Colorado CDARA: A Plain-Language Guide for Homeowners and HOAs
When a Colorado homeowner or HOA board discovers a crack in the foundation, persistent water intrusion, or other signs of defective construction, the instinct is often to call the builder or go straight to a lawyer. But before any lawsuit can be filed, Colorado law requires property owners to complete a specific pre-litigation process under the Construction Defect Action Reform Act (CDARA). Understanding what that process involves, the notices, the deadlines, the inspections, and the options that follow, is the first step toward recovering the compensation your property may need. This CDARA Colorado guide walks through the full process in plain language.
At Elkus & Sisson, P.C., our Colorado construction defect attorneys guide property owners and HOA boards through every stage of the CDARA process, from preparing the Notice of Claim to evaluating inspection findings and responding to repair offers. When pre-suit steps do not produce an adequate resolution, we pursue the available legal remedies through litigation or arbitration.
What Is CDARA in Colorado?
The Colorado Construction Defect Action Reform Act (CDARA), codified at C.R.S. sections 13-20-801 through 13-20-808[1], is the primary statute governing how construction defect claims are handled in Colorado. The General Assembly enacted CDARA after finding that changes in construction defect law were necessary and appropriate, both to protect property owners and to prevent frivolous lawsuits against the construction industry.
CDARA establishes a mandatory pre-litigation process that all property owners must complete before filing a construction defect lawsuit. The statute applies to residential properties including single-family homes, condominiums, and townhomes, and to commercial properties. It governs claims involving structural defects, water intrusion, foundation failures, roofing defects, mechanical systems, and virtually every other category of construction problem.
Key objectives of CDARA:
- Require a structured notice-and-inspection process before litigation begins
- Give construction professionals a meaningful opportunity to inspect and repair defects
- Encourage early resolution of disputes without court proceedings
- Limit certain negligence claims and apply the economic loss rule to purely financial losses
- Balance homeowner and HOA rights against the interests of the construction industry
CDARA does not eliminate a property owner’s right to sue. It requires that the right to sue be preceded by a defined process, and that process creates a framework within which many construction defect disputes are actually resolved before reaching a courtroom. Legislative reference: Colorado General Assembly, SB24-106[3].
What Is the CDARA Notice of Claim Process?
The Notice of Claim (NOC) is the first and most critical step in the CDARA pre-litigation process. Under C.R.S. section 13-20-803.5[2], a property owner must serve written notice on all construction professionals they intend to name in a lawsuit before filing any legal action. The notice must be served at least 75 days before filing in residential cases, and at least 90 days before filing in commercial cases.
What the Notice of Claim must describe:
- The nature and location of each alleged construction defect
- How the defect has damaged the property or resulted in loss
- When the defect was first discovered
- Each construction professional whose work is alleged to have caused or contributed to the defect
Who must receive the Notice of Claim:
- General contractors who managed the construction
- Subcontractors whose scope of work is related to the alleged defect
- Architects, engineers, or designers involved in the work
- Material suppliers in certain circumstances
Failing to serve a proper Notice of Claim before filing suit can result in the court staying the lawsuit until CDARA procedures are completed. If permanent repairs are made before the construction professional has had an opportunity to inspect, the property owner may face spoliation of evidence issues that could damage their claim.
If you have already sent a Notice of Claim or received a response from a builder or contractor, consult an attorney before taking further steps. The timelines and response obligations under CDARA move quickly once notice is served. For a complete step-by-step walkthrough of how to prepare and serve a proper Notice of Claim, download the Colorado Notice of Claim: Checklist and Step-by-Step Guide.
After the Notice: The Inspection Window
After receiving the Notice of Claim, the construction professional has approximately 30 days to inspect the alleged defect and request additional documentation or testing. The property owner must provide reasonable access to the property during this window. If the construction professional wants third-party testing or destructive investigation, written agreement is required before proceeding.
The purpose of the inspection window is to give the construction professional a fair opportunity to evaluate the defect firsthand, not simply to accept or deny the claim based on paperwork. A thorough inspection conducted by a qualified expert is often the key to determining whether a viable claim exists and what repairs would actually cost.
After Inspection: The Repair or Settlement Offer Window
Following inspection, the construction professional has approximately 30 days in residential cases (and approximately 45 days in commercial cases) to make a written offer. The offer may propose:
- A specific remediation or repair plan, with a timeline and description of the scope of work
- A monetary settlement in lieu of repairs
- A combination of partial repairs and monetary compensation
If the property owner rejects the offer as inadequate, the construction professional may request mediation. If the offer is adequate and accepted, the construction professional proceeds with the remediation plan. If the construction professional declines to make an offer or fails to respond within the required window, the property owner may proceed to litigation or arbitration.
CDARA Timelines: Residential vs. Commercial Properties
CDARA applies to both residential and commercial properties, but the required notice and response timelines differ. Understanding which timeline applies to your property is essential for planning your claim.
| Stage | Residential | Commercial |
|---|---|---|
| Notice of Claim before filing | At least 75 days | At least 90 days |
| Inspection / testing window | Approx. 30 days after NOC | Approx. 30 days after NOC |
| Repair / settlement offer window | Approx. 30 days after inspection | Approx. 45 days after inspection |
| If unresolved | Litigation or arbitration | Litigation or arbitration |
Note: These windows represent the general statutory framework. Actual timelines in your case may vary based on the complexity of the defects, the number of parties involved, and the terms of any arbitration clause in your construction contract.
CDARA and HOA Construction Defect Claims
Homeowners associations occupy a distinct position under CDARA. An HOA that manages common elements such as exterior building envelopes, roofing systems, shared foundations, decks, hallways, and structural components typically has standing to bring a construction defect claim on behalf of its members for defects affecting those common areas.
Key considerations for HOA boards pursuing CDARA claims:
- The HOA, not individual unit owners, typically sends the Notice of Claim for defects in common elements. Unit owners may have separate claims for defects inside their individual units.
- CDARA requires the HOA to serve notice on all construction professionals whose work is alleged to have contributed to common element defects. This often includes multiple contractors and subcontractors.
- HOA governing documents and Colorado statutes may impose procedural requirements before the board is authorized to initiate a construction defect claim. Board authorization, member notification requirements, and reserve analysis may all apply.
- In condominium communities, the coordinated nature of defects, where a single defect affects multiple units or the entire building envelope, often makes HOA-organized claims significantly more efficient and cost-effective than individual unit-owner actions.
- The statute of limitations and repose deadlines apply to HOA claims just as they apply to individual property owner claims. Delaying the Notice of Claim while internal deliberations continue can put claims at risk.
HOA boards facing construction defect issues in Denver metro communities should consult with a Colorado construction defect attorney before the board takes any formal action, sends any communications to builders or contractors, or authorizes repairs to common elements that may be subject to a defect claim.
Filing Deadlines for CDARA Claims
CDARA does not change Colorado’s underlying statutes of limitations for construction defect claims; it works alongside them. Colorado law generally provides a two-year statute of limitations from the date a defect is discovered or should have been discovered, and a six-year statute of repose measured from substantial completion of the construction. If a defect is discovered in the fifth or sixth year after completion, a two-year extension may be available, bringing the outer limit to eight years from substantial completion.
The practical effect of CDARA on these deadlines is significant: because the Notice of Claim must be served at least 75 days before filing suit, a homeowner approaching the statute of limitations must begin the CDARA process even earlier. Waiting to send notice until the last possible moment may leave insufficient time to complete the pre-suit process before the filing deadline expires.
Important deadline rule: Do not wait until you are certain a defect is actionable before starting the CDARA process. Once the statute of limitations expires, no Notice of Claim and no CDARA process can revive the right to file suit. If you suspect construction defects, consult an attorney early enough to preserve your options.
What Happens If CDARA Does Not Resolve the Dispute?
If the CDARA pre-suit process runs its course and the parties do not reach an agreement, the property owner is free to file a construction defect lawsuit. The path forward depends on the terms of the original construction contract and the nature of the claim.
- Litigation: If the construction contract does not require arbitration, the property owner may file suit in Colorado district court. Construction defect cases in court typically proceed through discovery, expert disclosure, and trial, a process that can take two to four years for complex defects involving multiple parties.
- Arbitration: Many construction contracts include mandatory arbitration clauses. If arbitration is required, the dispute is heard by a neutral arbitrator or panel rather than a judge and jury. Arbitration can be faster than court litigation but still typically takes one to two years for complex construction defect matters.
- What can be recovered: Whether in litigation or arbitration, property owners and HOAs may be able to recover the cost of repairs, diminution in property value, consequential damages such as water damage remediation and temporary relocation costs, and attorney fees where applicable under statute or contract. Recovery depends on which legal theories apply and the strength of the expert evidence supporting the claim.
Legal theories available after CDARA:
- Breach of contract or warranty
- Negligent construction or design
- Violations of applicable building codes
- Use of defective or nonconforming materials
- Failure to meet engineering or architectural standards
- Strict liability (in certain structural defect cases)
Evaluating Your Position Under CDARA
Understanding the CDARA framework is the first step, but knowing where you stand within it and whether the timeline still gives you viable options is what actually determines next steps.
- The Notice of Claim stage matters more than most homeowners realize. Most disputes do not settle at trial or arbitration. They settle during or shortly after the CDARA pre-suit process, when inspection results are fresh and the cost of litigation has not yet escalated. Missing the NOC window forfeits that opportunity.
- HOA boards face institutional inertia that individual owners do not. Boards often delay because internal approval processes take time. But statute of repose deadlines do not pause for board deliberations. Early legal consultation, before the board votes to act, protects the HOA’s timeline.
- The adequacy of a repair offer is a legal question, not just a practical one. A builder’s offer to repair may seem reasonable on its face while still being legally inadequate: incomplete, improperly scoped, or tied to conditions that waive future claims. Having an attorney evaluate the offer before acceptance is not optional for HOAs with fiduciary obligations to their members.
- The post-CDARA path determines which strategy to pursue. Whether litigation or arbitration follows a failed pre-suit process depends on contract terms set years before the defect appeared. Reviewing those terms early, rather than after receiving an inadequate offer, shapes the entire strategy.
For Colorado homeowners and HOA boards, the CDARA process is not a procedural formality. It is the legal foundation on which a construction defect recovery either gets built or gets foreclosed before litigation begins.
Frequently Asked Questions: Colorado CDARA
What is CDARA in Colorado?
CDARA is the Colorado Construction Defect Action Reform Act, codified at C.R.S. § 13-20-801 et seq. It is the primary statute governing construction defect claims in Colorado. CDARA establishes a mandatory pre-litigation process that requires property owners to serve a written Notice of Claim on all construction professionals they intend to sue, at least 75 days before filing a residential construction defect lawsuit, or at least 90 days before filing in a commercial case. The notice triggers a structured inspection and offer period during which the construction professional may inspect the defect and propose repairs or a monetary settlement. CDARA applies to virtually all types of construction defect claims, including structural defects, water intrusion, foundation failures, roofing defects, and mechanical system failures.
What is the CDARA notice of claim process?
The CDARA notice of claim process is a mandatory pre-suit sequence that begins when a property owner serves a written Notice of Claim on the construction professionals responsible for the alleged defects. The notice must describe the nature and location of each defect and the damages claimed. After receiving notice, the construction professional has approximately 30 days to inspect the alleged defects. Following inspection, the construction professional has approximately 30 days in residential cases, and approximately 45 days in commercial cases, to make a written offer of repair, monetary settlement, or combination of both. If the parties reach agreement, the construction professional proceeds with the remediation plan. If the parties do not reach agreement, the property owner may proceed to litigation or arbitration. Failing to complete this process before filing suit can result in the court staying the lawsuit.
How long does a CDARA case take?
The CDARA pre-litigation process itself typically takes three to five months from the date the Notice of Claim is served through the expiration of the repair offer window. That timeline extends when disputes arise over the scope of inspection or the adequacy of a repair offer, and extends further when multiple construction professionals are involved. If the pre-suit process does not resolve the dispute and the matter proceeds to litigation, construction defect cases in Colorado typically take one to three years or more to reach final resolution, depending on the complexity of the defects, the number of parties, and whether the dispute is resolved in court or arbitration. HOA cases involving common element defects and multiple unit owners often take longer due to coordination requirements and the scope of expert investigation.
Do I need a lawyer for a CDARA claim?
While CDARA does not require legal representation to serve a Notice of Claim, most property owners and virtually all HOA boards benefit from having an attorney involved before the notice is drafted and served. The Notice of Claim must be sufficiently specific to put each construction professional on notice of the alleged defects and the damages claimed. A notice that is vague or incomplete may not trigger the full protective value of the CDARA process. Beyond the notice itself, evaluating the adequacy of an inspection, assessing whether a repair offer is legally sufficient, and deciding whether to accept or reject an offer are all determinations with significant legal and financial consequences. For HOA boards, consulting an attorney before initiating any CDARA action also helps satisfy the board’s fiduciary obligations to its members.
Talk to a Colorado Construction Defect Attorney
Construction defect claims in Colorado can involve significant investment loss, lengthy pre-suit timelines, and disputes with contractors who are well-represented from day one. Elkus & Sisson, P.C. represents homeowners, HOAs, and contractors at our Colorado office locations in construction defect matters including CDARA notice of claim compliance, defect disputes, and HOA litigation.
If you have questions about the CDARA process or your construction defect claim, contact us or call +1 303-567-7981 to schedule a free consultation.
[1] Colorado Construction Defect Action Reform Act, C.R.S. sections 13-20-801 et seq., Colorado General Assembly |
https://leg.colorado.gov/sites/default/files/documents/2023A/bills/2023a_1255_enr.pdf
[2] CDARA Notice of Claim Requirements, C.R.S. section 13-20-803.5, Colorado General Assembly |
https://leg.colorado.gov/sites/default/files/images/olls/crs2023-title-13.pdf
[3] Colorado General Assembly, SB24-106 (Construction Defect Action Reform Act, legislative reference) |
https://leg.colorado.gov/bills/sb24-106
