2008 Ballot Propositions Transcript

PROPOSITION 201, HOMEOWNERS' BILL OF RIGHTS:

Secretary Brewer Explanation of a Yes and No Vote

SECRETARY JAN BREWER: A yes vote shall have the effect of granting prospective buyers a right to sue over dwelling actions, permitting lawsuits despite alternative dispute resolution provisions in sales contracts, shortening a buyer's purchaser notice and seller's response period before and after filing a defect lawsuit. Requiring sellers to inspect dwelling after receiving notice. Requiring any seller offer to include a repair or replace option that must be performed before a licensed contractor. Eliminating the seller's right to receive attorney's fees and costs if the seller prevails. Mandating seller to provide 10-year warranty of materials and workmanship. Requiring newly-constructed dwelling contract to include disclosure of seller's financial relationship with the financial institution. Disallowing sellers from requiring a buyer deposit unless contact allows a hundred-day cancellation period. Extending from eight to 10 years the time to file suit against any person making improvements to real property. And expanding remedies available to an owner who is successful in a dwelling action against the seller.

A no vote shall have the effect of retaining the current law regarding purchaser dwelling actions.

Argument For Proposition 201

MR. EDWARD ARMOUR: Thank you. Shouldn't your home warranty be longer than your car's warranty? When I was a young man, my father used a word I hated, "responsibility." Sadly, today, there are many promises made and broken. Thousands of your neighbors have had real problems whitewashed and the underlying cause of construction defects spackled. Arizonans are losing weeks of pay waiting for builders to show up at their door, losing thousands of dollars having to pay for attorneys, just to convince the builders that their problem is real.

It began when the builder's lobbyist convinced the legislature to strip homeowners of any substantial remedies. 201 restores some of the balance, and at last polling, almost a full 80 percent of Arizonans supported our practical measure to restore your rights. It preserves arbitration and mediation agreements as a way to solve disputes. After all, no defects means no lawsuits of any kind.

Our opponents are the home builders who have thrived for our entire lives, but up until now would have you believe that 201 is a weapon of mass destruction that will encourage responsible behavior. Serious construction defects wreak economic mass destruction on families. Even after repairs, they are often left with a defective home they can't get fully fixed and they can't sell.

These days, large corporations have to be bailed out, costing us trillions of dollars with no responsibility for the role they played in the crisis. Almost 30 percent of the homes built in Arizona are built by similar corporations.

I ask you to do what my father asked me. Teach accountability. Hold builders responsible if they build a bad home. The only question is now, will you vote to protect Arizona families or to protect irresponsible builders? I urge you to vote yes on Prop 201. Find out more at voteyesonprop201.com. Thank you.

Argument Against Proposition 201

MR. GRANT WOODS: Hi. Well, I'm not a home builder. I was the Attorney General for the State of Arizona from 1991 to 1999. I spent all of my time fighting for consumers. As a lawyer, I'm in court fighting for Plaintiffs. And I'm opposed to Prop 201. I think it's a bad idea. Well, how could that be? Why? Really, it's deceptive. This isn't about homeowners' rights. What it's about is really full employment for out-of-state trial lawyers. And I'm a trial lawyer, but I hate frivolous lawsuits.

What this thing does that they've come up with is crafted by an out-of-state California lawyer. It's kind of a cottage industry over there. What it does is it eliminates, for all intents and purposes, our mediation process here in Arizona. We're trying to get rid of frivolous lawsuits. We're trying to move people to mediation to actually solve problems, rather than just have the lawyers and the courts involved at all times. This eliminates that. Why? Only because it's written by trial lawyers for trial lawyers.

It's unfair. It ensures that everything is going to go to court, and it forbids the Defendant from recovering attorney's fees. Why would that be? It's unnecessary. Arizona's law is really a model. We got everybody together, the Governor was involved, the legislature was involved, all the interest holders were involved, and we came up with a really good mediation process. We don't need to get rid of it.

Proponents of 201 are primarily big labor, and their funding comes 99 percent from out-of-state interests. It goes too far. Perspective homebuyers, under 201, can sue. You don't even have to own a home to file a lawsuit that you've been damaged.

Now, I'm against frivolous lawsuits. This is a welcome mat to California lawyers to come over here and do what they've done there, and that is file frivolous lawsuits and try to extort some money out of people. It doesn't benefit consumers, it's just wrong.

By the way, home builders under this won't even be able to fix problems if they want to. So take a look at www.stoplawsuitabuse.com. Join with me for consumers, vote no on Prop 201.

Questions and Answers for Proposition 201

MODERATOR CAREY PFEFFER: A question for Proposition 201 comes from Monica. She asks: My house was built in 1975. If I want to sell my house, do I have to provide a 10-year warranty to the buyer? And I assume that means if this were to pass, would I then need to provide a 10-year warranty to the buyer? So, this is someone who has a home that was built years ago. What would be the impact?

MR. MIKE BRAUN: Carey, the current law and the Proposition 201 text, even if adopted, does have a definition of "seller," and it's found on page 66 of the publicity pamphlet. "Seller" means a person or an entity that is in the business of designing, constructing, or selling developments. So, if that person who purchased her home in 1975 is in the business of selling, arguably, she'd be covered. But it sounds like she's a personal homeowner who would not meet the definition of "seller" in the existing or amended law.

MODERATOR CAREY PFEFFER: A question from Brad, and this deals with Proposition 201, the Homeowner's Bill of Rights. If Proposition 201 passed, couldn't it increase the amount of lawsuits that are filed in the courts? Question from Brad: If 201 passes, could it increase the amount of lawsuits that are filed in the courts? 201 again is the Homeowner's Bill of Rights. We're going to probably need to let our experts sort of make sure that they -- because we'll be jumping around from one item to another, so there may be an occasional pause while they check on background information.

MR. JOSEPH KANEFIELD: The question is: Will the number of lawsuits increase if Proposition 201 is passed? Obviously, that's speculation, and I can't say one way or the other. Let me just say that if this measure passes, a home purchaser will have the right to bring a lawsuit against a home seller. Although, if the parties agree to arbitration or mediation, they can still engage in that process even if this measure passes.

MODERATOR CAREY PFEFFER: A question from Josh on Proposition 201, the Homeowner's Bill of Rights: What are the alternative dispute resolution provisions? It's written under "yes" on page 76 of the -- of the "voter guide." It refers to alternative dispute resolution provisions. And what Josh is asking is, what -- what are those? Or what might be an example or examples of what that's about? Again, that's on -- if you need a specific reference, on page 76.

MR. MIKE BRAUN: Carey, I think the best way to answer that is to actually refer to page 68 of the pamphlet. Under the existing purchaser dwelling law, the -- all of the provisions of the existing law do not apply if the contract for the new home contains commercially reasonable alternative dispute resolution procedures, things like mediation or arbitration. So, if a contract contains those reasonable provisions, then all of the other procedures that are set out in statute do not apply.

This measure would repeal that exception, so that even if the contract contained commercially reasonable alternative dispute resolution procedures, a purchaser would be allowed to go through the regular court system and not have to follow those procedures.