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The basics of builder warranty claims and defenses

On Behalf of | Dec 1, 2021 | Construction Warranties

If you are a real estate developer in Fort Lauderdale, it is likely that you will include a builder warranty in the contract for the build of your new development. A builder warranty covers permanent structures on the property such as concrete flooring, plumbing and electric work. The following is a brief overview of builder warranty claims and defenses.

What is included in a builder warranty?

Builder warranties usually only provide limited coverage on workmanship and materials used to construct the building. Builder warranties can also include provisions on how repairs will be handled. How long the warranty lasts depends on the components covered. For example, coverage for workmanship and materials generally lasts for one year. However, coverage for plumbing and electric systems can last as long as two years and some builders even provide 10-year coverage for major structural defects.

However, builder warranties generally do not cover incidental costs incurred following a construction defect, such as hotel costs incurred while repairs are being made. Small defects such as minor cracks also generally are not covered. Also, components covered by a manufacturer’s warranty generally are not covered by a builder warranty.

Builder warranty claims and defenses

If an owner believes they have a claim under a builder warranty, they should first consult their warranty. The builder can claim the problem was not covered by the warranty. If after checking their warranty the owner still believes they have a claim they should put in a written request for repair. It can help for both owners and builders to keep a paper trail of all interactions with one another regarding the alleged defect. If there is a legitimate dispute, the warranty may order the parties to address the issue in mediation or arbitration before a claim can go to court. These forms of alternative dispute resolution are often quicker and less costly than a trial, and they provide both parties to have a say in the final resolution of the dispute. With the right help, developers and builders can resolve their differences out of court in a matter that meets both their needs.