109 HR 4037 IH: American Homebuyers Protection Act U.S. House of Representatives 2005-10-07 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 109th CONGRESS 1st Session H. R. 4037 IN THE HOUSE OF REPRESENTATIVES October 7, 2005 Mr. Gonzalez introduced the following bill; which was referred to the Committee on Financial Services A BILL To prohibit offering homebuilding purchase contracts that contain in a single document both a mandatory arbitration agreement and other contract provisions, and to prohibit requiring purchasers to consent to a mandatory arbitration agreement as a condition precedent to entering into a homebuilding purchase contract.

1.

Short title

This Act may be cited as the American Homebuyers Protection Act.

2.

Mandatory arbitration agreements

(a)

In General

No person engaged in the construction of new houses may require a purchaser to enter into a mandatory arbitration agreement as a condition precedent to entering into a contract for the purchase of a new house. (b)

Separate Documents Required

No person engaged in the construction of new houses may offer a purchaser a contract for the purchase of a new house which includes an agreement on mandatory arbitration unless such agreement is a separate document which contains only language pertaining to the mandatory arbitration agreement. The separate document containing the mandatory arbitration agreement shall also contain the following statement: By Agreeing to Binding Arbitration You Are Giving Up Your Right To Go To Court. (c)

Arbitrator

The mandatory arbitration agreement shall not name an independent arbitrator and shall contain a procedure that adequately guarantees the purchaser an opportunity to participate in the selection of an arbitrator which shall occur only after a dispute regarding the homebuilding contract has arisen. (d)

Enforcement

If any person violates subsection (a), (b), or (c), the agreement on mandatory arbitration will be of no effect.