Everything You Need to Know about Wisconsin’s “Right to Cure” Law
On October 1, 2006, Wisconsin’s Right to Cure Act came into effect, changing the landscape of the residential construction industry like never before. In the event that a dispute arises between a homeowner and a building contractor over an alleged defect in the construction or renovation of a residential dwelling, the Wisconsin court system is no longer the first option for recourse. Instead, homeowners looking to recoup funds and/or labor resulting in construction defects must first attempt to resolve the issue with the involved contractor, subcontractor, or materials supplier. Only after fulfilling a substantial amount of affirmative requirements and allowing statutorily-defined time periods to elapse may a homeowner take formal legal action.
As the first step in the process, Wis. Stat. § 101.148 requires builders and suppliers, at the time of contracting for construction or remodeling, to provide homeowners with a brochure prepared by the Wisconsin Department of Commerce explaining the rights and requirements of the Right to Cure Act and its impact on possible defect claims. This requirement routinely goes unmet.
Wis. Stat. § 895.07 then governs the procedure for filing a claim in the event of a property defect caused by a contractor or supplier related to the construction or remodeling of a dwelling. Per the statutes, a “defect” can mean any of the following: the use of defective raw materials, violation of applicable building codes, and/or failure to adhere to accepted trade standards for workmanlike construction.
Upon discovery of an alleged property defect and ninety (90) days prior to commencing legal action, a homeowner must deliver written notice of claim to the offending contractor, subcontractor, or materials supplier detailing the basis for the claim and any evidence in support of the claim. The homeowner must then give the contractor or supplier the opportunity to cure the defect.
Within fifteen (15) business days of receiving the notice of claim, the contractor or supplier must serve on the claimant one of the following:
(1) a written offer to repair the defect at no additional cost to the claimant, sufficiently detailing the nature and extent of necessary repairs.
(2) a written offer to settle the claim by monetary payment.
(3) a written offer containing both repair and monetary settlement components.
(4) a written statement rejecting the claim sufficiently detailing the grounds for rejection.
(5) a proposal for inspection of the dwelling and alleged defects, at which point the homeowner must allow reasonable access for inspection.
If a contractor or supplier tenders an offer for repair or settlement, the claimant may then choose to accept the terms of the offer, in whole or in part. If the claimant elects to reject the offer, they must serve written notice of their rejection upon the contractor or supplier within fifteen (15) business days of receiving the offer. The rejection must sufficiently detail the basis for the rejection. The contractor then has five (5) business days to serve a supplemental offer on the claimant after having taken the claimant’s basis for rejection into consideration. Again, the claimant may elect to accept or reject this offer, having an additional fifteen (15) business days to tender notice should they choose the latter option. Only after rejection of the supplemental offer may the homeowner commence legal action.
However, if a contractor or supplier provides a written statement rejecting the homeowners claim, or fails to respond to the homeowners claim within the statutorily proscribed fifteen days, the homeowner may then commence legal action without further notice or delay.
This process becomes complicated even further if the homeowner, contractor, or supplier reached an agreement regarding a warranty of products or services at the time of contract. Contractors also have the ability to implead subcontractors and materials suppliers into the claim if they believe their conduct contributed in any way to the alleged defect.
Filing a claim for construction defects in compliance with Wisconsin’s Right to Cure Act is an extremely nuanced and deadline-driven process. Failure to adhere to the statutory requirements could result in outright dismissal of your claim. If you are a homeowner who believes that a general contractor, subcontractor, or materials supplier engaged in intentional, negligent, or reckless conduct which resulted in a material defect to your home, it is important that you seek the legal advice of an experienced attorney. John M. Kelly, Attorney at Law, LLC is home to over 42 years of experience handling construction law claims. Contact our office today for expert advice on Wisconsin’s Right to Cure Act and the steps you need to take in order to recover the maximum amount possible.