Several years ago, Georgia adopted state-wide, minimum building codes applicable to all localities of Georgia, including cities and counties that had not adopted building codes. The building codes are developed by non-governmental entities who also sell the books containing the building codes. As a consequence, the building codes change often. It is a frequent challenge for lawyers, designers, building officials, builders and others to determine what code applies to a particular building or condition. The Court of Appeals recently addressed this thorny issue in a case involving the construction of a log cabin-style home in a rural county which had not adopted a building code.
In Lumsden v. Williams, Case No. A10A1395 (Ga. App., Nov. 30, 2010), the buyers sued the builder/seller for a number of defects in the home. They contended that the minimum building code applicable to the cabin was the International Residential Code for One- and Two-Family Dwellings ("IRC"), 2000 Edition, as published by the Southern Building Code Congress International, Inc. The IRC became the Georgia minimum standard building code by amendment to the statute on July 1, 2004. Construction of the log cabin had begun in March 2004, at which time the Council of American Building Officials One- and Two-Family Dwelling Code ("CABO"), was in force; however, the buyers did not purchase the home until December 2005. The Court ruled that the applicable building code should be determined as of the beginning of the home's construction even where the legislature adopted the new code during construction. The buyers nevertheless argued that the IRC was simply a new or subsequent edition of CABO; however, the Court held that the IRC was an entirely new, stand-alone building code for residential construction. As a consequence, the Court struck, and refused to consider testimony from expert witnesses whose testimony about the construction defects was based upon the more recent IRC rather than the earlier CABO Code.
Another significant aspect of the decision concerns the time period for enforcing a one-year warranty in a construction contract. The parties' contract contained a warranty "against all defects in labor and materials" for a one year period. The trial court had ruled that the one-year warranty would cover only claims that were reported to the builder within one year. The Court of Appeals reversed the ruling. It observed that the warranty imposed no condition that the buyers should provide notice of defects within one year. Unless the warranty requires notification within the warranty period, no notice is required. In such case, any claim of defect that occurs or arose within the one-year period may be asserted notwithstanding the fact that it was reported to the builder after more than one year.
The Court of Appeals continues to explode the fallacy that a contractor's liability for a one-year warranty against defects in materials and workmanship is barred after one year. In fact, so long as a defect occurs or arises within that period of time, the party asserting the warranty claim has the full statute of limitations for asserting a claim based upon breach of contract -- as long as six years if the claim is based upon written contract. Contractors may wish to impose a condition in their warranties that a defect must be reported, or notice provided, to the contractor within the warranty period to be considered a valid warranty claim.
For more information, contact Bart Gary at [email protected].