– Arizona Dwelling Act – Builder Requirements Arizona Statutes
– Requirements for Grading & Engineering




Lakshmi Anathwarthan
Blueberry Hills, LLC | Lakshmi Anathwarthan and its members
Strawberry Hills, LLC | Lakshmi Anathwarthan and its members

Path To Dream Home, LLC | Lakshmi Anathwarthan

Terra Vista Construction | Arizona ROC# 335092 | Lakshmi Anathwarthan


In this case study, we will be looking at a number of issues homeowners faced purchasing a new construction home in Arizona from Realtor/Builder “Laks” Lakshmi Anathwhrthan. A number of the builder’s construction defects and design failures were uncovered via public records searches and confirmed by consultation with county building officials and verified with professional engineering guidance as well as contractors, including excavators and water line installers.




The Arizona Purchaser Dwelling Act was enacted to provide a process for homeowners to notify builders of alleged construction defects and give builders an opportunity to repair the defects before litigation can be initiated.


Consistent with its legislative intent, the PDA PURCHASER DWELLING ACT in the State of ARIZONA requires a fair and effective process by which residential contractors receive a reasonable opportunity to cure alleged construction defects before they must defend a construction defect lawsuit. By the same token, purchasers are also afforded a vehicle to achieve correction of alleged construction defects before resorting to the court system.


In Arizona, builders are required to provide a written warranty to their clients for any new home construction or major remodeling projects, which includes warranties related to site work, grading, and stormwater management.


The Arizona Homeowner’s Warranty Law specifies that the warranty must cover certain defects for specific periods of time as follows:


1. Site work and grading: The warranty must cover any defects related to soil compaction and grading that affect the structural integrity of the home for at least ten years.

2. Stormwater management: The warranty must cover any defects related to the installation of drainage systems that affect the structural integrity of the home for at least ten years.


The specific sections that address the warranty requirements for site work, grading, and stormwater management are ARS 12-1361(B)(4) and ARS 12-1361(B)(5). These laws set forth the minimum warranty requirements for residential builders in Arizona and provide homeowners with legal recourse if these requirements are not met.

Additionally, the Arizona Registrar of Contractors (ROC) provides guidance and resources for homeowners and builders on their website, including information on the Homeowner’s Warranty Law and how to file a complaint with the ROC if necessary.


The Arizona Purchaser Dwelling Act was enacted to provide a process for homeowners to notify builders of alleged construction defects and give builders an opportunity to repair the defects before litigation can be initiated. As of my last update in September 2021, the Act was established in 2002, and it’s codified in the Arizona Revised Statutes at Title 12, Chapter 13, Article 2 (A.R.S. § 12-1361 and following).



A number of uncovered builder code circumventions and violations by the builder left homeowners without a water supply after 12 months of moving into a new construction property in the state of ARIZONA.


Code Enforcement in the county outlined the status of the home’s lack of water supply as a potential Life Safety Issue. 


Per The Arizona Dwelling Act builder was notified of issues and remedies to the life safety issue on the property and the urgency of the matter; at this time, the matter is unresolved despite the homeowner’s best efforts to work directly with the builder offering notice of the issue and numerous remedy proposals to avoid civil litigation.


Code Violations by Builder Lakshmi Anatwarthan

  • The builder failed to meet county wellhead height requirements for the 100-year floodplain.
  • The builder moved the fresh water cistern location off all site plans provided to the county building division. Changes in water line site plans are in violation of the local county code.
  • The builder failed to obtain a grading permit for earthwork and site grading around the primary residence.
  • The builder failed to obtain a grading permit ( and engineering ) for earthwork and site grading around the garage and driveway..
  • The builder failed to obtain a grading permit for the installation of a culvert on the property, meeting the 10-year engineering standards for on-property culverts



Builders Prior Knowledge


Builder received letters from the county advising property is in a 100-year flood plain and additionally, the requirements for obtaining grading permits and subsequent proper engineering requirements that would have avoided the Life Safety Issue of a stoppage of water supply.


The below-issued notices to builders from the county where on all issue building permits. Builder had knowledge of the following.

  1. If earthwork (beyond the footprint of proposed structure) in excess of 50 cubic yards, or other grading (including retaining wall) that triggers a grading permit (per Coconino County Engineering Design and Construction Manual, Chapter 3) is required, applicant shall apply for a grading permit. Manual_092018-w-Attachments


2. A remote drainage evaluation (using County aerial and topography) of your property was completed by a Coconino County Community Development Department Engineering Division staff member. This evaluation involved an analysis of on-site and adjacent off-site topography, and an estimation of likely stormwater runoff through your lot and its significance. The purpose of the drainage inspection is to identify any drainage conditions that pose either a probable or an imminent hazard to proposed or existing structures on your lot. This letter is to inform you that this parcel is impacted by the 100-year floodplain per best available data (IEA). Ponding depths are one foot (1′) in area of proposed structure.


The builder states,” There is no fault in the grading and it has exceeded Coconino county expectations and all the relevant codes,”

Public records requests In fact, confirm multiple codes have been identified as not meeting the minimum requirements.


  • The builder placed the wellhead location in direct proximity to an identified wash. While this is not a violation of ADWR Arizona Dept Water Resources, it was advised by ADWR is not a best practice. What is specifically in violation of the county code is the wellhead is well below the required 100-year floodplain height requirements. During seasonal winter snow melt, this low wellhead was overwhelmed, and the control module pumping mechanism inside the wellhead where compromised.
  • The lack of proper grading around the property ( as noted by standing water next to the foundation ) was a contributing factor.
  • The builder off permit placed the cistern within a few feet of a swale, which is not a recommended best practice due to underground hydrostatic pressure ( EXHIBITS Pending Photo & Videos )
  • The builder rather than using “engineered dirt” for the unpermitted grading work that was done. Builder brought in truckloads of free or low-cost rock-filled material from another construction site. This was confirmed by the builder’s own excavator, who said, ” I wish he used engineered dirt,” when referencing the grading that was directed to be done by the builder on the property during construction. . Excavated rock-filled nonengineered dirt does not have the same optimized drainage or compaction qualities as engineered dirt.
  • The builder directed the drainage path toward the cistern. This was confirmed by an assessment by local pump sales and service company. Independent Engineering evaluation further demonstrates this drainage path redirection as a culvert was installed without meeting county requirements for grading permits and 10-year engineering standards. This unpermitted culvert, in fact, forced greater drainage flows directly toward the swale & cistern.
  • The builder failed to compact the area around the originally excavated cistern location, as advised by the homeowners’ independent excavator and engineering consultations. A sinkhole of this size and scope is highly unusual and is avoided with proper compaction and proper materials ( EXHIBITS pending ).
  • The builder left large, heavy boulders directly on the excavated cistern hole. All cistern sellers contacted advised never to do this as it can lead to further negative effects of soil compaction around the cistern and void warranty.

All combined, the above builder code violations, builder design failures, and construction defects were all contributing factors that led to a sinkhole and compromised a water cistern and in turn, became a life safety issue with no adequate water supply at home that builder refused to remedy properly