Green Lawsuits: What They Could Mean for Home Builders

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LEED for Homes [1], the green home certification leg of the U.S. Green Building Council's [2] Leadership in Energy and Environmental Design program, was launched February of this year, eight years after the inception of the original. Because both LEED for Homes and its competitor, NAHB's [3] National Green Building Program [4], are less than a year old, builders can look to their friends in the non-residential construction sector for what they can expect from these certification programs and the publicity that surrounds them.

While the positives (i.e. good PR, tax breaks) are plentiful, there is one negative that can't be overlooked: lawsuits. They're already being filed by commercial building owners and developers who are unhappy when their touted and publicized green building doesn't ultimately live up to the hype. But what about in residential construction?

“Green litigation and insurance related settlements are already occurring,” says Brian D. Anderson, an attorney with Whyte Hirschboeck Dudek S.C. [5] in Madison, Wis., “but it's extremely difficult to quantify as most suits — green or not — most often settle out of court.”

Anderson cited one case in particular that his firm handled recently, in which a builder failed to obtain the promised level of certification for a home. “We were struggling to determine the value of the certification when the claim settled,” he explains.

So how do you avoid such lawsuits? Well, the obvious answer would be to deliver what you promise from the get-go. Anderson, however, advises clear communication between you and your client, as well as documentation of their expectations and strict attention to contract details.