239 Cal.App.4th 1132
Cal. Ct. App.2015Background
- Homeowners (Real Parties) owning 37 McMillin-built homes sued for construction defects alleging multiple common-law causes of action and originally a statutory SB 800 (Right to Repair Act) claim under Civil Code § 896.
- Homeowners did not provide the prelitigation SB 800 notice/repair opportunity before filing suit.
- Homeowners’ counsel dismissed the SB 800 cause of action (the third cause) and argued the remaining common-law claims permitted bypassing the Act’s prelitigation procedures.
- McMillin moved to stay the litigation under § 930(b) until homeowners complied with the Act’s nonadversarial notice-and-repair procedures; the trial court denied the stay relying on Liberty Mutual.
- McMillin petitioned for a writ of mandate; the Court of Appeal granted relief, concluding the Act applies to any action seeking recovery for damages arising out of residential construction deficiencies and therefore prelitigation procedures were required regardless of whether a statutory SB 800 cause of action was pleaded.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether homeowners who plead only common-law causes of action (after dismissing an express SB 800 claim) are exempt from SB 800 prelitigation procedures | Real Parties: Dismissal of the § 896 cause means the Act’s procedures do not apply; Liberty Mutual supports that common-law claims for actual damage lie outside SB 800 | McMillin: The Act applies to "any action seeking recovery of damages arising out of, or related to deficiencies in, the residential construction," so plaintiffs must comply with SB 800 prelitigation procedures regardless of the label of causes of action | The Act governs any action for damages arising from residential construction deficiencies; plaintiffs cannot evade its mandatory prelitigation procedures by pleading only common-law claims |
| Whether writ relief is appropriate to compel a stay pending prelitigation compliance | McMillin: Absent writ relief, the builder’s statutory right to an inspection/repair process would be lost and ordinary appeal would be inadequate | Real Parties: Issue moot because they offered a stipulation to stay if petition dismissed; trial court’s order reviewable on appeal | Writ relief granted: appeal would be inadequate and the issue is of recurring public importance; trial court ordered to vacate denial and stay the action until SB 800 procedures completed |
Key Cases Cited
- Aas v. Superior Court, 24 Cal.4th 627 (Cal. 2000) (held construction defects not causing actual damage were not actionable in tort under prior common law)
- Liberty Mutual Ins. Co. v. Brookfield Crystal Cove LLC, 219 Cal.App.4th 98 (Cal. Ct. App. 2013) (construed SB 800 not to be exclusive remedy for defects causing actual property damage)
- Verdugo v. Target Corp., 59 Cal.4th 312 (Cal. 2014) (statutory abrogation of common-law liability requires clear legislative intent)
- Baeza v. Superior Court, 201 Cal.App.4th 1214 (Cal. Ct. App. 2011) (discussed SB 800 prelitigation procedures)