| 47 | | - | 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 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 may accept the offer and authorize the contractor to proceed with any repairs offered under subsection (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 subsection (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 on July 1, 2040. |
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| 47 | + | 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. INTRODUCED BY: _____________________________ |
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