Too often, condominium associations unknowingly allow their legal claims to expire during lengthy construction defect negotiations with developers. If negotiations fail, the association may turn to an attorney for legal representation only to find their legal claims are time barred. This article explains how condominium associations can avoid this scenario by the use of tolling agreements to preserve their legal claims while engaged in potentially lengthy negotiations with developers to correct construction defects. READ MORE

WRITTEN REPAIR AGREEMENTS

Condominium associations should be careful about accepting verbal offers from developers to make unspecified “repairs” in response to complaints about construction defects. The informal nature of such an agreement may be appropriate given the circumstances. On the other hand, problems may arise when the developer’s definition of “repair” differs from what is required by code, contract or industry standard. READ MORE

ENFORCING STATUTORY WARRANTY RIGHTS IN MARYLAND

During the 1970s and 1980s, the Maryland Legislature enacted statutory warranties to protect consumers from construction defects in newly constructed homes and residential communities. Today, four separate statutory warranties apply to the sale of condominiums. One is an express warranty and the other three are implied warranties. Express warranties are based on a developer’s written representations about the quality of construction. Implied warranties are imposed by law in the sale of a condominium regardless of whether the developer made any written representation or even otherwise intended to create a warranty. READ MORE or Download PDF

ASSOCIATION’S RIGHT TO RECOVER ATTORNEY’S FEES

A condominium association may have the legal right to recover some or all of its attorney’s fees in a construction defect dispute with a developer. For example, in the case of Milton Company v. Bently Place Condominium, a Maryland Court awarded an association $500,000 in attorney’s fees following a four week construction defect trial against a builder and developer. READ MORE or Download PDF

WARRANTY REFORM LEGISLATION COMES TO MARYLAND

I recently had the privilege of drafting warranty reform legislation that was passed unanimously by the Maryland General Assembly and signed into law by Governor O’Malley, effective October 1, 2010. The legislation, known as Senate Bill (“SB”) 597, is intended to close “loopholes” that unfairly deny homeowners associations (“HOAs”) and condominium associations the protections afforded by statutory implied warranties for construction defects in new residential communities. READ MORE or Download PDF

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