TL;DR — Key Takeaways
- Many construction claims are won or lost before anyone files, through a notice that was never sent, sent late, or sent to the wrong place.
- Contracts frequently require written notice and an opportunity to cure before one party can terminate. Skipping that step can turn the other side’s breach into your own.
- For new homes covered by the Right to Repair Act, the homeowner must give the builder written notice and an opportunity to repair before suing. A builder that misses its response deadline can lose that protection.
- The ten-year statute of repose runs from substantial completion and is not extended by promises to fix the work.
- Evidence disappears fast on a construction site. Document before anything is repaired, removed, or covered.
- A demand letter is a tool, not an obligation. Sometimes the right first step is not a letter at all.
Before a California construction dispute reaches court, the parties usually have to give specific notices, observe contractual cure periods, and in some cases complete a statutory pre-litigation process, and the mistakes made at that stage often decide the case. Common ones include skipping a contractual notice-to-cure requirement before terminating, failing to follow the Right to Repair Act’s procedure for a new home, letting a deadline run while the other side promises to fix the work, and repairing or removing defective work before it is documented.
Contractual notice and cure
Most construction contracts, including the standard industry forms, require that before one party terminates for the other’s default, it give written notice and a stated period to cure.
The mistake. An owner frustrated with a slow or sloppy contractor fires them, changes the locks, and hires someone else, without sending the notice the contract requires. The contractor then sues for wrongful termination, and the owner discovers that the contract’s procedure was a condition of the right to terminate. An owner who could have terminated for cause may instead be found to have breached the contract, and may owe the contractor its lost profit on the unfinished work.
The fix is procedural. Read the termination and notice provisions before acting. Give notice in the form and to the address the contract requires, describe the default specifically, and allow the stated cure period to run. If the contractor cures, the dispute may be over. If it does not, the termination stands on firmer ground.
The same discipline applies to contractors. A contractor who stops work over late payment without following the statutory or contractual procedure for suspension exposes itself to a claim that it abandoned the job. California provides a specific statutory procedure for suspending work for nonpayment, and Bay Legal’s post on suspending work when an owner fails to pay covers it.
If you are about to terminate or suspend and have not checked the contract’s procedure, that is the moment to stop and check. Call Bay Legal at (650) 668-8000 in Northern California or (213) 668-8000 in Southern California.
Home improvement contracts and the right to cancel
For residential work, the pre-dispute notice obligations start before the job does.
California requires home improvement contracts to contain specified terms and disclosures, and gives homeowners a short statutory right to cancel certain contracts after signing. Since January 1, 2026, the contract must include an email address to which a notice of cancellation may be sent, and the homeowner may cancel by email as well as by mail or delivery.
The mistake on the contractor’s side is omitting a required term or the cancellation notice, which can extend the homeowner’s cancellation right and weaken the contractor’s position in a later dispute. The mistake on the homeowner’s side is not reading the contract before work starts, when the cancellation right and the dispute provisions are easiest to use.
The Right to Repair Act’s pre-litigation procedure
For newly built homes the Right to Repair Act covers, the homeowner must follow a statutory process before suing the builder. Does the Right to Repair Act apply to you covers which homes that is.
The process runs on deadlines, and most of the mistakes are about them:
- The homeowner’s notice. Written notice to the builder describing the claimed violation in reasonable detail, sufficient to determine its nature and location to the extent known. A vague notice invites a dispute about whether it triggered anything.
- The builder’s acknowledgment. The builder must acknowledge receipt in writing within 14 days.
- Inspection. The builder may inspect and test within a set period after acknowledging.
- The offer to repair. The builder may offer to repair, with a proposed completion date, within 30 days of the inspection, or may offer cash instead.
- The homeowner’s response. The homeowner has a set period to accept the offer or request alternative contractors.
- Repair. Repairs must begin promptly and be pursued with diligence.
Mistakes on the homeowner’s side. Suing without sending the notice, which allows the builder to have the case stayed until the process is completed. Sending a notice too vague to describe the problem. Refusing the builder access to inspect.
Mistakes on the builder’s side. Failing to acknowledge within 14 days. A California Court of Appeal held in 2017 that a builder that decides on its own that a notice is too vague, and simply does not respond, acts at its peril. When the builder misses a required step, the homeowner is released from the process and may proceed to court.
Associations of 20 or more units face an additional process, the Calderon procedure, before suing the builder. Who an HOA can sue for construction defects covers it.
When waiting costs you the claim
A costly pre-litigation mistake is the one that looks like patience.
The repose period. California bars claims for latent construction defects brought more than ten years after substantial completion of the work. It runs from completion, not from discovery, and the California Supreme Court has held that a contractor’s promises or attempts to repair do not extend it.
Shorter periods inside it. Patent defects carry a four-year period. Contract claims carry their own limitations periods. A homeowner who spends three years accepting assurances that the contractor will return can lose a contract claim that was strong on the merits.
Lien and payment deadlines. Contractors and suppliers face short statutory deadlines to record mechanics liens and to enforce them after recording. Owners face corresponding windows to respond. Those deadlines are measured in days and weeks, not years. Bay Legal’s Phase 1 construction content covers them.
The practical rule: a promise to fix the work is not an agreement to extend a deadline. If the deadline is approaching and the promise has not been kept, the options are a written tolling agreement signed by both sides, or filing. The practical deadline map covers the limitations periods.
Preserving evidence
Construction evidence has a short life. Walls get closed, damaged materials go to the dumpster, and the site changes every day.
Document before repair. Photograph and video the condition, with dates, before anything is opened, repaired, removed, or replaced. Where the problem is hidden, consider having it opened and documented by someone who can later explain what they saw.
Keep the paper. The contract and every change order, the plans and any revisions, permits and inspection records, invoices and proof of payment, daily logs, and every email and text with the other side.
Keep samples where it matters. Failed components, such as a leaking fitting or a section of failed waterproofing, can be decisive. Retain them rather than letting the repair contractor discard them.
Notify before destructive investigation. Where the other side may later be sued, giving it notice and an opportunity to observe before destructive testing avoids an argument that evidence was destroyed.
A homeowner who repairs everything first and investigates afterward may be left arguing about a defect nobody can now see.
When not to send the demand letter
Worth saying directly, given the title.
A demand letter is useful when it will produce something: a repair, a payment, a response that clarifies the other side’s position, or a record the case will later need. It is less useful, and sometimes harmful, where the relationship is still working and a phone call would resolve the issue; where a statutory notice is required and a generic demand letter might be mistaken for it or confuse the record; or where the letter commits you to a position before you have the facts, such as asserting a defect’s cause before anyone has investigated it.
The first step in a construction dispute is often not a letter. It is reading the contract, documenting the condition, and identifying which procedure and which deadline actually govern. The letter comes after that, written to fit.
Bay Legal represents owners and contractors in construction disputes from the first notice. Reach us at (650) 668-8000, (213) 668-8000, or through baylegal.com/contact-us.
Frequently Asked Questions
What notices must be given before a California construction claim is filed?
It depends on the contract and the type of project. Many contracts require written notice and an opportunity to cure before termination. For newly built homes covered by the Right to Repair Act, the homeowner must give the builder written notice and an opportunity to repair before suing. Associations of 20 or more units must complete the Calderon process before suing the builder.
How does a defective or missing cure notice damage a claim?
Where the contract makes notice and an opportunity to cure a condition of termination, terminating without it can turn the other party’s breach into your own. An owner who fires a contractor without the required notice may be found to have wrongfully terminated and may owe the contractor its lost profit.
What does SB 800 require before a residential defect suit?
Written notice to the builder describing the claimed violation in reasonable detail, the builder’s written acknowledgment within 14 days, an opportunity for the builder to inspect and to offer to repair, and the homeowner’s response to that offer. A builder that misses a required step can lose the procedure’s protection, and a homeowner who sues without it can have the case stayed.
What records should be preserved at the first sign of a dispute?
Photographs and video of the condition before any repair, the contract and all change orders, plans, permits and inspection records, invoices and proof of payment, daily logs, and all correspondence. Retain failed components where they may matter, and give the other side notice before destructive investigation.
When does waiting cost you the claim?
When a deadline runs while you wait. The ten-year repose for latent defects runs from substantial completion and is not extended by repair promises; patent defects and contract claims carry shorter periods; and lien deadlines run in days and weeks. If a promise has not been kept and a deadline is near, obtain a written tolling agreement or file.
