by the construction professional'snoncompliance with applicable building codes.
(b) Any sums paid under a homeowners warranty, other than sums
paid in satisfaction of claims that are collateral to any coverageissued to or by the construction professional, must be deducted fromany recovery.
(c) If a construction professional fails to comply with therequirements of this chapter, the claimant is not obligated to complyfurther with the provisions of this chapter.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-10
Attorney's fees and costs to claimant
Sec. 10. If a construction professional unreasonably:
(1) disputes a home owner's claim;
(2) fails to remedy or compromise and settle the claim;
(3) fails to repair the construction defect within a reasonabletime, subject to the nature of the repair or some unforeseenevent not caused by the construction professional; or
(4) fails to respond to a notice;
and the claimant commences an action governed by this chapter andprevails in the action, the court may award attorney's fees and coststo the claimant.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-11
Filing; list of defects
Sec. 11. (a) In every action brought against a constructionprofessional, the claimant must file with the court and serve on thedefendant a list of known construction defects in accordance withthis section.
(b) The list of known construction defects must contain adescription of the construction that the claimant alleges to bedefective. The list of known construction defects must be filed withthe court and served on the defendant within sixty (60) days after thecommencement of the action or within such longer period as thecourt in its discretion may allow.
(c) The list of known construction defects may be amended by theclaimant to identify additional construction defects as they becomeknown to the claimant.
(d) The list of known construction defects must specify, to theextent known to the claimant, the construction professionalresponsible for each alleged defect identified by the claimant.
(e) If a subcontractor or supplier is added as a party to an actionunder this section, the party making the claim against thesubcontractor or supplier must serve on the subcontractor or supplierthe list of construction defects in accordance with this section withinsixty (60) days after service of the complaint against thesubcontractor or supplier, or within such period as the court in itsdiscretion may allow.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-12 Notice of right to offer to cure; action not barred
Sec. 12. (a) Upon entering into a contract for sale, construction,or substantial remodeling of a residence, a construction professionalmust provide notice to each home owner of the constructionprofessional's right to offer to cure construction defects before ahome owner may commence litigation against the constructionprofessional. The notice must be conspicuous and may be includedas part of the underlying contract signed by the home owner.
(b) The notice required by this section must be in substantially thefollowing form:
"IC 32-27-3 CONTAINS IMPORTANT REQUIREMENTSYOU MUST FOLLOW BEFORE YOU MAY FILE ALAWSUIT FOR DEFECTIVE CONSTRUCTION AGAINSTTHE CONTRACTOR OR BUILDER OF YOUR HOME.SIXTY (60) DAYS BEFORE YOU FILE YOUR LAWSUIT,YOU MUST DELIVER TO THE CONTRACTOR ORBUILDER A WRITTEN NOTICE OF ANY CONSTRUCTIONCONDITIONS YOU ALLEGE ARE DEFECTIVE ANDPROVIDE YOUR CONTRACTOR OR BUILDER THEOPPORTUNITY TO MAKE AN OFFER TO REPAIR ORPAY FOR THE DEFECTS. YOU ARE NOT OBLIGATED TOACCEPT ANY OFFER MADE BY THE BUILDER ORCONTRACTOR. HOWEVER, IF YOU UNREASONABLYREJECT A REASONABLE WRITTEN OFFER ANDCOMMENCE AN ACTION AGAINST THE BUILDER ORCONTRACTOR, A COURT MAY AWARD ATTORNEY'SFEES AND COSTS TO THE BUILDER OR CONTRACTOR.THERE ARE STRICT DEADLINES AND PROCEDURESUNDER STATE LAW, AND FAILURE TO FOLLOW THEMMAY AFFECT YOUR ABILITY TO FILE A LAWSUIT.".
(c) This chapter does not preclude or bar any action if notice isnot given to the home owner as required by this section.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-13
Contractual relationship not affected
Sec. 13. Nothing in this chapter shall be construed to hinder orotherwise affect the employment, agency, or contractual relationshipbetween and among home owners and construction professionalsduring the process of construction or remodeling and does notpreclude the termination of those relationships as allowed undercurrent law. Nothing in this chapter shall negate or otherwise restricta construction professional's right to access or inspection providedby law, covenant, easement, or contract.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-14
Tolling of statute of limitations
Sec. 14. If a written notice of claim is served under section 2 ofthis chapter within the time prescribed for the filing of an action
against a construction professional based on an alleged constructiondefect, the applicable statute of limitations for construction relatedclaims is tolled with respect to the alleged construction defectdescribed in the notice of claim from the day on which the notice ofclaim is served until sixty (60) days after the period of time duringwhich the filing of an action is barred under this chapter.
As added by P.L.134-2003, SEC.1.