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THE SENATE |
S.B. NO. |
2607 |
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THIRTY-SECOND LEGISLATURE, 2024 |
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STATE OF HAWAII |
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A BILL FOR AN ACT
relating to construction.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. Section 672E-4, Hawaii Revised Statutes, is amended to read as follows:
"§672E-4 Rejection of claim; opportunity to repair
construction defect. (a) The contractor rejects a claimant's claim of
construction defects by:
(1) Serving the claimant with a written rejection
of the claim; or
(2) Failing to respond pursuant to subsection
(b)(1) or (b)(2), to the notice of claim within thirty days after service.
(b) The contractor, within thirty days after
service of the notice of claim, shall serve the claimant and any other
contractor that has received the notice of claim with a written response to the
alleged construction defect that:
(1) Offers to settle without inspecting the
construction defect by:
(A) Monetary payment;
(B) Making repairs; or
(C) Both subparagraphs (A) and (B); or
(2) Proposes to inspect the premises of the
alleged construction defect that is the subject of the claim.
(c) Within [thirty] fourteen days
following any proposal for inspection under subsection (b)(2), the claimant
shall [provide access to:] accept a contractor's proposal for
inspection and notify the contractor of the claimant's acceptance. After accepting the contractor's proposal to inspect,
the claimant and contractor shall agree on a time and date for the inspection,
which shall occur within thirty days of the claimant's acceptance of the
contractor's proposal to inspect, unless the claimant and contractor agree to a
later date. The claimant shall provide
reasonable access to the dwelling or premises during normal working hours for:
(1) [Inspect] Inspection of the
premises;
(2) [Document] Documentation of any
alleged construction defects; and
(3) [Perform] Performance of any
testing required to evaluate the nature, extent, and cause of the asserted
construction defect, and the nature and extent of any repair or replacement
that may be necessary to remedy the asserted construction defect;
provided that if the claimant is an
association under chapter 514B, the claimant shall have forty-five days to
provide [such] access. If access
to [an] individual condominium [unit] units is necessary,
and the association is unable to obtain [such] access, then the
association shall have a reasonable time to provide access. If destructive testing is required, the
contractor shall give advance notice of tests and return the premises to its
pre-testing condition. If inspection or
testing reveals a condition that requires additional testing to fully and
completely evaluate the nature, cause, and extent of the construction defect,
the contractor shall provide notice to the claimant of the need for additional
testing. The claimant shall provide
additional access to the dwelling or premises. If a claim is asserted on behalf of owners of
multiple dwellings, or multiple owners of units within a multi-family complex,
the contractor shall be entitled to inspect each of the dwellings or units.
(d) Within fourteen days following the inspection
and testing, the contractor shall serve on the claimant a written:
(1) Offer to fully or partially remedy the
construction defect at no cost to the claimant.
[Such] The offer shall include a description of
construction necessary to remedy the construction defect and a timetable for
the completion of the additional construction;
(2) Offer to settle the claim by monetary payment;
(3) Offer for a combination of repairs and
monetary payment; or
(4) Statement that the contractor will not proceed
further to remedy the construction defect.
(e) Upon receipt of an offer made under
subsection (b)(1), (d)(1), (d)(2), or (d)(3), and within thirty or forty-five
days, whichever applies pursuant to section 672E-5(a), the claimant shall
accept the offer and authorize the contractor to proceed with any repairs
offered under subsections (b)(1), (d)(1), or (d)(3).
(f) If a claimant unreasonably rejects a proposal
to inspect made under subsection (b)(2), or unreasonably rejects an offer under
subsections (b)(1), (d)(1), (d)(2), or (d)(3), the claimant shall not recover
an amount that exceeds the total value of the offer, calculated based on the
reasonable value of the repair, determined as of the date of the offer or the
amount of the offered monetary payment, or both.
(g) If a claimant unreasonably rejects a
contractor's proposal to inspect under subsection (b)(2), or unreasonably
rejects an offer under subsection (b)(1), (d)(1), (d)(2), or (d)(3), the court
shall deny the claimant an award of attorney's fees and costs regardless of
whether the claimant is determined to be the prevailing party for purposes of
the payment of attorney's fees and costs, and the contractor shall be entitled
to an award of attorney's fees and costs incurred following the date of the
offer.
(h) Any offer of settlement under this section
shall reference this section, and shall state that a claimant's failure to
respond with a written notice of acceptance or rejection within thirty or
forty-five days, whichever applies pursuant to section 672E-5(a), shall mean
that the offer is rejected[.] and subjects the claimant to the
limitations set forth in subsections (f) and (g). Failure to serve a written offer or statement
under this section shall be deemed a statement that the contractor will not
proceed further."
SECTION 2. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.
SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.
SECTION 4. This Act shall take effect upon its approval.
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INTRODUCED BY: |
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