What happens if your new home has construction defects? Kyle and Jenny bought a newly built house in a residential Pennsylvania subdivision. They’d spent many nights dreaming about what their new home would be like, with a walkout basement, French doors to the back patio, and more.
They carefully checked plans and agreed on a model. They signed the contract, obtained financing, and closed without a hitch.
Two years later, they started to notice water by the basement door. As time went on, they realized that the seal around it wasn’t installed properly, and water was getting in.
That wasn’t all. The basement floor developed large cracks. In one of the upstairs bedrooms, a large crack formed, running from the ceiling to the floor. Kyle and Jenny started to wonder if the house was falling apart around them.
They called the home warranty company – and were informed that the warranty they’d been given at closing lasted for only one year. Next, they called the builder – who never returned their calls. Finally, they called a lawyer to see whether there was anything they could do.
New home construction in Pennsylvania comes with something called “implied warranties.” These are guarantees, established by the courts for the good of the public. (There is no statute describing these implied warranties, but see, for example, the case of Elderkin v. Gaster, 288 A. 2d 771 (1972).)
One of these is called the warranty of habitability. Habitability means that you can live there – the plumbing works, the walls are sound, the roof is solid, and so forth.
The other implied warranty is called the warranty of reasonable workmanship. This essentially means that the builder is expected to construct the house in a professional and thorough manner. The warranty is also created by public policy – the need to ensure that builders will construct solid homes and not simply slap a few boards together and call it a home.
An interesting fact about these warranties is that they are not only implied to the original owner of the house. If the original owner sells the house soon after the construction, the warranties extend to the second purchase.
If an implied warranty is breached, the home buyer may demand that the builder act to remedy the matter. If the builder fails to do so, the homeowner may file suit.
Kyle and Jenny may also have rights spelled out in their original contract with the builder. When they review the contract themselves, or show it to their lawyer, they may find provisions guaranteeing certain things, such as the builder providing an express warranty of habitability or workmanship, or a statement that “the highest standards of construction technique will be used.”
Another example could be when a builder holds himself out as a builder of “quality construction” or “high end homes.” These words, in and of themselves, imply a certain standard of quality in the construction of the home.
Home buyers may also, in their large packet of closing documents, find other documents where the builder represented that the house was well constructed and according to the original plans. These can be used to support their case as well.
Again, the home buyers will need to comply with any of the contract’s requirements giving advance notice to the builder before filing a suit based on breach of contract. They may also need to enter into mediation or arbitration before – or even in place of – filing a lawsuit.
Kyle and Jenny may also be able to file suit for negligence. In order to prove negligence, they must be able to show that the builder was responsible for the construction of the home, that he failed in that responsibility by not constructing it according to plans or standards, and that the home buyers incurred costs or damages as a result.
In Pennsylvania, homeowners have 12 years from the date of construction to file an action regarding the construction of the home. (See 42 Pa.C.S. 5536.)