Monday, July 13, 2009

What You Don't Know...

When do Statutes of Limitation begin to run on Construction Claims?

A Developer lays a Trap for the Unwary.

[Introductory Note: Statutes of Limitation are intended to protect defendants from stale claims. They are also traps for the unwary claimant. If the time period expires before an appropriate claim is made, legal rights can be permanently lost. Here’s a story about an artful attempt by a developer to deprive a new community association of some valuable time that it needs to evaluate the condition of the project before the limitation periods run out.]

You just moved into a new condominium project. You bought one of the first units sold in the second phase. Sales in that phase are just about done and then the project will be sold out. The project is just a little over two years old, so you are satisfied that any warranty items will get fixed. How hard could it be with the developer still on the board and with a few units left to sell? Everything seems to be going as expected.

But all is not perfect. The iron fences around the project are corroding badly. And the common area landscaping has a lot of dead spots where the irrigation system apparently doesn’t reach. There are places where rain and irrigation water pond for days and mosquitoes are breeding. You’ve also noticed that some of the wood fences in the project appear to be leaning. You went to the board meeting last night. Two owners are on the board along with three developer representatives. You raised those issues with the board, and one of the developer representatives told you that it was not the developer’s problem any longer, that it was the association’s responsibility to fix those particular defects. You argued that the developer is responsible for defects for ten years[1]. You also pointed out that you only noticed these problems a few months ago. So how could it no longer be the developer’s responsibility to fix clearly defective components?

Click on the title link above to read the rest of this article...

[1] That is not exactly a true statement. California Code of Civil Procedure Section 337.15 is actually a “statute of repose” which sets the outside limit of the developer’s liability for new construction at ten years from a specific date determined in accordance with the statute. There are many considerably shorter such periods in the law, such as those discussed in this article, which will cut off a developer’s responsibility much sooner, depending upon the type of claim made and as we discuss here, the type of building component that is the subject of the claim. A complete list of components and the time limits for bringing claims can be found on our website.