Inside New Construction

When errors are made, owners have more options than they may realize.

July 16, 2014

The clean sheen of a brand-new house is calming, but it can give buyers a false sense of security. Buyer’s remorse takes on a whole new quality when a just-completed foundation cracks or when water is pouring in through a brand-new roof.

Denver attorney Mari Perczak, a construction defect specialist with the Burg Simpson law firm, sees all kinds of defects in new construction. And with building activity picking up, mistakes are likely to increase as new tradespeople learn the ropes, she says.

One piece of advice that can help: Tell new-home buyers to identify who’s responsible for the construction. “Consider asking for the insurance information for the general contractor,” she says. That can be helpful in the event of defects.

In Perczak’s view, the biggest risk new-home owners face is running out of time to address problems. The statute of limitations on claims for defects in new-home structures is set at the state level. She says 10 years is the most common time period, though it is six years in Colorado where she’s based. There are also time limits for filing a suit after a home owner discovers a structural defect. (In Colorado, it’s two years.) Perczak says problems can take time to show themselves. “In our experience, it can take years, and problems can continue to be hidden,” she says. For example, defects related to moisture or concrete settling into unstable ground are difficult to detect in areas struck by drought. “You’ll see issues after a period of heavy moisture,” Perczak says. Construction materials can mask trouble. “Some types of cladding are really good at hiding those types of problems,” she says. And the most costly problems may not even be related to construction. Drainage and grading issues tend to be quite expensive to fix, she says.

Perczak says home owners often don’t understand their rights. Some believe they’re out of luck because the one-year warranty on their home has already expired. But she notes this “express warranty” from the builder doesn’t affect the right to sue under statutes defined by the states.

Advise clients who think there’s a problem to call an outside expert with no financial stake in the home. Sometimes owners err by calling the builder, who may refer them to the engineer in charge of the construction.  “It comes down to this: Don’t get legal advice from your builder, ” Perczak says. “When in doubt, bring in a good home inspector who can tell you whether or not you should seek the help of a well-qualified contractor or an architectural engineer.”

Meg White

Meg White is the former managing editor of REALTOR® Magazine.



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