2014 Indiana Code TITLE 32. PROPERTY ARTICLE 27. CONSTRUCTION WARRANTIES ON REAL PROPERTY CHAPTER 3. NOTICE AND OPPORTUNITY TO REPAIR
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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 tort
for damages or indemnity brought against a construction
professional to assert a claim, whether by complaint,
counterclaim, or cross claim, for damage or the loss of use of
real or personal property caused by a defect in the construction
of 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 or
wrongful death of a person or persons resulting from a
construction defect.
(2) "Association" means an association of co-owners (as defined
in IC 32-25-2-2).
(3) "Claimant" means a home owner who or an association that
asserts a claim against a construction professional concerning a
defect in the construction of a residence or in the substantial
remodeling of a residence.
(4) "Construction professional" means an architect, a builder, a
builder vendor, a contractor, a subcontractor, or an engineer,
including but not limited to any person performing or furnishing
the design, supervision, construction, or observation of the
construction of any improvement to real property, whether
operating as a sole proprietor, a partnership, a corporation, or
another business entity that contracts with the home owner to
build the residence. A construction professional is not a home
owner under this chapter unless the construction professional
occupies the residence that is the basis for the claimed defect.
(5) "Defect" or "construction defect" means damage or
deficiency in the residential construction, design, specifications,
surveying, planning, supervision, testing, inspection, or
observation 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 the
construction, sale, or construction and sale of a residence;
or
(B) a subsequent purchaser of a residence from a home
owner.
(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 title
to the individual unit is transferred to the owner under a
condominium or cooperative system.
For purposes of clause (E), the term includes common areas and
facilities (as defined in IC 32-25-2-4).
(8) "Serve" or "service" means personal service or delivery by
certified mail to the last known address of the addressee.
(9) "Substantial remodeling" means a remodeling of a residence,
the total cost of which exceeds fifty percent (50%) of the
assessed value under IC 6-1.1-1-3(a)(2) of the residence at the
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 construction
defect action against a construction professional, the claimant must
serve written notice of claim on the construction professional. The
notice of claim must state that the claimant asserts a construction
defect claim against the construction professional and must describe
the claim in reasonable detail sufficient to determine the general
nature of the defect.
(b) Within twenty-one (21) days after service of a notice of claim
under subsection (a), the construction professional must serve a
written 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 the
claim and complete the inspection within a specified time frame.
A response made under this subdivision must include the
statement that the construction professional shall, based on the
inspection, offer to remedy the defect, compromise by payment,
or dispute the claim.
(2) Offer to compromise and settle the claim by monetary
payment without inspection. A construction professional's offer
under this subdivision may include, but is not limited to, an
express offer to purchase the claimant's residence that is the
subject of the claim and to pay the claimant's reasonable
relocation costs.
(3) State that the construction professional disputes the claim
and will neither remedy the construction defect nor compromise
and settle the claim.
(c) If the construction professional terminates a proposal or offer
under section 3(c) of this chapter, the claimant may bring an action
against the construction professional for the construction defect claim
described in the notice of claim.
(d) A home owner is not required to serve an additional written
notice for any additional defects discovered after the home owner has
served an initial written notice of a construction defect in accordance
with this section.
As added by P.L.134-2003, SEC.1.
IC 32-27-3-3
Action for construction defect; notice of rejection; notice to
terminate offer or proposal
Sec. 3. (a) If the construction professional disputes the claim or
does not respond to the claimant's notice of claim within the time set
forth in section 2(b) of this chapter, the claimant may bring an action
against the construction professional for the claim described in the
notice of claim without further notice.
(b) If the construction professional makes:
(1) a proposal to inspect the residence under section 2(b)(1) of
this chapter; or
(2) an offer to compromise and settle the claim by monetary
payment without inspection under section 2(b)(2) of this
chapter;
and the claimant rejects the proposal or offer, the claimant must serve
written notice of the rejection on the construction professional. After
service of the rejection, the claimant may bring an action against the
construction professional for the construction defect claim described
in the notice of claim.
(c) If the construction professional does not receive from the
claimant either an acceptance or rejection of the construction
professional's inspection proposal or settlement offer within sixty
(60) days after the claimant's receipt of the construction professional's
response, the construction professional may terminate the proposal or
offer by serving written notice on the claimant.
(d) If the construction professional terminates a proposal or offer
under subsection (c), the claimant may bring an action against the
construction professional for the construction defect claim described
in 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 to
inspect the residence under section 2(b)(1) of this chapter and the
claimant elects to allow the construction professional to inspect in
accordance with the construction professional's proposal, the claimant
must provide the construction professional and the construction
professional's contractors or other agents reasonable access to the
claimant's residence during normal working hours to inspect the
premises and the claimed defect.
(b) Within fourteen (14) days after the completion of an inspection
pursuant to a proposal under section 2(b)(1) of this chapter, the
construction professional must serve on the claimant:
(1) a written offer to remedy the construction defect at no cost
to the claimant, including a report of the scope of the inspection,
the findings and results of the inspection, a description of the
additional construction necessary to remedy the defect described
in the claim, and a timetable for the completion of such
construction;
(2) a written offer to compromise and settle the claim by
monetary payment under section 2(b)(2) of this chapter; or
(3) a written statement that the construction professional will not
proceed further to remedy the defect.
(c) If the construction professional:
(1) makes a written offer to remedy the construction defect
under subsection (b)(1) but does not proceed further to remedy
the construction defect within the agreed timetable; or
(2) fails to serve a written offer or statement on the claimant
under subsection (b);
the claimant may bring an action against the construction professional
for the claim described in the notice of claim without further notice.
(d) If the construction professional makes an offer under
subsection (b)(1) or (b)(2) to remedy the construction defect or to
compromise and settle the claim by monetary payment and the
claimant rejects the offer, the claimant shall serve written notice of
the claimant's rejection on the construction professional. After service
of the rejection notice, the claimant may bring an action against the
construction professional for the construction defect claim described
in the notice of claim.
(e) If the construction professional makes an offer under
subsection (b)(1) or (b)(2) and does not receive an acceptance or
rejection of the offer from the claimant within sixty (60) days after
the claimant's receipt of the construction professional's response, the
construction professional may terminate the offer by serving written
notice 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 to
remedy the construction defect under section (4)(b)(1) of this chapter,
the claimant must serve on the construction professional a written
notice of acceptance within a reasonable time period after receipt of
the offer, and not later than sixty (60) days after receipt of the offer.
(b) A claimant who accepts a construction professional's offer
under section 4(b)(1) of this chapter must provide the construction
professional and the construction professional's contractors or other
agents reasonable access to the claimant's residence during normal
working hours to perform and complete the construction by the
timetable stated in the offer.
(c) After the acceptance of an offer under section 4(b)(1) of this
chapter, the claimant and construction professional may, by written
mutual agreement, alter the extent of construction or the timetable for
completion of construction stated in the offer, including but not
limited 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 compliance
with the requirements of this chapter is subject to dismissal without
prejudice, and may not be recommenced until the claimant complies
with 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 a
claimant from commencing an action on the construction defect claim
described in the notice of claim if the construction professional fails
to perform the construction agreed upon, fails to remedy the defect,
or fails to perform according to the timetable agreed upon under
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 construction
defect, or after the dismissal of any action without prejudice under
section 6 of this chapter, the claimant may amend the notice of claim
to include construction defects discovered after the service of the
original notice of claim.
(b) The service of an amended notice of claim relates back to the
original notice of claim for purposes of section 2 of this chapter and
the 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; deduction of
sums paid under warranty; failure to comply
Sec. 9. (a) If a claimant:
(1) unreasonably rejects a reasonable written offer of settlement
made under this chapter; or
(2) does not permit the construction professional a reasonable
opportunity to inspect or to repair the defect under a reasonable
offer of settlement;
and thereafter commences an action governed by this chapter, the
court may deny the claimant attorney's fees and costs and award
attorney's fees and costs to the construction professional. However,
a homeowner is not required to accept an offer to repair the defect
when the defect is caused by the construction professional's
noncompliance 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 coverage issued
to or by the construction professional, must be deducted from any
recovery.
(c) If a construction professional fails to comply with the
requirements of this chapter, the claimant is not obligated to comply
further 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 reasonable
time, subject to the nature of the repair or some unforeseen
event not caused by the construction professional; or
(4) fails to respond to a notice;
and the claimant commences an action governed by this chapter and
prevails in the action, the court may award attorney's fees and costs
to 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 construction
professional, the claimant must file with the court and serve on the
defendant a list of known construction defects in accordance with this
section.
(b) The list of known construction defects must contain a
description of the construction that the claimant alleges to be
defective. The list of known construction defects must be filed with
the court and served on the defendant within sixty (60) days after the
commencement of the action or within such longer period as the court
in its discretion may allow.
(c) The list of known construction defects may be amended by the
claimant to identify additional construction defects as they become
known to the claimant.
(d) The list of known construction defects must specify, to the
extent known to the claimant, the construction professional
responsible for each alleged defect identified by the claimant.
(e) If a subcontractor or supplier is added as a party to an action
under this section, the party making the claim against the
subcontractor or supplier must serve on the subcontractor or supplier
the list of construction defects in accordance with this section within
sixty (60) days after service of the complaint against the
subcontractor or supplier, or within such period as the court in its
discretion 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 professional
must provide notice to each home owner of the construction
professional's right to offer to cure construction defects before a
home owner may commence litigation against the construction
professional. The notice must be conspicuous and may be included
as part of the underlying contract signed by the home owner.
(b) The notice required by this section must be in substantially the
following form:
"IC 32-27-3 CONTAINS IMPORTANT REQUIREMENTS
YOU MUST FOLLOW BEFORE YOU MAY FILE A
LAWSUIT FOR DEFECTIVE CONSTRUCTION AGAINST
THE CONTRACTOR OR BUILDER OF YOUR HOME.
SIXTY (60) DAYS BEFORE YOU FILE YOUR LAWSUIT,
YOU MUST DELIVER TO THE CONTRACTOR OR
BUILDER A WRITTEN NOTICE OF ANY CONSTRUCTION
CONDITIONS YOU ALLEGE ARE DEFECTIVE AND
PROVIDE YOUR CONTRACTOR OR BUILDER THE
OPPORTUNITY TO MAKE AN OFFER TO REPAIR OR
PAY FOR THE DEFECTS. YOU ARE NOT OBLIGATED TO
ACCEPT ANY OFFER MADE BY THE BUILDER OR
CONTRACTOR. HOWEVER, IF YOU UNREASONABLY
REJECT A REASONABLE WRITTEN OFFER AND
COMMENCE AN ACTION AGAINST THE BUILDER OR
CONTRACTOR, A COURT MAY AWARD ATTORNEY'S
FEES AND COSTS TO THE BUILDER OR CONTRACTOR.
THERE ARE STRICT DEADLINES AND PROCEDURES
UNDER STATE LAW, AND FAILURE TO FOLLOW THEM
MAY AFFECT YOUR ABILITY TO FILE A LAWSUIT.".
(c) This chapter does not preclude or bar any action if notice is not
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 or
otherwise affect the employment, agency, or contractual relationship
between and among home owners and construction professionals
during the process of construction or remodeling and does not
preclude the termination of those relationships as allowed under
current law. Nothing in this chapter shall negate or otherwise restrict
a construction professional's right to access or inspection provided by
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 of
this chapter within the time prescribed for the filing of an action
against a construction professional based on an alleged construction
defect, the applicable statute of limitations for construction related
claims is tolled with respect to the alleged construction defect
described in the notice of claim from the day on which the notice of
claim is served until sixty (60) days after the period of time during
which the filing of an action is barred under this chapter.
As added by P.L.134-2003, SEC.1.
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