New Home Construction Defects in Georgia: Your Rights Against the Builder

What a great feeling, to be settling into the brand new, never-been-lived-in home that you recently purchased in a Georgia development…unless…well, unless you notice shortly after you move in that the driveway is already cracking because the builder used defective concrete, or that a puddle forms in the bedroom after it storms because the roof leaks. Now you're wondering, "What can I do?" As the owner of a newly constructed home in Georgia, can you hold the builder responsible for these or other problems?

Georgia Homeowner's Responsibility to Stop Further Damage

Before you look into whether the builder is responsible to fix the home defect you've found, you must first prevent the problem from causing any further damage. The builder is not responsible for any damage that occurs to the home after you've discovered the problem.

This means that once you discover the leak in the roof, if it is causing damage to the home, you must repair it as soon as possible. Even if the builder must ultimately repair the leak (or reimburse you for the repair), the builder will not be responsible for replacing the carpeting that got wet and ruined during the three storms that occurred after you discovered the leak.

If you make any repairs to prevent further damage, keep receipts and detailed records of their costs. Also keep any estimates or bids you receive from professional contractors to completely fix the problem. These documents are necessary to show the amount owed you if you are later successful with a claim against the builder for the home defect. If you can, take photos or a video of the defect and any damage it has caused. These can also provide useful documentation in any later claim against the builder.

Is the Problem Covered by Georgia's New-Home Warranty?

After you complete any necessary repairs, the first place to look to determine whether the builder is responsible to fix the defect is to the terms of the written warranty given by the builder.

Under Georgia law, home builders must provide a written warranty to the buyer before starting work on any job valued at over $2,500. (Georgia Code §43-41-7.) The warranty provided by the builder for the new home must, by law:

• be in writing
• explain what's covered and what's not
• identify the duration of the warranty
• describe the homeowner's claim procedures and the builder's response options, and
• assign any manufacturer warranties to the homeowner (these are usually warranties on large appliances such as the range or refrigerator).

(The warranty requirements are found in the Georgia State Licensing Board's rule 553-07).

Carefully review the terms of the builder warranty and follow all the procedures it calls for to make a claim. Usually a builder's warranty covers only defects in materials and workmanship (and specifically does not include normal wear and tear) for a specified period of time (typically one year).

Normally, if the defect is something covered under the warranty, and you make a claim within the warranty period, the builder will be responsible for fixing the problem or reimbursing you for the cost of fixing the problem (this is where that documentation relating to the defect and the repairs is useful).

If that doesn't happen, of course, it's time to see a lawyer. The first thing the lawyer will ask to see is your copies of any written claims or requests that you sent to the builder and the builder's responses, and your dated notes of any telephone conversations, so start keeping a file now.

Other Possible Claims of a Georgia Homeowner Against the Builder

If you find that the defect you've discovered with the home is not covered under the builder's warranty (maybe it's specifically excluded, or the problem appeared after the warranty period expired), you might not be out of luck.

Under Georgia law, an owner's alternative legal claims against the builder include breach of contract, negligent construction, or fraud. Whether you have a legitimate basis for such a lawsuit depends on the facts of your particular situation.

For example, if the home was not constructed according to the terms of the plans and specifications that you as, a buyer, signed off on as a part of the agreement for the purchase and sale of the home, you might have a claim against the builder for breach of contract.

If the problem is due to the home's poor construction (for example if you can show that the roof leak is due to the fact that the builder constructed the roof in a shoddy manner that no other builder would use), you might be able to bring an action against the builder for negligent construction.

If the builder outright lied about the quality or type of materials used, or deliberately concealed facts about the home (for example if the driveway cracks are due to the builder knowingly using a defective concrete that the builder told you was top of the line stuff), you might have a claim against the builder for fraud.

Although there is a limit to how long you can wait to file a lawsuit after discovering a problem with the condition of the home, this time limit (known in legalese as the "statute of limitations") could be longer than the warranty period. In Georgia, any claim for breach of contract must be brought within six years of the discovery of the defect (Georgia Code §9-3-24).

Also, any claim for negligent construction or fraud must be brought within four years from the time the claim arises (Georgia Code §9-3-30).

Notifications Necessary Prior to a Lawsuit - Georgia's Right to Repair Act

If you believe you have a valid legal claim against the builder for a defect in your newly constructed home, and you are within the time period allowed for starting a lawsuit, you still cannot jump right in and file a complaint with the courts. Under Georgia law, you must first provide the builder with certain notifications. Georgia's Right to Repair Act (Georgia Code § § 8-2A-35 through 8-2A-43) sets out certain steps that an owner of a newly constructed home must follow prior to filing a lawsuit, and allows the builder to resolve the problem before a lawsuit is initiated.

You should be able to find the relevant provisions of the Right to Repair act in your purchase and sale agreement for the home (a Georgia builder must provide buyers with notice of the provisions of the Right to Repair Act in any sales contract for a newly constructed home).

You'll see that the law says that before you (the homeowner) can initiate a lawsuit against the builder for a new-home defect, you must first send written notice to the builder regarding your claim. The notice must:

• be sent at least 90 days before initiating a lawsuit
• state that the notice is provided to meet the Georgia statutory requirements and that you are making a claim due to one or more construction defects
• specify the type of defect and the action you want from the builder, and
• include (if possible) any reports by professionals or other documents relating to the nature and cause of the defects (including inspections, photos or videos of the defect).

After receiving the notice, the builder has 30 days to give you a written reply, choosing either to settle the claim without an inspection (by paying the cost of the repair, making the repair, or both), or to inspect the defect and determine the need for any repairs. If the builder chooses to inspect the defect, after the inspection the builder must provide you with a statement either refusing to fix the defects (including the reasons) or offering to pay for or repair the defect (or both). If you reject the builder's offer, if the builder refuses to fix the defect, or if the builder fails to respond to your notification, then you may file a lawsuit.

Ideally, by following the steps of the Right to Repair Act, you can reach a resolution with the builder without needing to resort to a lawsuit. Since bringing a legal action involves a lot of time and expense and an unpredictable outcome, both the homeowner and the builder benefit if they can resolve problem without bringing it to court.

Where to Find Help

Hopefully, as the owner of a newly constructed Georgia home, you will find it's well constructed, in great condition, and you will settle in and enjoy living there with no problems. If you do discover a defect with the home after moving in, however, and are unsure the best way to proceed, contact a construction law or real estate attorney in your area. A professional can help you determine the best course of action, and ensure you are following the correct procedures to get a speedy resolution to the problem.