Mcmillin Albany LLC v. Superior Court Of Kern County

4 Cal. 5th 241, 408 P.3d 797 (2018)

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Nature of the Case

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Facts

The Legislature passed comprehensive construction defect litigation reform. The Right to Repair Act (Act) sets forth detailed statewide standards that the components of a dwelling must satisfy. It also establishes a prelitigation dispute resolution process that affords builders notice of alleged construction defects and the opportunity to cure such defects, while granting homeowners the right to sue for deficiencies even in the absence of property damage or personal injury. Carl and Sandra Van Tassel (Ps) and several dozen other homeowners purchased 37 new single-family homes from developer and general contractor McMillin Albany LLC (D) at various times after January 2003. Ps sued D, alleging the homes were defective in nearly every aspect of their construction, including the foundations, plumbing, electrical systems, roofs, windows, floors, and chimneys. The operative first amended complaint included common law claims for negligence, strict product liability, breach of contract, and breach of warranty, and a statutory claim for violation of the construction standards set forth in section 896. D sought to invoke the Act. The Act regulates the procedures for any repair, authorizes mediation, and preserves the homeowner's right to sue in the event the repair is unsatisfactory and no settlement can be reached. Ps dismissed their section 896 claim. D moved for a court-ordered stay. Ps claim that the Act was adopted to provide a remedy for construction defects causing only economic loss and did not alter preexisting common law remedies in cases where actual property damage or personal injuries resulted. The trial court denied the motion for a stay. The trial court certified the issue as one worthy of immediate review. The Court of Appeal granted D's and issued the writ. It held that the text and history of the Act was meant to at least partially supplant common law remedies in cases where property damage had occurred. The Court of Appeal held the Act's prelitigation resolution process applied here even though Ps had dismissed their statutory claim under the Act. The court concluded that D is entitled to a stay pending completion of the prelitigation process. Ps appealed.