Minnesota Passes NOR Law

In May Minnesota passed a law designed to protect both homebuilders and homeowners in the event that a building defect is discovered. The Minnesota notice and opportunity to repair (NOR) law, like similar NOR laws in 30 other states, gives the builder the opportunity to inspect the alleged defect and possibly repair the problem, rather than taking the matter immediately to court.

The law states that the homeowner "must allow an inspection and opportunity to offer to repair the known loss or damage." The inspection must be performed, and any offer to repair must be made, in writing to the homeowner within 30 days of the builder's receipt of the NOR. Upon completion of repairs, the builder must provide the homeowner with a list of the repairs made and a notice that the homeowner may have a right to pursue a warranty claim.

In addition, a subdivision of the law says that warranties are not affected by the dissolution of the building company. The law also states that "the bankruptcy, insolvency or dissolution of the insured shall not relieve the insurer of any of its obligations under this policy"-meaning that even if the builder is out of business, the insurance company is subject to warranty claims from homeowners. This provision means that homeowners will still have some legal recourse. Builders in Minnesota are required to carry insurance, in order to obtain a license.

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