CLIENT ALERT
In 2006, in Reddish v. Bowen, the MA appeals court affirmed a ruling that a home improvement contractor who installed an in-ground swimming pool within the side-yard setback, violated the Home Improvement Contract Law, M.G.L. c. 142A (“HIC”) and Chapter 93A, notwithstanding that the homeowner had represented that the pool location complied with zoning. The appeals court was not asked to rule on whether the trial court erred when it refused to allow the contractor to rely on a clause in its contract whereby the homeowner waived its right to assert a claim against the contractor if its representation as to zoning compliance was wrong. That issue was just decided, against the contractor, in Downey v. Chutehall Construction Co., Ltd.<spellcheck=”true” spellcheck=”true”>
Downey involved the replacement of a roof and roof deck on a Beacon Hill townhouse. The building code only allows two layers of roofing material. Chutehall claimed that Downey refused to allow it to strip off the existing roof notwithstanding its recommendation that it do so. Downey allegedly assured Chutehall that there was only one layer and, in reliance on this representation, Chutehall installed a new rubber membrane over the existing roof. A few years later, the Downeys sought to install new HVAC equipment on the roof. When the HVAC contractor cut through the roof membrane installed by Chutehall, he observed that there were four layers of roofing materials below, and leaks. The entire roof had to be stripped and replaced. The Downeys sued Chutehall for the costs incurred to replace the roof.
It is well established that a violation of the building code is a violation of the HIC statute. In turn, a violation of the HIC statute is a per se violation of the Consumer Protection Act, M.G.L. c. 93A which entitles the homeowner to potentially recover multiple damages and attorneys’ fees. There was no dispute that the four layers of roofing material was a building code violation and therefore, by definition, Chutehall violated both the HIC law and Chapter 93A. Chutehall argued, however, that because the homeowner refused to allow it to strip the roof despite its recommendation and affirmatively represented that there was only one layer below, the homeowner should not then be able to bring an action based upon its failure to remove the old roof. In other words, just as in Reddish, Chutehall argued that the homeowner, by its conduct, waived its right to sue. The trial court agreed, and the Downeys appealed.
In Downey, the appeals court framed the issue as to whether there could be an oral waiver of claims based upon the homeowner’s express representation upon which the contractor relied. The Downey court found that, on the facts of this case, there could be no waiver because the HIC law specifically prohibits any agreement with a homeowner which requires it to waive HIC rights. Moreover, because the purpose of the building code is to ensure public safety, if the court were to allow an oral waiver of building code violations, the purpose of the code would be frustrated and contractors would be encouraged to overlook code violations. Accordingly, the appeals court reversed the trial court and ruled that Chutehall had violated both the HIC law and Chapter 93A notwithstanding the conduct of the homeowner.
So, what does this mean for a home improvement contractor? You are the expert and are solely responsible for ensuring that your work complies with the building code regardless of what a homeowner may tell you. At least as to code violations, you rely on the homeowner at your own peril. If there is a code violation and the client does not want to pay for a proper fix, you should put the client on written notice that you cannot proceed. You may want to consider putting a clause in your HIC contract giving you the right to suspend or cease work if the homeowner does not cooperate in allowing you to ensure compliance with the applicable law. If you are relying on others’ plans, consider requesting indemnity for errors and omissions by whoever drew the plans. You cannot prevent the owner from suing you, but perhaps you can cover yourself through indemnity (though a court could say this is, in effect, an unenforceable waiver). We can help update your current contract. Future decisions will have to clarify whether Downey makes you, in effect, the guarantor of an architect’s improperly drawn plans. Talk to your insurance broker. Is there coverage you can buy to address this situation? Bottom line: taking a client’s word as to compliance with applicable laws is a risky proposition.
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John H. Perten is a shareholder at Sheehan Phinney Bass & Green PA. He is a member of the Business, Construction, and Litigation Groups. He may be reached at jperten@sheehan.com or 617.897.5641.
This article is intended to serve as a summary of the issues outlined herein. While it may include some general guidance, it is not intended as, nor is it a substitute for, legal advice.
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