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When consumer protection goes too far

Jerry Deschane is the president and owner of Deschane Communications LLC, a lobbying, consulting and communications firm specializing in the construction industry.

By Jerry Deschane

It seldom is politically correct to attack rules that protect the consumer.

But what do you do when those rules include paperwork requirements that are impossible to comply with? You tread carefully.

The Wisconsin Agriculture Board has voted to hold public hearings on modest revisions to the rule that is most despised by remodeling contractors: the home improvement trade practices rule, or ATCP 110.

The board has developed a short list of common sense changes covering major renovation projects, lien waivers and project delays. The changes are among a list of long-sought improvements requested by the Wisconsin Builders Association and the National Association of the Remodeling Industry, the two trade groups that represent remodelers.

ATCP 110, like most Wisconsin consumer laws, is stacked in the customer’s favor. Among other things, the penalty for violations of ATCP 110 includes double-damages plus recovery of attorneys’ fees.

The logic behind this tilt is that in most consumer transactions, the seller has the advantage in market knowledge and economic power, and the consumer needs a little help to level the playing field. By any measure, ATCP 110 does a good job protecting the consumer.

But it is hard for remodeling contractors to abide by the rule. ATCP 110 demands scrupulous attention to the wording of contracts, the timing of jobs and recording of payments.

Remodelers long have argued that, in some cases, it goes too far. For example, the rule penalizes a builder for missing a completion deadline, even when the delay is caused by the consumer.

The rule language relating to what sort of insurance must be carried by a builder is indecipherable. And the rule, written to guard against, for instance, unscrupulous door-to-door aluminum siding salesmen, applies the same business restrictions to major home reconstruction projects.

One proposal would insert an exemption in the rule for missing the completion date if the delay was caused by the consumer. A second proposal would exempt from rule coverage those projects that are so large they are more appropriately considered new construction than remodeling or home repair. And another proposal tries to clean up insurance and lien law provisions that neither consumers nor builders can read and understand.

As with any law designed to regulate an industry, those who are regulated always will chafe. The changes proposed by the board will not satisfy all critics of the rule.

Its heavy-handed penalties still can be applied equally to an honest contractor who made a mistake as to a fly-by-night thief in builder’s clothing. The rule almost begs an unscrupulous customer to team up with a hyper-aggressive lawyer to squeeze the remodeling contractor.

Nonetheless, the proposed changes are important steps toward restoring balance to the remodeler-customer relationship. If it still is not perfectly balanced, at least there is a chance for a little more common sense.

Jerry Deschane is the president and owner of Stoughton-based Deschane Communications LLC, a lobbying, consulting and communications firm specializing in the construction industry.

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