10 TAC §§313.2, 313.5 - 313.9, 313.11, 313.13, 313.15 - 313.21
The Texas Residential Construction Commission (commission)
proposes amendments to §§313.2, 313.5 - 313.9, 313.11, 313.13, 313.15
- 313.21 of 10 TAC Chapter 313, regarding the State-sponsored Inspection and
Dispute Resolution Process (SIRP).
Generally, the proposed amendments clarify the procedures for participation
in the SIRP. The proposed amendments to §313.2, Prerequisite to State-sponsored
Inspection and Dispute Resolution Process (SIRP), better describes the actions
that the commission may take if a homeowner fails to provide thirty days notice
to a builder of alleged defects prior to filing a request for the SIRP.
The proposed amendments to §§313.5, 313.6, 313.8 and 313.15 clarify
the meaning of the adopted rules. The proposed amendment to §313.7 better
explains the items that a requestor must submit with the request and information
that a recipient of notice of a request must submit to the commission. The
proposed amendment to §313.9 describes the procedure for withdrawal if
a requestor fails to timely provide information to complete a request to participate
in the SIRP.
The proposed amendments to §313.16 and §313.17 more fully describe
the commission’s expectations regarding the third-party inspector’s
duties to complete the report, revise the report or re-inspect an alleged
defect on remand.
The proposed amendments to §313.11 clarify the adopted rule, incorporate
language previously contained in §313.12, which the commission intends
to repeal upon the effective date of the adoption of changes to §313.11,
and provide a more comprehensive description of the process by which a qualified
third-party inspector is first identified by the commission, the strike period
that follows and the subsequent notice to the third-party inspector of the
appointment. The rule amendments also describe the third-party inspector’s
obligation to notify the commission of any potential conflict of interest
after the commission informs the inspector of the assignment. In addition,
the proposed amendments explain that during the strike period the parties
are not to initiate contact with the third-party inspector.
Proposed amendments to §313.13 better describe the third-party inspector’s
obligations to coordinate the date for the inspection with both parties and
the parties obligations to work cooperatively with the inspector to arrive
at a mutually agreeable time and date for the inspection and the third-party
inspector’s duties for the inspection report. In addition, the proposed
amendments incorporate portions of §313.14, which the commission intends
to repeal upon the effective date of the amendment of §313.13.
Proposed amendments to §313.18 clarify the commission’s delegation
of authority to the Executive Director to order a builder to reimburse SIRP
inspection fees if at least one alleged construction defect is affirmed. Further,
the amendments create a mechanism by which a builder can appeal the order
if the builder is able to show that he made an offer to make substantially
the same repairs as recommended by the final unappealable report issued by
the commission. In addition, the proposed amendments make clear that the commission
will reimburse any homeowner who pays a fee to initiate an SIRP if a final
unappealable report issued by the commission affirms at least one alleged
construction defect.
Proposed amendments to §§313.19, 313.20 and 313.21 clarify the
appeal process and the obligations of the appeal panel regarding the appeal
and the third-party inspector regarding any matter remanded to him after an
appeal.
Ms. Susan Durso, General Counsel for the commission, has determined that
for each year of the first five-year period that the proposed amended rules
are in effect there will be no increase in expenditures or revenue for state
government and no fiscal impact for state or local government as a result
of enforcing or administering the section.
Ms. Durso has also determined that for the first five years the amended
rules are in effect the public will benefit from more clear and precise rules
that explain how to participate in the SIRP process. There will not be an
effect on individuals, or large, small or micro businesses. There is no anticipated
economic cost to persons who are required to comply with the proposed amendments.
Ms. Durso has also determined that for each year of the first five-year
period the proposed amended rules are in effect there should be no effect
on a local economy; therefore, no local employment impact statement is required
under the Administrative Procedure Act, §2001.022.
Comments on the proposed amendments may be submitted to Susan K. Durso,
General Counsel, Texas Residential Construction Commission, 311 E. 14th Street,
Austin, Texas 78701 or by fax to (512) 475-2453. Comments may also be submitted
electronically to susan.durso@trcc.state.tx.us. For comments submitted electronically,
please include "Amended SIRP Rules" in the subject line. The deadline for
submission of comments is thirty (30) days from the date of publication of
the proposed rules in the
Texas Register
.
Comments should be organized in a manner consistent with the organization
of the rule under consideration.
The amendments are proposed pursuant to Property Code §408.001,
which provides general authority for the commission to adopt rules necessary
for the implementation of Title 16 and Subtitle D of Title 16 of the Property
Code, which provides for the implementation of the SIRP and Property Code
§§27.001 - 27.004 to the extent that those sections relate to Title
16 Subtitle D of the Property Code.
The amendments are proposed to implement Property Code §408.001 and
§426.004.
§313.2.Prerequisite to State-sponsored Inspection and Dispute Resolution Process (SIRP).
(a)
Before a homeowner may file a request to initiate the SIRP,
a homeowner must give the builder a 30-day written notice of any claimed construction
defect(s).
(b)
After notice has been provided to the builder as required
in §313.2(a), the homeowner must also provide the builder, or its designated
consultants, a reasonable opportunity to inspect the affected home if the
builder requests such an opportunity.
(c)
If a homeowner contacts the commission to initiate the
SIRP before the homeowner has provided the builder with the required written
notice and the inspection opportunity, the homeowner will be provided with
the requirements and the procedures for filing a request to initiate the SIRP,
and instructions on the procedure to initiate the SIRP if the dispute remains
unresolved.
(d)
If the homeowner has failed
to provide thirty days notice for every item listed in a SIRP request, the
commission will:
(1)
exclude the item from the list of alleged defects
to be inspected; or
(2)
at the homeowner’s request, hold the SIRP
until the builder has had the requisite thirty days notice for all alleged
items to be inspected; or
(3)
allow the builder to waive the requisite notice
under this section if the builder agrees in writing that the inspector can
inspect and report on alleged defects for which the builder did not receive
thirty days notice before moving forward with the SIRP requested inspection
of those items.
§313.5.Filing a Request to Initiate the SIRP.
(a)
Either the homeowner or the builder may initiate the SIRP
by filing a request with the commission.
(b)
If the affected home is not registered with the commission
at the time the request is filed, the requesting party must also register
the home with the commission by submitting a commission-prescribed home registration
form and the appropriate fee. A builder who failed to register the affected
home in accordance with Chapter 303, Registration of Homes, shall reimburse
[
the homeowner
] the cost of the home registration fee
if paid
by the homeowner
.
(c)
When a person contacts the commission to initiate the SIRP,
the commission will provide the person with information necessary to file
a request, information on the applicable fees
to request
[
for
] a third-party inspection, the registration status of the affected
home and instructions to register an unregistered home, if applicable.
§313.6.Information Required for the Request.
(a)
The request shall be submitted on a commission-prescribed
form and must include:
(1)
a description of the transaction giving rise to the dispute,
including,
(A)
the date on which the title transferred from the builder
to the initial homeowner, if the transaction giving rise to the dispute was
for new home construction on the builder’s property; or
(B)
the date on which the agreement describing the transaction
was signed or work commenced, whichever is earlier, if the transaction giving
rise to the dispute did not involve a title transfer, including new home construction
on the homeowner’s property, a material improvement to an existing home
or an improvement to the interior of an existing home when the cost of the
work exceeds $20,000.
(2)
credible documentation that establishes that the homeowner
provided the builder with or that the builder received written notice of the
alleged construction defect(s) at least thirty days prior to filing the request
if the request was initiated by the homeowner;
(3)
a general description of the builder’s response to
the homeowner’s notice of alleged construction defect(s) provided pursuant
to §313.2(a) of this chapter, and a copy of the written response, if
any;
(4)
a reasonably detailed description of the alleged construction
defect(s) included in
the
request;
(5)
a copy of any applicable written
warranty;
(6)
[
(5)
] an itemized list of all out-of-pocket
expenses and engineering or consulting fees incurred by the requestor in connection
with the alleged construction defect(s);
(7)
[
(6)
] a list of the names and addresses
of all professionals or other persons, known to the requestor
at the
time of the filing of the request
, who have inspected the alleged construction
defect(s) on behalf of the requestor; and
(8)
[
(7)
] any documents or other tangible
things that depict the nature and cause of the alleged construction defect(s)
and that depict the nature and extent of repairs necessary to remedy the construction
defect(s), including, expert reports, photographs, and videotapes, if these
documents and tangible things are either within the requestor’s physical
possession or if the requestor has the right to obtain the document or tangible
thing from a third party, such as an agent or a representative of the requestor.
(9)
[
(8)
]
A requestor is not required
to provide as a part of a SIRP request any of the following
[
The
following are excluded from the provisions of subsections (a)(6) and (a)(7)
of this section
]:
(A)
any documents or tangible things that were prepared or
developed in anticipation of litigation, for trial or for an arbitration proceeding
by the requestor’s attorneys or by the attorneys’ representatives
or agents for the requestor;
(B)
any documents or tangible things that reflect communications
between a requestor and the requestor’s attorneys or the attorneys’
representatives or agents on behalf of the requestor and that were made in
anticipation of litigation, for trial or for an arbitration proceeding; or
(C)
the name of any person who inspected the home on behalf
of the requestor in connection with the construction defect(s) alleged in
the request before the SIRP request was submitted to the commission, so long
as the requestor will not call upon this person as an expert witness or use
any of the materials prepared by this person during either the SIRP or any
action between the builder and the homeowner that arises out of an alleged
construction defect that is the subject of the request.
(b)
With regard to information provided under subsection
(a)(7)
[
(a)(6)
] and
(a)(8)
[
(a)(7)
],
a requestor who fails to submit the name of any person who inspected the home
on behalf of the requestor prior to the filing of a SIRP request in connection
with the alleged construction defect(s) may be prohibited from designating
that person as an expert witness and from using any materials prepared by
such person in the SIRP or any action arising out of any alleged construction
defect(s) that is the subject of the request.
§313.7.Notice of the Request.
(a)
The requestor shall send a copy of the request and
copies of
all information submitted
to the commission
along
with the request, by certified mail, return receipt requested, to all other
interested parties to the dispute.
(b)
A copy of the request and
the
submitted information
mailed to other interested parties
under subsection (a) of this section
must also be mailed to counsel for any interested party represented
by counsel, if
the identity of counsel is
known to the requestor.
(c)
An interested party who receives
a notice that a request has been submitted to the commission and who has information
pertaining to the determination of eligibility under §313.9 of this chapter
shall submit that information to the commission and provide a copy of the
information to the requestor within ten days of receiving a copy of the notice.
(d)
A homeowner is required to
request a SIRP prior to initiating an action for damages or other relief arising
from an alleged construction defect. If the commission determines that a civil
suit or an arbitration is pending between the homeowner and the builder for
relief arising from an alleged construction defect, the commission will not
proceed with a SIRP unless the commission determines that compliance with
Subtitle D of Title 16 of the Property Code is not required or receives an
order from the court or arbitration tribunal dismissing the action or abating
the action during the pendency of the SIRP.
§313.8. Fees for Filing Requests [ Inspection fee ].
(a)
The commission will establish
fees
[
a fee
] that
are
[
is
] commensurate with the scope of
the requested inspection and the type of construction defect(s) alleged [
and which is set at the lowest possible rate necessary to cover the cost associated
with the third-party inspection
].
(b)
The commission shall publish the established
fees
[
fee
] on its website and make
them
[
it
]
available to the public in writing.
(c)
The request to initiate the SIRP must include the appropriate
inspection fee.
(d)
A requestor who is able to show financial need may submit
a request for a reduction or waiver of the
required
[
inspection
] fee.
(1)
[
(e)
]The request for a reduction
or waiver of the
required
[
inspection
] fee must include
a sworn affidavit of inability to pay fees on a commission-prescribed form
at the time the request to initiate an SIRP is filed.
(2)
[
(f)
] The Executive Director shall
review any request for a fee reduction or waiver and the supporting affidavit
to determine whether to approve or deny the request.
(3)
[
(j)
] The Executive Director’s
decision on a request for fee reduction or waiver is a final agency decision
and is not subject to further administrative appeal.
(e)
[
(g)
] The Executive Director shall
approve a request to reduce or waive the inspection fee if the requestor:
(1)
has monthly financial obligations that amount to more than
40% of the requestor's gross monthly income, and;
(2)
does not have more than two months of net income in liquid
assets.
(f)
[
(h)
] If the Executive Director
approves a request to reduce or waive the inspection fee, the inspection fee
shall be reduced or waived based on the following schedule:
(1)
35% of the fee shall be waived if the requestor has monthly
financial obligations between 40.00% and 45.00% of the requestor's gross monthly
income.
(2)
70% of the fee shall be waived if the requestor has monthly
financial obligations between 45.01% and 49.99% of the requestor's gross monthly
income.
(3)
100% of the fee shall be waived if the requestor has monthly
financial obligations of 50% or more of the requestor's gross monthly income.
(g)
[
(i)
] The Executive Director may
grant exceptions to subsections
(e)
[
(g)
] and
(f)
[
(h)
] of this section upon a written showing of unique
need. Any exemption granted by the Executive Director to subsections
(e)
[
(g)
] and
(f)
[
(h)
] of this section
must be in writing.
§313.9.Initial Request Review.
(a)
Upon receipt of a request to initiate the SIRP, the commission
shall review the request
for eligibility
to determine if the request
contains information alleging or otherwise demonstrating:
(1)
that the dispute arises from a transaction governed by
the Act;
(2)
that the request is complete and includes the required
attachments and the payment of the appropriate fees;
(3)
that the affected home is registered with the commission;
(4)
that the alleged construction defect(s) were discovered
on or after September 1, 2003;
(5)
that the request is timely under §313.4 of this chapter;
and
(6)
that the request involves a dispute between a homeowner
and a builder regarding alleged construction defect(s) giving rise to a claim
that is not:
(A)
solely for personal injury, survival, wrongful death; or
(B)
solely for damage to goods not including damage to the
home; or
(C)
for an alleged violation of §27.01, Business &
Commerce Code, regarding Fraud in Real Estate and Stock Transactions; or
(D)
based solely on a builder’s wrongful abandonment
of an improvement project before completion; or
(E)
for an alleged violation of Property Code, Chapter 162,
regarding Construction Payments, Loan Receipts, and Misapplication of Trust
Funds.
(b)
If the commission determines that the request is not complete
or that the claim is not eligible for the SIRP, the commission shall notify
the requestor in writing and specify the reason(s) the request is not complete
or ineligible for the SIRP.
(c)
A requestor who has submitted an incomplete request will
be provided an opportunity to supplement the request to cure its deficiencies.
If a requestor fails to complete a request or to provide supplemental information
requested by the commission within ten business days after the commission
has made the request, the commission will administratively withdraw the request
and refund the fee paid to the requestor.
(d)
If the commission determines that the claim is ineligible
for the SIRP, the commission will
retain copies of all materials submitted,
return all
originally submitted
materials
to
[
submitted by
] the requestor and will refund any paid inspection fee.
§313.11.Appointment of Third-Party Inspector.
(a)
No later than fifteen days after the commission has determined
that the request to initiate SIRP is complete and that the dispute is eligible
for the SIRP, the commission shall
identify
[
appoint
]
a third-party inspector
for assignment
to conduct an inspection
and shall notify the requestor and respondent of the
identity of the
third-party inspector
[
appointment
] in writing.
(1)
Written notification under this subsection will be provided
by the most expedient and effective means
that is
available to
both parties, including facsimile or electronic transmission.
(2)
The commission, in its sole discretion, shall determine
the most expedient and effective means available to both parties for transmission
of the written notice of the appointment.
(b)
The commission shall
identify
[
appoint
] a qualified third-party inspector from the list of registered third-party
inspectors maintained by the commission. The inspector
identified
[
appointed
] shall be the next available inspector on the list of qualified
inspectors in the affected home’s geographic region.
(c)
Each party shall have one opportunity
to object to the third-party inspector identified, with or without cause.
The objection must be submitted to the commission in writing, by mail, facsimile
or electronic transmission within two business days of receipt of notice of
the third-party inspector.
(d)
Failure to timely notify the
commission of a party’s objection to the notice of third-party inspector
waives the party’s right to object, unless the party is able to establish
that newly-acquired material information has been found regarding a conflict
of interest that could not have reasonably been discovered prior to the expiration
of the objection period.
(e)
Following receipt of a party’s
objection, the commission shall identify the next available third-party inspector
from the list of registered third-party inspectors, and shall notify the interested
parties of the next qualified third-party inspector.
(f)
If the commission does not
receive a timely written objection to the third-party inspector notice, the
commission shall notice the third-party inspector of the SIRP appointment
and provide the inspector with the names of the interested parties and their
counsel, if any, and a copy of the SIRP request and other information provided
by the parties, if it relates to the inspection request.
(g)
After receipt of the appointment
notice under subsection (f) of this section, the third-party inspector shall
advise the commission of a conflict of interest with either of the parties
to the dispute or any other reason that the third-party inspector is unable
to accept the appointment.
(1)
If the third-party inspector advises the commission
of a conflict of interest that prevents him from accepting the assignment,
the inspector will return the material provided to the commission.
(2)
If the third-party inspector appointed is unable
to accept the appointment, the commission shall identify another qualified
third-party inspector and begin the process, again, as provided in this section.
(3)
If a third-party inspector declines an assignment
without an explanation that is satisfactory to the Executive Director on more
than three occasions, the commission may consider that information when determining
whether to continue offering assignments to the inspector and whether to renew
the third-party inspector’s registration under Chapter 303 of this title.
(h)
Until the commission has finally
appointed a third-party inspector and the appointed inspector has contacted
the parties to determine the date of the inspection, the parties shall not
initiate contact with the third-party inspector.
§313.13.Home Inspection and the Third-Party Inspector’s Report .
[
(a)
If the commission does not
receive a timely written objection to the appointed third-party inspector,
the commission shall contact the third-party inspector with information regarding
the dispute, including the names of the interested parties and their counsel,
if any. Unless the third-party inspector advises the commission of a conflict
of interest with either of the parties to the dispute, the commission shall
forward to the appointed third-party inspector a copy of the SIRP request
and all documentation submitted with the request.]
(a)
[
(b)
] As soon as practicable but
no later than two (2) business days after receipt of the SIRP request, the
appointed third-party inspector shall contact the homeowner to
ascertain
several dates and times that are
[
arrange a
] mutually convenient
to conduct an inspection of
[
time to inspect
] the affected
home. The third-party inspector shall
then make reasonable attempts to
contact
[
notify
] the builder
on regular business days
during regular business hours to determine whether the builder or a representative
is available to attend the inspection on one of the identified dates.
[
and the homeowner of the date and time of the inspection.
]
If the
builder affirms to the inspector that it would like to be present or to send
a representative, the third-party inspector shall make reasonable efforts
to work cooperatively with the builder and the homeowner to identify a mutually
convenient date and time to conduct the inspection. If either party to the
dispute fails to work cooperatively with the third-party inspector to arrange
a time and date for the inspection, the third-party inspector shall notify
the commission.
(b)
The homeowner and builder, including any of
their consultants or representatives, may be present at the inspection.
(c)
The third-party inspector shall gather all information
and other data that the third-party inspector, in the inspector’s sole
professional judgment, deems relevant to
conduct
the inspection
and write the inspection report
and shall gather
the information
[
it
] by any reasonable means including taking photographs
and measurements and interviewing the homeowner, the builder and any consultants
present
in order to document the inspection of the alleged defects
.
(d)
A third-party inspector may conduct interviews
at a later date or
[
An interview under this subsection may take
place
] outside the presence of others not aligned with the party subject
to the interview, if the third-party inspector in the inspector’s sole
discretion deems it preferable for the orderly conduct of the inspection.
(e)
[
(d)
] The third-party inspector may
suspend the inspection if a party interferes with the inspection in such a
manner as to prohibit the third-party inspector from performing the assigned
duties in an impartial and professional manner.
(f)
[
(e)
] The third-party inspector shall
not
independently
engage or employ the services of any testing
company or any consultant.
(g)
[
(f)
] Except as otherwise provided
under
§313.6(a)(9)
[
§313.6(a)(8)
], the builder
shall submit to the third-party inspector any documentation or tangible things
created or generated as a result of having received a notice of alleged construction
defect(s) under §313.2 of this chapter for consideration in the third-party
inspector’s report to the commission.
(h)
Either party may submit any
information that the party wants considered by the third-party inspector in
preparation of the inspection report to the inspector prior to the inspection
or within a reasonable time after the inspection such that the inspector has
an opportunity to review the information and timely submit the inspection
report to the commission. A party that provides information a third-party
inspector shall also provide a copy of the information to the other party
to the dispute and to the commission.
(i)
If the alleged construction
defect(s) described in the request do not include a structural matter, the
third-party inspector shall submit a report with recommendations to the commission
as soon as practicable after the inspection, but not later than the 12th day
after the date the third-party inspector receives the SIRP request and materials
submitted by the requestor from the commission, except as otherwise provided
by this chapter.
(j)
If the alleged construction
defect(s) described in the request involve a structural matter:
(1)
the third-party inspector shall inspect the
home as soon as practicable after receipt of the request from the commission,
but not later than the 12th day after the date the third-party inspector receives
the request and the requestor’s submitted materials from the commission;
and
(2)
the third-party inspector shall submit a report
after the inspection with recommendations to the commission as soon as practicable,
but not later than the 45th day after the date the third-party inspector receives
the request and materials submitted by the requestor from the commission,
except as otherwise provided by this chapter.
(k)
The third-party inspector’s
report shall:
(1)
set forth the inspector’s findings based
on applicable warranty and building and performance standards and shall include
the inspector’s recommendation for repairs, if any, as to whether each
alleged defect is in or out of compliance with the applicable standard;
(2)
identify the warranty and building and performance
standards upon which each finding is based; and,
(3)
include one or more reasonable repair or remediation
options to address the alleged construction defect(s) found.
(l)
A third-party inspector’s
report shall not include:
(1)
a recommendation for payment of monetary damages;
(2)
a price for the recommended repairs;
(3)
comments regarding matters outside the scope
of the SIRP and outside the scope of the third-party inspector’s duties
or
(4)
a determination of the value of any loss allegedly
suffered by the homeowner.
(5)
A third-party inspector’s report shall
not include findings or recommendations for repair for alleged construction
defects that are not listed in the SIRP or items that have been excluded by
the commission as ineligible for inspection unless both the homeowner and
builder agree in writing that the third-party inspector can include an inspection
of those items in the report or unless the third-party inspector observes
a construction defect that if left uncorrected immediately threatens the health
and safety of the occupants.
§313.15.Extension of Time.
(a)
[
A third-party inspector who conducts a structural
inspection may request from
]
The
[
the
] Executive
Director
may grant
an extension of time for a period of no longer
than five days for any deadline imposed on the third-party inspector under
§313.13
[
§313.14
] of this chapter
upon the
written request of a third-party inspector
(b)
[
A party to a dispute involving a claim related to
an alleged structural defect may request an extension of time from
]
The
[
the
] Executive Director
may grant an extension
of time
for any deadline imposed on the third-party inspector under
§313.13
[
§313.14
] of this chapter
upon receipt
of a written request from either party to the SIRP
.
(c)
The Executive Director shall grant an extension of time
requested under subsection (a) of this section upon a showing of that the
cause for the delay was not reasonably foreseeable by the third-party inspector
when the appointment was
accepted
[
made
].
(d)
The Executive Director shall grant an extension under subsection
(b) of this section as follows:
(1)
for
any reasonable period requested
[
a
period of no longer than five days
] without regard to cause if the parties
to the dispute agree to the extension in writing; or
(2)
for any reasonable period requested under the circumstances
upon a showing of good cause by the requesting party [
if the request
is made for an extension of greater than five days
]; or
(3)
[
upon a showing of good cause by the requesting party
] if the other party to the dispute does not agree to an extension.
(e)
The Executive Director’s decision on whether to grant
or deny an extension of time requested under this section is a final agency
decision not subject to further administrative appeal.
§313.16.[ Form of ] Third-party Inspector’s Report.
(a)
The third-party inspector’s report shall
be submitted to the commission on
the commission’s Third-Party
Inspection Report Form or in a format substantially similar to the commission’s
Third-Party Inspection Report Form, so long as the report includes all of
the information required by the commission’s Third-Party Inspection
Report Form
[
a commission-prescribed form
].
(b)
The commission shall return
any third-party inspector’s report that fails to provide the required
information or that includes findings, conclusions, comments or other information
outside the scope of the third-party inspector’s duties to the assigned
third-party inspector for revision.
(c)
If a third-party inspector
fails to revise a report returned for revision within a reasonable time after
notification of the need for revision, the commission may consider that failure
in making a determination whether the third-party inspector has fulfilled
his duties and is thus eligible for payment and in making a determination
as to whether to assign the third-party inspector to future SIRP requests
or to renew the third-party inspector’s registration under Chapter 303
of this title.
(d)
The third-party inspector shall
submit his completed report to the commission and the commission shall promptly
transmit the completed report, or revised report if required, to the homeowner
and the builder.
§313.17. Issues Remanded to the Third-party Inspector [ Delivery of Inspector’s Report ].
[
The third-party inspector shall submit his report to the commission
and the commission shall promptly transmit the report to the homeowner and
the builder.
]
(a)
If the appellate panel remands
an issue to the third-party inspector under §313.20 of this chapter,
the third-party inspector shall respond to the matter remanded as directed
by the appellate panel and file the third-party inspector’s report on
the remanded matter(s) with the commission within ten business days of receipt
of the appellate report.
(b)
If a third-party inspector
fails to timely file the report on remanded matters, the commission may consider
that failure in making a determination whether the third-party inspector has
fulfilled his duties and is thus eligible for payment and in making a determination
as to whether to assign the third-party inspector to future SIRP requests
or to renew the third-party inspector’s registration under Chapter 303
of this title.
(c)
Within three business days
of receipt of the third-party inspector’s report filed pursuant to subsection
(a) of this section, the Executive Director shall issue the report to the
parties.
(d)
A report issued on remanded
matters is subject to appeal pursuant to the provisions of §313.19 and
§313.20 of this chapter.
§313.18. Order for Reimbursement of Fees and Costs.
(a)
Upon issuance of a final unappealable report
in which the
[
If the third-party inspector’s
] findings
support all or a portion of the allegations of the requesting party
and the requesting party is the homeowner, the Executive Director shall issue
an order on behalf of the commission to the builder
[
the commission
may order the other party
] to reimburse [
all or part of
]
the fees [
or costs of inspection
] paid by the requestor
and
the costs of the inspection paid by the commission
.
(b)
A builder may appeal a notice
of the order to reimburse fees and costs under subsection (a) of this section.
(1)
To appeal the notice of order to reimburse fees,
the builder must file written notice of its appeal with the commission. The
commission will then set the appeal for a hearing with the State Office of
Administrative Hearings. The hearing will be conducted pursuant to commission
rules. In order to overcome the presumption that the builder must reimburse
the commission for the cost of the inspection and fees paid by the requestor,
the builder must demonstrate by credible evidence that the builder made a
written offer to the homeowner to repair, by the builder or a third-party,
all of the finally affirmed construction defects in substantially the same
manner as recommended in the commission’s final unappealable report,
prior to the submission of the SIRP request to the commission, that the homeowner
had notice of the offer and that offer was not accepted by the homeowner.
(2)
The notice of appeal must be received by the
commission within ten calendar days of the date that the commission notices
the builder of the obligation to reimburse the fees and costs under subsection
(a) of this section.
(3)
Notwithstanding a builder’s successful
appeal of an order to reimburse the commission for inspection fees under subsection
(b) of this section, the commission will reimburse the SIRP request fee to
any homeowner who initiates a request and pays the appropriate fee under §313.5
of this chapter if the final unappealable report issued by the commission
affirms at least one alleged construction defect.
§313.19.Time to Appeal of the Third-party Inspector’s Report.
(a)
A homeowner or builder may appeal the third-party inspector's
report and recommendation(s) on or before the 15th day after
the date
of the commission’s letter issuing the report to the parties
[
receipt of the report
].
(b)
A party to the dispute may request
in writing
an
extension of time to file a notice of appeal of the third-party inspector’s
report.
(1)
Upon a showing of good cause for an extension of time to
file a notice of appeal, the Executive Director may extend the deadline
for a reasonable time under the circumstances
[
by no more than
five days
].
(2)
The Executive Director’s determination of good cause
to grant or deny an extension of time under this subsection is a final agency
decision and is not subject to further administrative appeal.
§313.20.Appeal Process.
(a)
A
[
If a
] homeowner or builder
may appeal the standards applied to support findings or the reasonableness
of the repair
[
appeals the findings or
] recommendations in
a third-party inspector's report
.
[
,
]
(b)
Upon receipt of an appeal from either party,
the Executive Director shall refer the appeal to a three-person panel
of state inspectors. If the request involves a structural matter, one the
panel members shall be a licensed professional engineer.
(c)
[
(b)
] The appellate panel shall conduct
a review of the third-party inspector’s report and the written documents
and tangible things considered by the third-party inspector in making the
findings and recommendations, including but not limited to materials submitted
with the request, any information or data gathered by the third-party inspector
and documentation or tangible things provided to the third-party inspector
by one of the parties during the SIRP and prior to the issuance of the report.
(d)
Information submitted with
the appeal by either party that was not provided to the third-party inspector
to be available for his consideration when writing his report will not be
provided to or considered by the appellate panel.
(e)
[
(c)
] The appellate panel shall make
written findings of fact and shall recommend approval, rejection or modifications
to the findings and recommendations of the third-party inspector or shall
recommend that the matter be remanded to the third-party inspector for further
action as directed by the appellate panel.
(f)
[
(d)
] The appellate panel shall file
a written report of its findings and recommendations with the Executive Director
not later than the 25th day after the notice of appeal is filed with the commission.
(g)
[
(e)
] The Executive Director shall
transmit the appellate panel’s rulings to the parties to the appeal
not later than the fifth day after receipt of the appellate panel’s
rulings.
(h)
The Executive Director shall
return to the appointed third-party inspector for a response any issue remanded
by the appellate panel.
(i)
[
(f)
] A ruling by an appellate panel
under this section is a final agency decision not subject to further administrative
appeal.
§313.21.Offer to Repair After Issuance of a Final Unappealable Report .
(a)
Not later than the 15th day after
a SIRP report issued
by the commission has become final and unappealable,
[
the commission
has transmitted the third-party inspector’s report to the parties, or
if the third-party inspector’s report has been appealed, not later than
the 15th date following the date that the appellate panel’s ruling has
been transmitted to the parties
], a builder may make a written offer
of settlement to the homeowner to repair the alleged construction defect(s).
(b)
The offer must be sent by certified mail, return receipt
requested, to the homeowner at the homeowner’s last known address or
the homeowner’s attorney, if the homeowner is represented by counsel.
(c)
The offer may include either an agreement by the builder
to repair or to have repaired by an independent contractor, partially or totally
at the builder’s expense, or at a reduced rate to the homeowner, any
construction defect(s) included in the SIRP request.
(d)
The offer shall include in reasonable detail the repairs
to be made and shall provide that the repairs will be made within forty-five
days after the date the builder receives written notice of the homeowner’s
acceptance of the offer, except as delayed by the homeowner or by the occurrence
of events beyond the builder’s control.
This agency hereby certifies that the proposal has been reviewed
by legal counsel and found to be within the agency's legal authority to adopt.
Filed with the Office of
the Secretary of State on February 21, 2006.
TRD-200600910
Susan K. Durso
General Counsel
Texas Residential Construction Commission
Earliest possible date of adoption: April 9, 2006
For further information, please call: (512) 463-2886
10 TAC §313.12, §313.14
(Editor's note: The text of the following sections proposed for
repeal will not be published. The sections may be examined in the offices
of the Texas Residential Construction Commission or in the Texas Register
office, Room 245, James Earl Rudder Building, 1019 Brazos Street, Austin.)
Texas Residential Construction Commission (commission)
proposes the repeal of §313.12, Objection to the Third-Party Inspector
Appointed, and §313.14, The Third-Party Inspector’s Report, because
those provisions have been subsumed into the proposed amendments to §313.13
and §313.15, published contemporaneously in another section of this edition.
Ms. Susan Durso, General Counsel for the commission, has determined that
for each year of the first five-year period that the proposed repeals are
in effect there will be no increase in expenditures or revenue for state government
and no fiscal impact for state or local government as a result of enforcing
or administering the section.
Ms. Durso has also determined that for the first five years the rules are
repealed the public will benefit from more clear and precise rules that explain
how to participate in the SIRP process. There will not be an effect on individuals,
or large, small or micro businesses. There is no anticipated economic cost
to persons who are required to comply with the proposed repeals.
Ms. Durso has also determined that for each year of the first five-year
period the proposed repeals are in effect there should be no effect on a local
economy; therefore, no local employment impact statement is required under
the Administrative Procedure Act, §2001.022.
Comments on the proposed repeals may be submitted to Susan K. Durso, General
Counsel, Texas Residential Construction Commission, 311 E. 14th Street, Austin,
Texas 78701 or by fax to (512) 475-2453. Comments may also be submitted electronically
to susan.durso@trcc.state.tx.us. For comments submitted electronically, please
include "Repealed SIRP Rules" in the subject line. The deadline for submission
of comments is thirty (30) days from the date of publication of the proposed
rules in the
Texas Register
. Comments should
be organized in a manner consistent with the organization of the rule under
consideration.
The repeals are proposed pursuant to Property Code §408.001,
which provides general authority for the commission to adopt rules necessary
for the implementation of Title 16 and Subtitle D of Title 16 of the Property
Code, which provides for the implementation of the SIRP and Property Code
§§27.001 - 27.004 to the extent that those sections relate to Title
16 Subtitle D of the Property Code.
The repeals are proposed to implement Property Code §408.001 and §426.004.
§313.12.Objection to the Third-Party Inspector Appointed.
§313.14.The Third-Party Inspector’s Report.
This agency hereby certifies that the proposal has been
reviewed by legal counsel and found to be within the agency's legal authority
to adopt.
Filed with the Office of
the Secretary of State on February 21, 2006.
TRD-200600911
Susan K. Durso
General Counsel
Texas Residential Construction Commission
Earliest possible date of adoption: April 9, 2006
For further information, please call: (512) 463-2886