Ohio Ct Stays Homeowners’ Class Action Lawsuit and Orders Arbitration of Construction Defect Claims

Ohio Appellate Court decision (June 18, 2015)

Homeowners filed a class action lawsuit against a builder seeking damages for alleged design defects in their homes relating to the roofing systems. The homeowners contended that the defects resulted in serious water intrusion, structural damage to their homes and consequential black mold growth. The builder sought a stay of the class action lawsuit pending arbitration in accordance with provisions that were contained in the purchase agreement and the limited warranty provisions contained therein  which required claims to be submitted to binding arbitration. The homeowners sought to prevent arbitration of their claims on the basis that: (i) the warranty provisions in the contract documents were both substantively and procedurally unconscionable; and (ii) their claims were not subject to arbitration.