VOTERS IN COLORADO defeated Amendment 34 on Nov. 2, a measure that would have derailed the Notice and Opportunity to Repair (NOR) law that went into effect state-wide in April 2003 when the Colorado legislature passed House Bill 1161.

Rob Nanfelt, government affairs director for the Colorado Association of Home Builders, says builders, trade unions, Realtors, and other real estate–oriented groups raised $3.6 million to defeat the measure. Voters rejected Amendment 34 by a margin of 77 percent to 23 percent.

“Because of the NOR legislation, construction defect lawsuits are down in Colorado from 82 in all of 2003 to 22 this year through mid-November,” says Nanfelt. The bill set up a process in which a homeowner has to notify a builder of a defect before filing a lawsuit.

The NOR legislation also places a $250,000 cap on punitive damages and sets up a definition for actual damages by which the plaintiff could either receive: the fair-market value of the property without the defect; the cost of the repair; or the replacement cost of the property, whichever is less.

Nanfelt contends Amendment 34, which was pushed by two leading Colorado law firms, would have done the following:

  • Repeal the notification process.
  • Preserve the $250,000 cap on punitive damages but eliminate the cap on noneconomic damages such as pain and suffering.
  • Challenge compulsory arbitration subsections by inserting language that would state: “No law shall limit or impair a property owner's right to recover damages.”
  • Builders were also concerned that Amendment 34 would increase general liability insurance rates if passed.