| Q: |
In the event of defective construction, what are the rights
of the owner of a single family home where the home is not part of a subdivision
created under the Oregon Condominium Act? |
| A: |
The buyer of a new home from the original developer has those
rights that are provided in the contract of sale. Normally, these rights
are limited. However, in addition to those rights, the buyer also has rights
under Oregon Common Law. These rights include certain implied warranties
of construction quality. Also, a homeowner may have a claim against the
developer or contractors for negligent construction and may have a claim
against the developer for fraudulent concealment of a known defect. |
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| Q: |
In determining his or her rights against a developer, should the owner of a single family home rely on the provisions on that subject contained in the sales contract? |
| A: |
Yes and no. Certainly the sales contract is the place to begin in understanding a buyer’s rights. However, these rights include not only the rights provided in the sales contract, but also “common law implied warranty” rights. These common law implied warranties of construction quality are rarely mentioned in sales contracts, but often provide the buyer with more rights than those described in the sales contracts. Also, as noted above, an owner may have a negligence or fraud claim. |
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| Q: |
What if Oregon’s implied warranties of construction quality of a newly constructed single family home are waived in a sales contract? |
| A: |
Implied warranties of construction quality can be waived by a
buyer, but the requirements for such a waiver to be effective are difficult
to satisfy by developers. As a result, such waivers are often ineffective.
This means the buyer’s common law implied warranties of construction quality often remain operative in spite of contract language to the contrary. |
|
| Q: |
How long is the statute of limitations on a claim of breach of
common law implied warranties? |
| A: |
Normally six years, arguably measured from the date of first sale of the home. |
|
| Q: |
If an owner has not bought from the developer, does the owner of a single family home have implied warranty rights against the developer? |
| A: |
Possibly. However, Oregon case law is not definitive on this
issue. |
|
|
Q: |
In addition to possible express warranty and statutory warranty
common law implied warranty rights, and negligence claims, what other rights
may the
owner of a single family home located in Oregon have? |
|
A: |
The owner of a single family home may also have fraud or unlawful trade practices claims against a developer. However, to establish such claims, the homeowner may have to show that the developer knew of defects and failed to disclose them. |
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|
Q: |
Can the owner of a single family home obtain an attorney fee award against the developer? |
|
A: |
Yes, if the home is part of a subdivision created under the Oregon Condominium Act. If the home is not part of such a subdivision, attorney fees may be awarded if there is an attorney fee provision in a sales contract with the developer that would apply to the claim. Also, a successful claimant under the Oregon Unlawful Trade Practices Act will be entitled to an attorney fee award. |
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|
Q: |
Will an attorney take my case on a contingent fee basis? |
| A: |
That depends on the attorney. Many attorneys will take a case
involving a single family home on a contingent fee basis only if a homeowner
is one of
a group of homeowners with similar claims. However, if you do not come to us
as a member of a group of homeowners, we may agree to handle a claim involving
your single family home on a contingent fee basis if you are willing to act
as a representative of the homeowners in your subdivision, allowing your claim
to proceed as part of a class action by the owners of a group of homes against
the developer of those homes.
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