Calif. Court Says FAA Preempts State Law on Construction Defects

SACRAMENTO, Calif. - A California appeals court has ordered a homebuyer to arbitrate construction defect claims in accordance with his purchase agreement, ruling that the Federal Arbitration Act preempts a state law allowing homebuyers to pursue court actions. Shepard v. Edward Mackay Enterprises, Inc., et al., No. C052564 (Calif. Ct. App., 3rd Dist.).

California's 3rd Appellate District concluded in a published opinion on March 22 that a builder's evidence that materials were purchased out of state was sufficient to demonstrate interstate commerce and bring the homebuyer's claim within the purview of the FAA.

John T. Shepard sued Edward Mackay Enterprises …