Homeowners who have a limited new house warranty from their builders can file a claim for qualifying defects that are damaging their newly constructed home. They should consult a construction defect attorney if they are unsure if the warranty covers the defect.
When homeowners hire a contractor to build their new home, they expect the house to be safe and free of defects. However, even if a house looks perfect, it may have latent defects that homeowners will not find for months or years.
Latent defects in construction are problems with the house that the homeowners or inspectors cannot detect through a visual inspection of the home. Homeowners may not become aware of such defects for months or years. At that point, the defect may have caused severe damage requiring extensive repairs.
Most builders give homeowners a builder warranty, also called a limited new house warranty, to protect them against potential construction defects. Nevada law does not require builders to issue a new house warranty. However, many contractors include them in the contract of sale.
New house warranties include one-, two-, and ten-year terms. A typical warranty provides:
The one-year labor and material portion of a limited new house warranty covers defective construction materials and poor workmanship, leading to defects in the house. Faulty products or defective building material might include windows that leak, concrete that cracks under pressure, or drywall that crumbles. Defective materials include anything the builder used in the house’s construction that fails to function adequately. This portion of the warranty also covers any problems with labor leading to the improper installation of products.
The labor and material warranty covers almost any problem arising from the home’s construction. However, it only lasts for one year. For many defects, homeowners will not see the resulting damage for years. Substandard roofing or improperly installed windows that allow leaks are examples of defects that may not be immediately obvious. Leaks can occur between walls or inside attics where homeowners cannot easily see them. By the time the water damage spreads to a visible area, the material and labor warranty will have likely expired.
The two-year mechanical defect portion of the warranty covers problems with things like the plumbing, electrical, or heating and air conditioning system. This portion of the warranty is much more limited than the labor and material warranty. However, it can be very valuable if one of the expensive systems in a house is defective and needs extensive repair.
In a limited new house warranty, the term structural defect refers to specific problems with construction leading to issues with a house’s structural integrity. A structural defect is actual physical damage to a load-bearing portion of the home that causes it to become unsafe, unsanitary, or otherwise unlivable. Load bearing portions of the house include the:
While this is the legal definition of a structural defect, a limited new home warranty might specify that it covers additional defects beyond damage to the load-bearing structure. Construction defect attorneys in Nevada are familiar with limited new home warranties used by local builders. They can help homeowners determine what would be considered a construction defect under a limited new house warranty.
While limited new home warranties cover many defects stemming from the home’s construction, they typically exclude certain problems and expenses. Most warranties do not cover out-of-pocket expenses homeowners might incur if they move out of their homes while the builder or other contractors remedy the defects. They also do not cover:
When homeowners realize a construction defect has led to home damage, they should determine whether their limited new house warranty covers the defect. They can skip trying to enforce the warranty if the problem clearly is not covered or the warranty period has expired. However, if there is a possibility the warranty covers the defect, the homeowner should quickly notify the builder. It is better for homeowners to file a claim and withdraw it if it is baseless, rather than risk the warranty expiring.
Each limited new house warranty will outline the procedures for filing a claim. Many warranties require homeowners to send the builder a written notification. Others may include a telephone number to a hotline somewhere in the warranty documentation. However, homeowners should always notify the builder in writing. It is a good practice for homeowners to keep a record of their interactions with the builder in the case of a dispute. They can send the initial letter by certified mail and use the certified mail receipt to prove the builder received notice of the claim.
Homeowners should act quickly once they discover a defect. Warranties cover most defects only through the first year. Homeowners want to make sure they do not fall outside the warranty’s time limit because they delayed making their claim. They should also pay close attention to the warranty’s wording. Some warranties only require homeowners to file a claim with the builder within the designated period to claim their rights. Others require homeowners and builders to reach an agreement before the warranty’s term expires. Homeowners can consult construction defect attorneys in Nevada for help filing a claim or interpreting their limited new house warranty.
Builders and homeowners may disagree about whether a warranty covers the defect and resulting damages. If they cannot come to terms, they have to look for another option to settle their dispute. Warranties often require homeowners to submit to mediation or arbitration to resolve disputes with the builder.
If a warranty calls for mediation, homeowners and builders must meet with a neutral third party, called a mediator, and attempt to resolve their dispute. The mediator guides discussion between the parties and tries to help them reach an agreement. Mediators do not have any decision-making power. They can only make suggestions and nudge the parties toward a reasonable settlement.
If mediation fails, homeowners must submit a claim to arbitration or file a case against the builder in the appropriate court. If the warranty requires arbitration, homeowners must file for arbitration rather than with the court.
In arbitration, both sides present their case to an arbitrator or a panel of arbitrators. The parties can have legal representation and present evidence, witnesses, and expert testimony. The arbitrator acts as judge and jury and makes a final decision regarding the homeowner’s claim. Most warranties and agreements providing for arbitration require both parties to accept the decision without appeal, meaning the arbitrator’s decision is final. If homeowners lose their arbitration case, they cannot seek relief through any other avenue.
Homeowners can file a civil case against the builder in civil court if the warranty does not require arbitration. They can request that the builder perform its duty under the warranty agreement. They can also seek monetary compensation from the builder for the costs they incurred repairing their home. In a court case, the parties present their case before and judge and jury, and the jury decides whether the homeowner deserves to prevail. Homeowners can appeal the decision if they lose.
There are a few aspects of construction contracts that are often overlooked. Without a properly drafted contract drafted by an experienced construction attorney, owners can find themselves unprotected in situations that can result in extra cost and time. A carefully drafted contract will help owners avoid common problems that can derail a project.
There are six commonly overlooked aspects of construction contracts that, if included by a construction attorney, can protect owners from unexpected delays and costs:
Including a detailed project schedule provides clarity and security for owners. Construction contracts should include a baseline project schedule that provides the different phases of construction and their timelines. They should also include provisions for providing the owner with progress updates and a schedule recovery plan in the case of delays.
Construction contracts should include a way to resolve disputes that arise over change orders. A contract can include a provision that the contractor continues work when a dispute arises, resolving issues over price or timeline at a later date. Alternatively, a contract can provide for a fast-tracked dispute resolution to resolve any issues over change orders.
Notice provisions are important to ensure that owners stay informed of potential delays. The notice provision in a construction contract should specify that contractors should provide written notice of any problems that arise. It should further specify whether electronic notice is sufficient and in what circumstances special delivery, such as delivery by certified mail, is required.
Construction contracts should include provisions that specify the steps to be taken when a lien is filed. The contract can include language that requires the contractor immediately take steps to satisfy lien claims by any subcontractors. The contract can also require that the contractor indemnify the owner for any proceedings or lien claims if the contractor fails to take the necessary steps to resolve the claim after being notified by the owner.
Due to the COVID-19 pandemic, detailed Force Majeure clauses should be included in construction contracts. Force Majeure clauses typically excuse a party from completing its obligations if an unforeseeable event prevents its performance. The Force Majeure clause should specify that written notice that the clause has been triggered is required. The delay must end once the unexpected event ends.
It is important that if a legal dispute does arise, there is a legal mechanism to recover attorneys’ fees and costs. The easiest way to provide for this is to include a prevailing party clause in the contract that allows a prevailing party in an action (either a lawsuit or arbitration) to recover reasonable attorneys’ fees and costs. Without such a provision, a party to a contract could end up with no legal ability to recover attorneys’ fees.
It is also important to consult with an attorney to understand the legal implications of other contract provisions, such as arbitration provisions (waiving the right to a jury trial) and waiver of warranties. It is important not to sign a contract unless all terms are understood. A construction contract attorney can assist with explaining all possible implications.
COVID-19 may be fueling the construction defect crisis. Homeowners who are planning on building a house, or have recently built a house, should understand the risk of construction defects. Further, homeowners should ensure they have a remedy to correct any defects in their new home.
The past two decades have seen a constant upheaval in the housing market. During the Great Recession, an unprecedented number of people lost their homes. The demand for apartment buildings rose drastically as people looked for more affordable housing options. However, when the COVID-19 Pandemic made social distancing a necessity, the shared gyms, business centers, and common areas that were once a draw became potential health risks. People began to move away from densely populated city centers and look for homes with more room. Living in a house gives the option to remain socially distanced from neighbors, have more room to work and take care of family, and have more outdoor space.
The increase in demand for homes paired with a low existing home inventory has caused new construction to skyrocket. Homebuilders are struggling to work quickly and control costs. These factors alone are risks for increased construction defects. However, home builders are also dealing with a labor shortage. Fewer workers may lead to less oversight, leaving more room for mistakes.
Construction defects can be difficult for homeowners to detect because they are often hidden behind beautiful new exteriors. Some common hidden defects are leaks behind siding, under roof assemblies, through faulty window installations, or defective plumbing. Defective soils conditions can also be hidden and not become evident until many years of ownership have passed. These hidden defects can cause serious damage to a home over time and create financial and emotional hardship for a homeowner.
However, homeowners have options to protect themselves. Homeowners who are looking to build a new home should be sure to ask about the construction process and what quality control is in place before beginning construction. Further, they should ensure that labor and material warranties are in place. Ask the builder or contractor for their state contractor’s license number to make sure there aren’t any prior contractor’s board complaints, and most importantly, make sure to ask for proof of insurance so that there is an ability for financial recovery should something go wrong and damages are incurred.
If homeowners discover defects in their new home, they do have legal recourse under both Nevada and California law. Although navigating warranties and lawsuits in construction cases can be difficult, an experienced construction defect lawyer can help guide homeowners through the process. If you have questions about your rights as a homeowner, call a construction defect attorney.
Homebuyers whose dream home turned into a nightmare because of construction defects may have legal recourse against negligent builders. Buyers frequently put down significant amounts of money for new houses. In fact, generally, one’s home is their biggest financial investment. When these dream homes begin to fall apart, new homeowners may face significant financial challenges.
Even when homes are brand new, they are not necessarily free from defects. Builders can cut corners to save money or make mistakes in construction. Negligent builders and contractors can be made to pay in litigation because homebuyers may be entitled to a home that is free from defects. State law (e.g. Nevada vs. California) vary in procedure and available damage recovery, which is why it is important to consult with a construction defect attorney.
Construction defect claims generally involve two basic issues: 1) work that was not done in accordance with a written contract, plans or specifications or 2) work that was done in violation of code and/or standards and is causing damage. These defects can be patent (obvious to the naked eye) or latent (hidden defect generally discovered by an expert).
If a construction defect lawsuit is successful, depending on local state law, the homeowner may be entitled to recover for: cost of repairs, diminution of value, loss of use, expert fees, litigation costs, and sometimes attorney’s fees.
In some cases, construction defects appear quickly after moving into a new home. In other instances, the defects could take years to start showing damage to put a homeowner on notice of a potential issue. For instance, defective soil conditions could result in damage within the first year or could take many years to appear depending on dry or wet winters. Evidence of defective soil conditions could include: cracking exterior stucco, cracking interior drywall, especially at windows and doors, cracked tile floors, and difficulty opening and closing doors/windows. Anytime a homeowner sees excessive cracking at their home, an expert should be contacted because there is likely an underlying defect that is the cause of the cracking.
Even when purchasing a newly built home, it is a good idea to hire a third-party home inspector to check for defective conditions that a lay homeowner might not see or know is wrong. However, unfortunately, even with a good home inspector, some defective conditions may not appear until years after moving in. Once a homeowner sees or experiences defective conditions in their home, they should document the evidence with photos and videos as much as possible and put the builder or contractor on written notice immediately. If a homeowner is unable to get the builder or contractor to repair issues with their new home, it is important to contact a construction defect attorney because the time clock could be running out to pursue a claim. A homeowner needs to be careful not to let a builder or contractor drag things out because the homeowner could be at risk for a barred claim under applicable statutes of limitation or statutes of repose. Bottom line, when in doubt, a homeowner should contact an attorney to make sure they understand their legal rights.
Construction delays could lead to lawsuits between the property owner and the contractor, with both parties having the ability to sue the other. Both parties could end up suing each other in court cases and counterclaims. Before proceeding legally, it is important to understand the cause of the delay.
Some construction delays are unavoidable. For example, inclement weather could slow down construction. These could fall into the category of excusable delays. However, other delays may be caused by negligence or intentional actions. Whoever is to blame for the delay could face legal liability.
If the property owner is the cause of the delay, the contractor incurs extra costs for labor and renting equipment. Contractors may also forgo other work while they maintain the capacity to complete the delayed job. Property onwers can cause delays by changing the design or not making the property available when the contractor is able to work. There may be specific contractual provisions that apply to these types of delays.
However, oftentimes, it is the contractor who is the source of the delay. They could run into construction difficulties or not have enough people to do the job. The contract between the parties may give the property owner the legal right to seek compensation for certain delays. The delay must be unreasonable before the homeowner would be entitled to compensation unless there is a specific liquidated damages provision. The contract should define what would be considered unreasonable.
The facts of the case could also determine what is unreasonable. For example, if contractors are late because they are not diligently working, they could be liable. However, unreasonable delay cases are not easy wins for the plaintiff because they will need to overcome the contractor’s excuses for the delay. The contractor could have a colorable argument for why they were late. Just because contractors are late does not mean that they must automatically pay damages unless there is a liquidated damages provision expressly provision for liability and payment of damages.
Not every delay must lead to a lawsuit. Many court cases are avoided when attorneys from both sides engage early and come up with a solution. In some cases, they can renegotiate the contract to stay out of court. However, it is crucial that each party engage a construction attorney early in any possible dispute to work out the issues if the parties cannot work things out on their own. Hiring an attorney could help parties understand their legal rights and options.
Purchasers of commercial buildings or homes may still be able to file claims against the original builder/contractor for construction defects, even though they were not the original buyer. Even though there may be no contract between a subsequent buyer and the builder, the construction company could still be liable to anyone at some point in the future for errors in their work, depending on the facts. A person or entity whose interest in the property has been harmed may have the ability to file a lawsuit against the builder.
The law is written generally to apply to an owner of the property. There is no requirement in the law that the owner must be the original one. Instead, it would be someone who holds the title and privileges of property ownership. This makes sense because any owner can be impacted by a builder’s negligence or willful misconduct. If the law were not this way, people would hesitate to buy homes in the secondary market for anything other than new construction.
The main restrictions on one’s ability to file a Nevada lawsuit are the statute of limitations and statute of repose. Here, the time limit depends on the reason for the lawsuit. The property owner has ten years from the date of substantial completion to file a construction defect lawsuit – this is the statute of repose time period. There is no statute of repose time limit in actions for fraud. However, within the ten-year statute of repose, certain statutes of limitations will apply as well and must be considered. While the statute of repose period triggers from the substantial completion date, the statute of limitations triggers from the time a property owner knew or should have known of the defective condition. There is a different statute of limitations time period depending on the cause of action being pursued in the lawsuit. For example, in Nevada, there is a six year statute of limitations for breach of a written contract. Different limitation periods apply for negligence, breach of warranty, etc…
Subsequent purchasers could have a claim against the original builder, but it will depend on the specific facts of each case. A subsequent purchaser dealing with construction defects should contact a construction defect attorney to learn more about their legal options and how they may file a lawsuit against the builder/contractor. There are different requirements under Nevada law for residential versus commercial construction. Most construction defect cases are very technical, and they require thorough investigations before filing a claim against a builder. This generally involves hiring experts and generating written reports and costs of repair. An experienced construction defect attorney can help guide a property owner through this complex process.
The contractor, homeowner, or both may be able to be held liable when a neighbor’s home is damaged by the construction company’s work. One should not be made to bear the burden when a contractor that they do not hire causes them monetary harm. Who pays depends on a variety of factors including whether the contractor is insured, whether the homeowner is insured, and their coverage.
A homeowner has property rights, and one of them is not to have their home damaged when their neighbor has construction work completed. The neighbor must take care to hire the right contractor with a good reputation for safety. It is also the neighbor’s responsibility to ensure that the contractor is licensed and bonded. Otherwise, the neighbor would likely be on the hook for any damages that their contractor causes.
Presumably, the contractor carries adequate professional insurance to cover damages. This would be the first way to compensate the neighbor when something goes wrong. Licensing is a legal requirement in Nevada, but some disreputable contractors may cut corners. Handling a claim under these circumstances can be complicated because there may be numerous issues, including if the contractor’s insurance company tries to settle the claim for less than it is worth.
Legally, the homeowner who hires the contractor is responsible for what a construction company does on the job. It would be unfair to leave their neighbor in a financial hole for something that they could not control, done by someone who they did not hire. If the homeowner whose property was damaged cannot get the claim covered by the contractor’s insurance company, he or she could file a lawsuit against the neighbor. Moreover, if the neighbor has hired a shoddy contractor, he or she can also be made to pay when they do not have enough insurance. They could even be liable for negligent hiring.
One whose property has been damaged should meticulously document the harm. This includes taking pictures and contemporaneous notes about what happened. The homeowner should immediately inform the neighbor of what happened. If it looks like there is any reason why the damage would not be fully covered, the homeowner may be able to work with a construction defect attorney to potentially file a lawsuit against the neighbor and the contractor.
Builders take shortcuts in a number of ways, and it often leaves homebuyers holding the bag. Even though homebuyers have legal recourse, many of these shortcuts may put the integrity of the building and the safety of its occupants in danger. Here are five ways that builders cut corners to save time or money at their customers’ expense.
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Building materials are a large part of the construction cost, and they are the foremost way that a builder tries to skimp. Things like lumber, roofing, and flooring have lower-cost options, and there is usually a difference in quality. Some buyers pay for an upscale building, but the builder uses cut-rate building materials. This often becomes apparent very quickly after the buyer takes possession.
There are noticeable benefits of hiring experienced construction workers who know what they are doing. Unfortunately, builders may decide to save money by hiring cheaper workers. However, they generally get what they pay for since construction workers are not fungible.
The builder is obligated to provide things like an HVAC system and refrigerator with the initial construction. Homes need utilities to be sized properly to reflect the square footage. Builders may install air conditioners and hot water heaters that are too small to save money, even though the home size requires larger units.
The construction process takes time to get right. Many installations have intricate multi-step processes and must be sequenced correctly. Builders may skip a step or two to save time or allow one trade to install before another simply to save time and money. This is where buyers need to be careful because things may look like they have been installed correctly, and problems only manifest themselves later in time.
Every construction job should have a foreman who oversees the job and ensures that it is done correctly. This should be a skilled and experienced person. However, some builders do not have a supervisor or hire an inexperienced person to save money. Supervision is much of what ensures that building standards and codes are followed. Without it, unskilled workers may make mistakes that buyers get stuck with for years to come.
Many buyers contact a construction defect attorney when they discover that the builder cut corners. They may be able to recover when the builder does not provide them with what they paid for under the contract if they file a construction lawsuit.
The steps that one takes in preserving evidence are crucial to a strong construction defect case. Proper notice to involved parties and ensuring that adequate inspections and testing takes place can make or break a case.
The building itself is physical evidence and, thus, must be preserved in the same manner that electronic records, documents, and other forms of physical evidence. When damage appears or disputes arise, most building owners want the issue resolved as quickly as possible to mitigate damages and preserve the integrity of the building.
However, removing concrete, replacing wiring, fixing plumbing systems, etc. can alter the condition of the building and can potentially destroy the physical evidence proving that the defective conditions are the result of initial construction. If reasonably possible, it is crucial that the builder or cotractor who did the initial work be given notice of the issues prior to repairs being done and that any removed evidence is preserved with a documented chain of custody.
In some instances, destructive testing is necessary in order to discover the relevant evidence and cause of the construction or manufacture defect. However, there are times that nondestructive inspections and testing are sufficent. It is critical that ample photographs, videos, expert opinions, and thorough documentation of any testing or repairs be preserved and produced. Tip of the day – when in doubt, document with photos as well as videos, and save all invoices.
Nondestructive testing must be conducted by a licensed professional. This reduces the possibility of errors and further damage to the structure. Before commencing testing, the contractor must be provided with as many details as possible including the building’s plans, specifications, and any details regarding materials or construction techniques that should be factored into the testing procedures and process. Sometimes it is helpful to review relevant subcontracts or RFPs to determine the work actually done and by whom.
Many types of nondestructive tests can be performed to confirm building defects. These include the following and more:
Each of these tests can and have been used to establish construction deficiencies including improper compaction of soil, deficient concrete, and improper sealing of plumbing systems. These tests are supported by sound science and when performed correctly will generate reliable results that can be used to establish deficiencies without damaging the structure.
There may be defective conditions that cannot be seen with the naked eye or with nondestructive testing and will required “destructive” or “intrusive” testing. It is important that a proper expert is hired to evaluate the methods and reliance of said testing to ensure sufficient evidence for trial. Defective items such as stucco, plumbing, soils conditions, leaking windows/doors are all things that could require destructive testing. Consult with an attorney to find out if defective conditions at your property might require an expert evaluation.
Before making repairs to defective conditions at your home, call an attorney to find out what steps you need to take in order to preserve the evidence for your case.
Defects in bridge structures are common and can pose a significant threat to life and property. It is estimated that nearly 10% of bridges in the United States are classified as structurally deficient. That is approximately 60,000 structures which means deficient bridges are a problem that affects a considerable number of towns, cities, and communities.
Concrete bridge structures are susceptible to corrosion, carbonation, creep, shrinkage, water penetration, and alkali-silica reactions. One of the most common causes of damage to steel-reinforced concrete bridges is rebar corrosion. As the rebar begins to rust, it expands which facilitates further and faster deterioration of the bridge deck.
Delamination is another common bridge defect. As the steel rebar within the bridge corrodes, it can cause horizontal deck delamination. In most cases, this does not become apparent until structural failure occurs. Over time, it is this type of damage that can highlight irreversible deterioration of the bridge deck and can result in sudden collapse.
Steel bridge structures are susceptible to similar types of damage, including corrosion and both low-cycle and high-cycle fatigue. Steel bridges may also develop cracks in elements and joints, as well as deficiencies within connections. They may also suffer permanent deformation such as buckling or bending when exposed to heavy loads or severe freeze/thaw cycles.
In addition to the bridge deck, the substructure can suffer significant damage to the foundation, abutment, piers, or retaining walls. Damage to these substructural elements can radiate throughout the structure and exacerbate damage to the deck. These types of damage can be caused by changing soil conditions, weather, and motor vehicle accidents.
Prompt detection of bridge defects is crucial for preserving the structural integrity of the bridge deck and other structures. This includes routine visual inspections and monitoring of any potential deficiencies. However, current standards in the United States mean that most bridges are inspected only once every two years, and less than 12% are inspected annually.
Other types of inspection/testing include condition surveys. These mildly destructive tests involve testing core samples to identify potential problems. In lieu of this type of testing for construction defects, non-destructive testing may include the use of the ground-penetrating radar, ultrasonic surface waves, or chain drag/hammer sounding. These tests can be used to monitor the structural integrity of the bridge and to track potential issues as time progresses.
