Many builders of new home will provide what is described as their Limited Waranty. The word limited is often the most important word in the title. What happens when the defect is serious, but not covered by the Limited Warranty? Let me provide an example. Our client purchased a home for the largest home builder in the country. At the time of the walk through, everyone smelled skunk. The builder's representative said that is what you get in the country. The first night in the house found the family's young daughter and mother in respritory distress and on their way to the emergency room. The builder replaced the carpet 3 times and painted the floors but eventually dropped out of the process claiming, among other excuses, that the Limited Warranty did not cover the issue. Several more trips to the Emergency room, including a visit to the Intensive Care unit only made the builder more rigid in its claim that the issue was the buyer's problem.
Enter the Implied Warranty of Habitibility. In 1972 the Supreme Court of Pennsylvania became one of the earliest Courts to acknowledge the existence of the Implied Warranty of Habitability in connection with the sale of a new home. See Elderkin v. Gastner, 288 A. 2d 771 (Pa.1972). Ten years later the Superior Court was asked to examine whether or not a home builder could limit or disclaim the implied warranty. In Tyus v. Resta, 476 A. 2d 427 (Pa. Super. Ct. 1984), the Court first reviewed the following factors considered by the Supreme Court in Elderkin: 1) the builder possesses superior knowledge, 2) the implied warranties were necessary to equalize the disparate positions of the builder-vendor and the average home purchaser, 3) “a home buyer justifiability relies on the skill of the developer that the house will be a suitable living unit," 4) the builder has by far the better opportunity to make a home fit for habitation, and 5) because of the relative positions it is reasonable that a builder warrants “that the home he has built and is selling is constructed in a reasonably workmanlike manner and that it is fit for the purposes intended-habitation." Tyus, 476 A2d. at 431 The Tyus Court went on to hold “given the important consumer protection afforded by the implied warranties, we hold that such warranties may be limited or disclaimed only by clear and unambiguous language in a written contract between the builder-vendor and the home purchaser." Id. The Court went further stating: "To create clear and unambiguous language of disclaimer, the parties' contract must contain language which is both understandable and sufficiently particular to provide the new home purchaser adequate notice of the implied warranty protections that he is waiving by signing the contract. To supply proper notice, language of disclaimer must refer to its effect on specifically designated, potential latent defects. See discussion of latent defects, infra. Evidence that the purchaser and the builder-vendor actually negotiated the waiver language in the parties' contract will tend to indicate that the purchaser was aware of the contract's waiver language and its import and accordingly, will tend to substantiate a valid waiver." (citations omitted) Id. at 432.
What this means is it is almost impossible to waive the applicability of this warranty, which incidentially has a 6 year statute of limitations. If you have a defect in your new home, don't just read the builder's warranty, also consider the one the Supreme Court wrote for you.