The Home Construction Services Act was passed in 2012 as a means to provide relief for certain home construction-related contracts and projects, and to create an exception to the Ohio Consumer Sales Practices Act, which, with its treble damage provisions, can present a significant challenge on larger dollar projects. However, due to some of the vagaries in its language and sparse case law interpreting the Act, it really spent most of its first decade in existence flying under the radar. Then, as case law developed, multiple decisions held that the Home Construction Services Act only applied to new construction. Recently, however, the Legislature responded to these decisions by modifying the language in the Home Construction Services Act, thereby removing any doubt that the Act indeed applies to remodeling. This means that it is imperative for all remodelers engaging with consumers to have their forms reviewed to ensure they are compliant with the Home Construction Services Act (HCSA).
Compliant contracts are going to require certain specific provisions, including: 1) that the contract between the remodeler and the customer for any project in excess of $25,000 be in writing; 2) that the written contract contain the supplier’s name, physical business address, business telephone number and taxpayer identification number; and 3) the owner’s name, address, and telephone number, in addition to the address or location where the project is being performed. There must be a description of the services being provided, along with an anticipated start and completion date or time period for the construction. The Act also has a limitation on the amount of a down payment that a contractor can take before commencing performance.
For contracts that violate the Act, the owner’s remedies may include rescission or damages, including up to $5,000 in non-economic damages, as would be available under the Consumer Sales Practices Act. Additionally, the prevailing party may recover their reasonable attorney’s fees.
And while the Act imposes all these technical requirements, it also has substantive provisions and prohibitions concerning unworkmanlike performance, failure to make certain disclosures, and misleading representations.
For all these reasons, there is too much at stake for a remodeler not to have their contract reviewed by an attorney to ensure that they are availing themselves of an exception to the Consumer Sales Practices Act and minimizing any potential exposure under the Home Construction Services Act.
If you have any questions concerning the content of this article, or have a contract that has not been reviewed or updated in some time, please contact this author at: msandner@pselaw.com or 937.223.1130.
