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Construction Defect Basics

One of the most stressful aspects of purchasing, building, or remodeling a home is the potential for known and unknown construction defects. A construction defect -- such as a faulty electrical system, roof cracks, leaking pipes, or other structural failure -- can significantly reduce the value of your home, not to mention cause unnecessary stress to your living situation. Some defects are difficult to spot until years later, after they have caused noticeable damage. This section covers the basics of construction defects and what you can do to remedy a defect, including the different types of construction defects and an overview of legal liability for construction defects

Types of Construction Defects

All homes require regular upkeep and occasional repairs, but construction defects are essentially errors in design, materials, or construction. They may include unstable or cracked foundations, water intrusion, or uneven surfaces caused by expansive soils. The main types of construction defects include the following:

  • Design Defects - These are problems caused by architectural or engineering designs that either were not properly executed or else didn't perform as expected. A poorly designed roof, for instance, may result in water intrusion or lack of proper structural support.
  • Material Defects - Sometimes poorly designed or manufactured materials can cause major problems, such as leaky windows or deteriorated flashing.
  • Construction Defects - Even with the right design and materials, inferior workmanship can create a cascade of problems. For instance, the failure to install proper ventilation may result in extra moisture and mold growth.
  • Subsurface Defects - While these defects relate to the actual ground on which the house is built, it becomes a defect if builders fail to account for shifting soil or steep hillsides.

Liability for Construction Defects

When you are faced with a construction defect, the first step is to determine whether it is a defect in design, materials, construction, or subsurface. The responsible party may not be easily apparent at first, particularly since so many parties are involved in building a home (including subcontractors, architects, suppliers, and manufacturers). Then you and your attorney will want to determine the appropriate cause of action, be it negligence or something else. Allegations typically include one or more of the following:

Negligence

This is perhaps the most common allegation when assigning fault for a construction defect. To be negligent is to fail in your obligation to exercise the same level of care, skill, and knowledge as would a reasonable person in the same profession. For example, a reasonable carpenter would check to make sure everything is level. If your builder failed to do so, leading to a structural defect, then he or she is negligent and therefore liable.

Breach of Contract

To be in breach of contract is to default on one or more responsibilities laid out in the contract. If the contract specifically states that all countertops and bathroom vanities are to be of a certain quality of marble, but the builder cuts corners and gets a cheaper alternative, then they are liable. With these kinds of claims, courts typically invoke what is called the "doctrine of substantial performance," in which the builder to pay the difference in home value resulting from the breach.

Breach of Warranty

Warranties regarding a property's condition are often set forth by developers in the purchase documentation presented to homeowners. Also, courts have held that there are certain implied warranties with respect to a home. So if the exterior walls disintegrate after the first rainfall, it may be considered a breach of warranty even if the warranty did not specifically mention the exterior walls.

Strict Liability

Most jurisdictions impose strict liability on the general contractor for breaches of the implied warranty of habitability. A home built in Vermont without adequate insulation may be considered a breach of this implied warranty, triggering strict liability requiring the builder to take action.

Fraud & Negligent Misrepresentation

If the developer or contractor intentionally misrepresents the quality of the homes in advertisements or sales documents, for example, they may be sued for fraud.

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