How Dream Finders Homes Uses This Clause
Dream Finders Homes purchase agreements have been documented to include mandatory binding arbitration provisions. Dream Finders purchase agreements include mandatory arbitration provisions requiring disputes to be resolved through private arbitration rather than in court. The company has successfully compelled arbitration in construction defect cases, including the Silver Meadows Townhome HOA matter that settled for $12 million after arbitration was compelled (source: DFH SEC 10-K filing, FY 2021). This clause has been the subject of litigation, including Parkes at Stonebridge HOA v. Dream Finders Homes.
This provision typically appears within the purchase agreement alongside other terms that may limit buyer remedies. Because Dream Finders Homes operates across multiple states, the enforceability and practical impact of this clause varies depending on where the home is located.
Dream Finders Homes's scale means contract templates are largely standardized across its operations. A clause identified in one market's contract is likely present in other markets' contracts, though local addenda may modify the terms.
Builder-Specific Details
Combined with Class Action Waiver
The class action waiver and arbitration clause work together to ensure all disputes are handled individually in private proceedings.
Regional Contract Patterns
Dream Finders Homes operates in a more focused geographic footprint. Contract terms may vary somewhat between markets, but documented patterns tend to be consistent across the builder's operating states.
Standard Form Contract
This clause appears in Dream Finders Homes's standard purchase agreement, which is generally presented on a take-it-or-leave-it basis. Buyers typically have limited ability to negotiate individual terms, though making the request in writing is still advisable.
Legal History
The following cases involve Dream Finders Homes's use of this clause type.
Parkes at Stonebridge HOA v. Dream Finders Homes
The Parkes at Stonebridge Townhome Owners Association in Longmont, Colorado won a $6,413,204 arbitration award against Dream Finders for construction defects in a 92-unit townhome community built between 2018 and 2021. The arbitrator found DFH liable for negligence, breach of contract, breach of express warranty, and breach of implied warranty, awarding $5,733,471 for repair costs and $679,732 for litigation costs. Defects included crumbling driveways, heaving sidewalks, and sagging garage awnings. As of October 2024, DFH had not satisfied its obligation to pay post-judgment interest. The HOA filed a motion in Boulder County District Court seeking entry of judgment on the award (source: PR Newswire, October 31, 2024; Boulder County District Court filings).
Silver Meadows Townhome HOA v. DFH Mandarin, LLC
The Silver Meadows Townhome Owners Association filed suit against DFH Mandarin, LLC and Dream Finders Homes, LLC alleging construction and development defects. DFH successfully compelled arbitration. The parties settled in April 2022 for $12.0 million, including a $4.0 million insurance carrier payment, with DFH denying any admission of liability (source: DFH SEC 10-K filing).
Dream Finders Homes v. Weyerhaeuser NR Company
Dream Finders sued Weyerhaeuser over defective TJI Joists with a harmful Flak Jacket coating that affected 38 homes. After a jury trial on November 18, 2019, the District Court awarded DFH LLC $3,000,000 in damages and DFH Mandarin, LLC $11,650,000 in damages and dismissed Weyerhaeuser's counterclaim. Weyerhaeuser appealed the ruling (source: FindLaw, Colorado Court of Appeals; DFH SEC 10-K filing).
State-by-State Enforceability
Enforceability of this clause varies by state. The following reflects Dream Finders Homes's operating states.
| State | Status | Note |
|---|---|---|
| Florida | Likely Enforceable | Mandatory arbitration clauses in Florida new construction contracts are likely enforceable. Florida... |
| Texas | Likely Enforceable | Mandatory arbitration clauses in Texas new construction contracts are likely enforceable. Texas has... |
| Georgia | Likely Enforceable | Mandatory arbitration clauses in Georgia new construction contracts are likely enforceable. Georgia... |
| North Carolina | Likely Enforceable | Mandatory arbitration clauses in North Carolina new construction contracts are likely enforceable.... |
| South Carolina | Uncertain | The enforceability of mandatory arbitration clauses in South Carolina new construction contracts is... |
| Virginia | Likely Enforceable | Mandatory arbitration clauses in Virginia new construction contracts are likely enforceable.... |
| Colorado | Likely Enforceable | Mandatory arbitration clauses in Colorado new construction contracts are likely enforceable.... |
| Tennessee | Likely Enforceable | Mandatory arbitration clauses in Tennessee new construction contracts are likely enforceable.... |
Related Clauses in Dream Finders Homes Contracts
This clause often works in combination with other provisions in Dream Finders Homes's purchase agreements.
The class action waiver and arbitration clause work together to ensure all disputes are handled individually in private proceedings.
Challenges to the habitability waiver must be pursued in arbitration rather than court.
Disputes over deposit forfeiture must be resolved through arbitration, where the cost of pursuing a claim may exceed the deposit amount.
Warranty disputes with third-party administrators may also be subject to mandatory arbitration.
What Buyers Can Do
- Understand the arbitration process before signing. Review which arbitration provider is specified, who selects the arbitrator, and whether you have any right to appeal. These details significantly affect the fairness of the process.
- Research the arbitration provider's track record. The specified arbitration provider may have a history with builder disputes. Understanding the provider's procedures and typical outcomes can help you prepare.
- Review the Parkes at Stonebridge HOA case. The Parkes at Stonebridge HOA v. Dream Finders Homes ruling may be relevant to your situation. If you are buying a Dream Finders Homes home in a state with similar legal protections, this precedent could affect the enforceability of this clause.
- Have the full contract scanned before signing. This clause is often one of several interconnected provisions in Dream Finders Homes contracts that collectively limit buyer remedies. A contract scan can identify all of them.