Builder complaint? Better act promptly


August 05, 2001

Dear Mr. Azrael,

We settled on our new home in October 1997. Before we settled, we noticed water in the basement that the builder assured [us] would be fixed promptly.

Six or seven visits were made by the "punchout" crew after we settled with various explanations as to what the problem may be. Afterward, our calls to the builder were not returned. Letters were sent and not returned.

We then left the matter unresolved, after tiring from our efforts at a resolution.

We are still living in the home and still experience large puddles of water after a storm. Do we have any recourse?

Edward Ko

Ellicott City

Dear Mr. Ko,

You might have waited too long. Your legal rights against the builder might be lost.

Purchasers of new homes have legal rights against the builder for faulty construction. These rights arise from different sources:

Your contract.

The contract between you and the builder needs to be carefully reviewed. It might include provisions, or incorporate plans and specifications, relating to the builder's responsibilities in constructing the home. If the builder has failed to meet the standards established by the contract, the builder is in breach of the contract, and might be found legally liable for damages.

It might be too late for you to recover for a breach of contract.

In general, legal actions for breach of a construction contract must be filed within three years of the date the defect first appeared. Since you were aware of the water problem when you settled in October 1997, more than three years' time has elapsed. You didn't say when the builder last tried to fix the water penetration. Those attempts might extend the limitations period until three years after the builder last tried to correct the defect.

Maryland warranty law.

Maryland law gives a statutory warranty for new homes that requires that the home is "constructed according to sound engineering standards" and "constructed in a workmanlike manner." Your water problem might be caused by a failure of the builder to adhere to these standards.

However, it's too late for you to claim these statutory rights. Any legal action under the statute must be commenced at the latest, "within two years after the defect was discovered or should have been discovered." Since you discovered the defective condition more than two years ago, your rights under this statute are barred by limitations.

New-home warranty.

Another Maryland statute requires the homebuilder to disclose whether the builder participates in a new-home warranty program, and to provide a new-home warranty if the builder does participate. The law mandates that the warranty extend to structural defects for five years beginning on the warranty date.

You should review your paperwork to see if the builder made proper disclosure about whether the builder offers a new-home warranty, and if so, whether you received a new-home warranty.

A builder's failure to disclose whether it participates in a new-home warranty program is a violation of law, and might give rise to a successful lawsuit against the builder.

If a warranty was issued, you should contact the warranty company immediately in writing to assert a claim. Of course, it must be shown the water penetration problem you have experienced is caused by a structural defect.

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