For most people, the purchase of a home is the largest purchase they will ever make. Buying a home and then discovering defects can have serious ramifications.
So, what options are available to you?
The New Home Warranty Act
In Mississippi, the buyer of a home can pursue a builder under a number of legal theories. The one addressed in this article is the New Home Warranty Act.
As the name of the Act indicates, it only applies to new homes. When a builder sells a new home, the builder automatically gives the following warranties:
- For a period of one (1) year, the home will be free from any defects due to the builder’s failure to comply with applicable building, mechanical, plumbing and electrical codes; and
- For a period of six (6) years, the home will be free from major structural defects due to noncompliance with the codes.
The Act excludes certain items, including detached garages, swimming pools, driveways, walkways, patios, retaining walls, fences, and landscaping. A more detailed list of the exclusions can be found at Miss. Code Ann. Section 83-58-5(2).
How can you enforce the warranties?
Before undertaking any repair (other than repairs that are necessary to minimize loss or damage), the homeowner must give the builder written notice within ninety (90) days of discovering the defect.
The notice should be sent by registered or certified mail. The notice must advise the builder of the defects, and it must give the builder a reasonable opportunity to repair the defects.
If the builder does not repair the defects within a reasonable time, then the homeowner may file a lawsuit to enforce the warranties.
Subsequent buyers of the home.
Although the Act only applies to new homes, once the warranties go into effect, they are automatically transferred to subsequent purchasers of the home.
So, for example, if Builder sells the new home to Smith, the warranties go into effect in favor of Smith. If Smith sells the home to Jones before the warranties expire, then Jones can enforce the warranties against Builder.
What damages can the homeowner recover?
With respect to defects, a homeowner may recover the reasonable cost of repair or replacement necessary to cure them.
In addition, if the builder violates the Act by failing to perform as required by the warranties, the homeowner also has a claim for actual damages, including attorney fees and court costs.
The Act is not an exclusive remedy.
As noted above, the New Home Warranty Act is one of several legal remedies available to a homeowner in Mississippi. By making these warranties available, the Act does not prevent a homeowner from pursuing other remedies, such as breach of contract, breach of the implied warranty of habitability, or fraud.
Panter Law Firm, PLLC, 7736 Old Canton Road, Suite B, Madison, MS 39110.