John and Stacy recently built a house in Princeton, New Jersey. The homeowners noticed a few flaws with the house shortly after moving in; however, it was not until 10 months later that they began to note numerous deficiencies with the home. The deficiencies included: cracks in the driveway, the sprinkler system did not work, interior paint was peeling, plumbing fixtures were defective, and several electrical outlets did not work.

The homeowners contacted their warranty provider regarding the concerns they had with their home. The warranty provider administers the private new home warranty security plan that was provided at the closing. The homeowners were notified that they needed to submit a letter in writing to the builder outlining their concerns and their request for resolution.

They submitted a letter to the builder with their concerns; however, upon discussing the issues, the homeowner and builder could not reach a satisfactory resolution. Therefore, the homeowners contacted the warranty provider and notified them of the builder’s response.

At this point the warranty provider contacted both the homeowner and the builder with hopes of mediating the complaint to a resolution. After several unsuccessful attempts at resolution, the warranty provider notified the homeowner of their right to request the case be sent to arbitration. The homeowners decided this would be their best option and submitted the application for arbitration.

The warranty provider received the request for arbitration and assigned the case to DeMars & Associates, Ltd. (DMA). DMA is an independent third party neutral who is responsible for the recruitment and training of arbitrators. In addition, DMA applies the rules set forth in the Consumer Arbitration Program Rules For Home Warranty Disputes.

DMA appointed an arbitrator from its pool who was knowledgeable in residential construction. DMA then contacted all parties involved in the case to set up a date and time for the arbitration hearing to occur.

Ten days prior to the hearing, DMA provided all parties with copies of written evidence as well as a reminder of the hearing date and time. The arbitrator met with the parties at the housing site and reviewed the concerns that were reported. At the close of the hearing the arbitrator notified all parties that they would receive a statement of their findings within 14 days from that date.

Following the hearing, the arbitrator typed up the findings and submitted them to DMA. In this case, the arbitrator decided that the cracks in the driveway, interior paint peeling, plumbing fixtures, and electrical outlets represented deficiencies and were the builder’s responsibility. However, the sprinkler system was not covered under the terms of the warranty.

DMA put the decision in letter form and sent it to the arbitrator for review and signature. The final decision letter was then sent to all parties.