The Thrill is Gone: Responding to a Defect Claim
Because purchasing a home is typically the largest purchase a person makes in their lifetime, it quickly becomes a roller-coaster ride of excitement and emotions, encompassing hours of research, projections and financial analysis. So it should be no surprise that the thrill can quickly disappear and turn to anger if a homeowner discovers any problem with his or her substantial investment. All of a sudden, happiness turns to recrimination where a contractor is sure to be on the receiving end of what may be unwarranted accusations. But there are a few things a contractor should keep in mind in order to properly defend against any alleged defect claim.
Remaining calm and levelheaded so that you can properly evaluate the situation is a good start. Since the homeowner is so emotionally invested and because the sudden discovery of any abnormality or other defect is such a letdown, there is a likely tendency for the unhappy buyer to begin finger-pointing.
Rather than responding out of hand, make clear to the homeowner that you are equally surprised and concerned, and that you are willing to inspect the problem and are surely prepared to address what in fact may be your fault. This will allow you the opportunity to appraise the true extent of the alleged defect, analyze the expected cost for a resolution, and propose an effective solution while avoiding what might be a costly lawsuit. If your efforts prove fruitless or if litigation appears inevitable, there are still certain rights afforded to a contractor by law, rights with which the homeowner must comply.
For example, it is imperative to ascertain whether the homeowner is even within the proper time frame for filing suit. For example, in Florida, the statute of limitations on a discovered defect requires that a lawsuit be brought within four years of actual possession.
Be aware this time period becomes a bit sketchy when the defect is considered “latent,” a defect which is not discoverable even by the exercise of ordinary and reasonable care. When dealing with a latent defect, the statute of limitations allows four years from the discovery of the defect or when the defect should have been discovered through reasonable due diligence.
In most jurisdictions, it is not acceptable to simply allow a defect to sit idle without attempting to prevent the problem from worsening. This concept, known as mitigation, requires the injured party to exercise reasonable diligence and ordinary care to avoid aggravating the injury or increasing the damages. In fact, the failure to mitigate is commonly used as a defense to a defect claim by reducing the amount of damages awarded.
Therefore, it is important to discover how much time has passed from when the homeowner noticed the defect to when action was actually taken.
What is important for every contractor to know is that, in many jurisdictions, the homeowner is not allowed to actually repair the defect without first complying with certain notice requirements. Statutes have been implemented in an attempt to reduce the ever-growing litigation surrounding construction defects.
Certain legislatures around the country have imposed a mandatory notice provision to give the parties an opportunity to resolve any alleged defect issues without immediately resorting to litigation. By providing this stop-gap, the contractor is afforded the chance to conduct inspections and voluntarily correct the issue or offer a settlement before the relationship with the homeowner deteriorates into legal action.
Although the various notice statutes may differ between jurisdictions, the themes remain the same and all are designed to help expedite defect disputes. If and when you are contacted by a homeowner who claims to have discovered a defect with your work, do not panic – stay calm and review the situation; the law may just be on your side.