Construction Law & Litigation: Understanding Warranties

Customizing a home is exciting and homeowners understandably want the reassurance that their project is in good hands. However, even properly licensed contractors make mistakes. Consumers will often be protected through “Warranties.” Warranties can be express or implied. Through warranties, homeowners will have a contractual remedy in most instances, should problems arise.

Read on to learn more.

What Is a Workmanship Warranty?

As mentioned above, warranties are promises that can be either express or implied. Typical warranties include a contractor promising to work in accordance with the plans and specifications for the project; or in a good and workmanlike manner. When a contractor fails to live up to his promises under the contract, an injured party may sue for breach of contract. In Arizona, a homeowner may bring a claim for breach of contract claim within six years if the contract is written. However, homeowners will only have three years to bring a contract claim if the contract is oral.

Hiring a Contractor

The best way to avoid disputes is to do your due diligence when hiring a contractor. Start by verifying each contractor’s license is valid and covers the work being requested, which you can do online here. Then, request multiple references and follow up on the information you have received. Also, be sure to get a detailed quote from each company. That includes receiving a quote about all relevant costs and permit responsibilities. The Arizona Registrar of Contractors recommends shopping around and getting multiple quotes before choosing a company to work on your home.

Once you’ve found a suitable contractor, you can start drafting your agreement. It should include the following:

• A breakdown of the costs associated with every aspect of the project, including incurred fees.
• Who is responsible for obtaining permits, HOA notifications, temporary utilities and other related terms.
• A payment/draw schedule.
• Clear description of a project change order signed by both parties.
• Any other terms you’d like to include regarding the project.

Before entering into an agreement, you may be inclined to demand specific assurances from your contractor, such as “I want this project done by March 15, 2022” (also known as a “time is of the essence” clause). These assurances will operate as contractual provisions and protect homeowners if the contractor fails to meet his or her obligations under the contract. If these potential provisions are important to you, you should try to negotiate them in writing before the contract is signed.

Filing an ROC Complaint

As an Arizona homeowner, you have the right to seek legal remedies if there is a breach of contract. The Registrar of Contractors (ROC) can order corrective work to be done if a claim is brought within two years of completion. Completion is defined as “earlier of close of escrow or actual occupancy for a new home or other new building construction” or completion of a specific project. The ROC can impose a corrective work order within two years of completion even if your contract specifies a one-year warranty period. A link to filing a claim can be found here. Once that two-year window closes, the homeowner must prove in court that the contractor breached the contract.

Find an Experienced Arizona Real Estate Lawyer

The attorneys at MacQueen & Gottlieb have vigorously represented clients with complicated real estate disputes in Arizona for years. Our firm is prepared to help you defend your interests with construction defects and consumers’ rights in Arizona when necessary. Contact us today at 602-726-2229 to schedule a consultation or make an appointment online.