Got Water?

Got water?

Is your basement now an indoor wading pool, your driveway flooded, your cars soaked and stalled? Are you watching your property – and you – fall complacent victim to the ravages of this record-setting rainy summer season? More than in many years before, you are not alone in these tragic circumstances – neither property damage, nor in the subsequent uphill fight to regain what is rightfully yours as insured property owner and tax-paying citizen….

The heavy and constant rains we in the Midwest are experiencing have wreaked havoc on city streets, public spaces and properties throughout Indiana – and with more in the forecast, there appears to be no end in sight.  It is confirmed: July 2015 set rainfall records, supported by statistics that have been maintained since the mid-1800’s.

As you may have already and unfortunately learned, with all that rain and water comes damage.  Trees down.  Basements flooded.  Driveways and landscapes – your investments – washed away.  Power outages that destroy refrigerator and freezer contents.  The toll taken might be a cumulative destruction over weeks; it might have happened by flash flooding, in the space of a few hours.

To repair some of this damage — particularly the structural damage done to homes — many property owners will turn to their insurers for help.  Those insurers, in turn, will often make arrangements to involve contractors.  The contractors will likely ask you to sign a contract for the work to be performed.

If the work you are contracting for involves repairs to residential property, the contract you sign is governed by the Home Improvement Contracts Act (“HICA” or “the Act”).  Unfortunately, there are still many contractors, let alone homeowners, who are unaware of the existence and requirements of the Act.

It is important to keep in mind the remedial purpose of HICA and the fact that it provides homeowners with remedies not otherwise available at common law. The Act exists for the purpose of protecting consumers “by placing specific minimum requirements on the contents of home improvement contracts.” Homer v. J.M. Burman, 743 N.E. 2d 1144, 1148 (Ind. Ct. App. 2001). Contractors are held to a “strict standard” in order to effectuate the purpose of the Act. Mullis v. Brennan, 716 N.E.2d 58, 65 (Ind. Ct. App. 1999). As the Indiana Court of Appeals has said:

[F]ew consumers are knowledgeable about the home improvement industry or of the techniques that must be employed to produce a sound structure. The consumer’s reliance on the contractor coupled with the well-known abuses found in the home improvement injury served as an impetus for the passage of the Act, and contractors are therefore held to a strict standard.

Benge v. Miller, 855 N.E.2d 716, 720 (Ind. Ct. App. 2006) (emphasis added), citing Mullis, 716 N.E.2d at 65.

The Act applies to residential property. I.C. § 24-5-11-1. A “home improvement” under the Act is defined as “any alteration, repair, or other modification of residential property.” I.C. § 24-5-11-3. Significantly, the Act defines a “home improvement supplier” as a person, including a corporation, “who engages in or solicits home improvement contracts whether or not the person deals directly with the consumer.” I.C. § 24-5-11-6 (emphasis added). Anyone who chooses to engage in this conduct (soliciting) is by definition a “home improvement supplier” and is required to comply with the various provisions and protections of the Act. It is important to remember that the definition of “home improvement supplier” in I.C. § 24-5-11-6 does not require that the home improvement supplier deal directly with the consumer; a person who solicits the home improvement contract is covered by the Act “whether or not the person deals directly with the consumer.” Id.

The Act sets forth certain minimum requirements for home improvement contracts.  A contract lacking these requirements violates the Act and gives rise to certain remedies.  These remedies are critically important when the contractor fails to perform as promised.  The basic requirements are that each contract must contain:

(1) The name of the consumer and the address of the residential property that is the subject of the home improvement.

(2) The name and address of the home improvement supplier and each of the telephone numbers and names of any agent to whom consumer problems and inquiries can be directed.

(3) The date the home improvement contract was submitted to the consumer and any time limitation on the consumer’s acceptance of the home improvement contract.

(4) A reasonably detailed description of the proposed home improvements.

(5) If the description required by subdivision (4) does not include the specifications for the home improvement, a statement that the specifications will be provided to the consumer before commencing any work and that the home improvement contract is subject to the consumer’s separate written and dated approval of the specifications.

(6) The approximate starting and completion dates of the home improvements.

(7) A statement of any contingencies that would materially change the approximate completion date.

(8) The home improvement contract price.

(9) Signature lines for the home improvement supplier or the supplier’s agent and for each consumer who is to be a party to the home improvement contract with a legible printed or a typed version of that person’s name placed directly after or below the signature.

It is also important that the contract be written in a way that can be reasonably read and understood by the person or persons who sign it.

If you have questions about any home improvement contract with which you are presented you should seek legal advice.

Have You Been The Victim of a Flood Insurance Scam?

Flood insurance has been in the news again lately.  Just this past weekend CBS News’ “60 Minutes” aired a disturbing story, entitled The Storm After The Storm about homeowners having their flood damage claims denied on the basis of altered engineering reports.  The report raised serious questions about the conduct of Wright Flood (www.wrightflood.com), U.S. Forensic (www.usforensic.com) and GEB HiRise Engineering, whose offices were actually raided shortly before the report by the New York Attorney General’s office.  If you believe you have been the victim of inappropriate claim handling practices or fraudulent conduct by any of these companies or any other insurance companies or their vendors, you should contact an attorney to discuss your case.

Notwithstanding the bad faith practices of some insurance companies, flood insurance is critically important for many homeowners.  The Indiana Department of Insurance published this consumer alert back in February 2009, but the information is still valuable today.  Perhaps one of the most important tips for consumers about flood insurance is the waiting period.  Most policies will not take effect until 30 days after you purchase the insurance.  Planning ahead is key.