Homeowners fighting for right to sue

AUSTIN (KXAN) - Recent landslides in a neighborhood in San Antonio is spurring some homeowners to fight for more rights in Texas. Homeowners of Texas, Inc. said the Texas Legislature needs to pass a law that bans homebuilders from putting "compulsory arbitration" clauses in contracts.

"If [homeowners] have housing defects and they cannot be resolved and the builder won't fix them, they can't take them to court," said Tom Archer, the president of Homeowners of Texas. "They have to go to arbitration. That is a private justice system."

Archer helped get legislation passed in 2009 that eliminated an agency meant to deal with homeowner and homebuilder disputes. Homeowners were complaining the agency didn't look out for their interests. Now, Archer said he plans on getting a law passed that allows all homeowners to take thier builders to court.

"The homebuilders are going to be a lot more careful with the homes they build," he said. "Today they have no accountability."

But, homebuilders said arbritation agreements work best for both parties.

"What we've often seen is there is a splitting of the baby where both sides are given some," said Scott Norman, Jr., Executive Director of the Texas Association of Builders. "I have not seen any statistics that show homeowners are disproportionally affected in arbitration."

Norman also said a flood of court cases would automatically increase the price of homes in Texas.

"When you start adding costs, whether that be litigation costs or uncertainty about future litigation, that drives up the price of home ownership," he said. "Statistics say for every thousand dollars you raise the price of a home in Texas, over 27 thousand Texas families are priced out of the home."

For homeowners in a Hutto neighborhood that has been plagued with construction problems for years, arbitration has given them little recourse for reimbursement.

"The lawyers for the builders have it sewn up," said Michael Crump, an homeowner who has been fighting for his homebuilder to buy back his house. "If we were in court with a judge, it would be much more fair."

Crump bought his house in the Hutto Parke subdivision three years ago. After several homeowners started complaining of foundation problems and cracks throughout their houses, they started fighting for their money back.

"Some people just abandoned their homes and let them be foreclosed," said Natalie Crump, Michael's wife.

Homeowners near the landslides in San Antonio said their situation is even worse.

"The vast majority of the homes in the subdivision, the values of their homes have dropped precipitously because of this," said Archer.

Archer said he still needs to find sponsors for his legislation before it can be introduced at the State Capitol.