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Who pays for a construction defect in a residential property?

A new home owner has a reasonable expectation of entering into a house that is free of egregious defects. Unfortunately, such defects occur from time to time.

A construction defect can be the result of shoddy workmanship, inferior materials, poor engineering or architectural planning, or it can be the result of a natural phenomenon such as heavy rain or high winds.

Some defects are apparent at first sight while other may take years to come to the fore.

Some of the most common defects

Some of the most common defects include:

  • Mold
  • Water damage
  • Improper drainage
  • Dry rot
  • Improper electrical or plumbing installation
  • Foundation and floor cracks
  • Leaky roofs

When a case involving defects goes to court, the amount of damages usually includes the cost to repair the defect and the decline in value of the home because of the defect. Other costs that me be added on include the cost of temporary housing, court costs and attorney’s fees, as well as recovery for any injuries. In some rare cases, punitive damages may be considered.

Time limits on lawsuits vary by state

The amount of time between construction and when a lawsuit can be filed is determined by each state’s legislature and revolves around a variety of issues. Chief among the issues is whether the defect is patent – easily noticeable – or latent – not obvious to a reasonable person.

Claims against architects, engineers, contractors and subcontractors vary between the states and involve theories including breach of warranty, contract disputes and tort claims.

States have different statutes of limitations that determine the amount of time a claim can be filed after discovery of the defect, and statutes of repose that determine the amount of time between construction and when a claim can be filed.

Some states feature a “right to cure” statute in which the construction firm responsible for a defect has the ability to fix the defect or pay for the problem before a lawsuit is filed.

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