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Colorado Construction Defect Guide

Construction Defects are defined as a failure to construct a home or building in a reasonably workmanlike manner and/or the structure fails to perform in the manner that is reasonably intended by the buyer.

Examples include, but are not limited to:

  • defects from expansive soil
  • poor drainage
  • interior or exterior cracks
  • unstable foundations
  • window, bathroom and roof leaks
  • insufficient water supply
  • heating system problems

Who is Responsible?

Typically the general contractor, developer, or builder. Colorado law also allows a homebuyer to pursue a lawsuit against other professionals such as architects, builder-vendors, engineers, surveyors or inspectors.

Who Can Make a Claim?

Any individual or entity that has sufficient interest in the litigation to assert a claim.

What are My Recoverable Damages?

Damages may include cost of repairs, reduction in market value, loss of use of the residence and lost profits, expenses for temporary housing during repairs, prejudgment interest, and possibly emotional distress and punitive damages.

How Much Time Do I Have to Make a Claim?

Regardless of the builder’s one-year express warranty, various Colorado statutes extend the time that a homeowner can make a claim. Consult your attorney on your individual case.

Construction Defect Lawsuits

In the last 40 years, Colorado courts have led the country in permitting buyers to seek legal redress for construction problems under a variety of legal theories, including:

  • Breach of Warranty and Breach of Contract - Express warranties (written) or Implied warranties (the sale of a home implies that it was built according to codes in a workmanlike manner and suitable for habitation).
  • Negligence - Where the completed work is reasonably certain to endanger people because it was negligently constructed, a contractor or builder will be held liable for resulting injury or damage.
  • Fraudulent Concealment and Negligent Misrepresentation - Failure to disclose known defects or facts that greatly affect the value of the property.
  • Violation of Disclosure Law - Every developer/builder must provide the purchaser with a summary report of the analysis and site recommendations for a new home at least (14) days prior to closing.
  • Strict Liability - The builder has supplied a defective product which causes damage to other parts of the structure.
  • Colorado Consumer Protection Act - Allows a homeowner to collect three times actual damages, plus all costs and attorneys fees. Must prove (1) builder represented property of a particular standard if he knows it is of another or (2) builder showed false/misleading advertisements or showed an illusory warranty.
  • Breach of Fiduciary Duty- If the developer’s appointees to the association conceal information from the homeowners or act to protect the developer from liability for construction defects.
  • Statute of Repose - No action involving the planning or construction of the house can be brought more than (6) years after substantial completion of the house. Consult your attorney regarding the several exceptions.
  • Statute of Limitation - Construction claim must be filed no later than (2) years after a homebuyer discovers, or should have discovered, the physical manifestation of a construction defect.

Standing to Sue The Colorado Common Interest Ownership Act (CCIOA) specifically gives a HOA the power to institute and defend litigation on behalf of itself and its members. Alternatively homeowners can file a class action lawsuit against the builder/developer.

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