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It is not unfair to the builder or contractor to extend the implied warranties of habitability and workmanlike quality to subsequent purchasers who not only discover latent defects in their home within 10 years of the home's substantial completion, but who then file suit thereon within a reasonable period of time after discovering such defects.
Defendant builder constructed a home, which was sold to defendant's cousin. Defendant repaired defects after the home was completed. Three years later plaintiffs, husband and wife, purchased the home. After residing in the home for three years, the garage floor caved in. Plaintiffs filed suit for negligent construction, breach of implied warranties, and negligent violation of certain building code provisions. The trial court granted defendant's motion for summary judgment.
Could the buyers of a latently defective home maintain an action against the house builder -- with whom they lack any contractual privity -- for the builder's alleged breach of implied warranties of habitability and workmanlike quality?
The court abandoned the privity requirement for claims made by subsequent purchasers against a builder or contractor for breach of an implied warranty of good workmanship for latent defects because the implied warranty was to protect innocent buyers, and latent defects would not manifest until after the home was sold to an unsuspecting buyer. The court found the statute of repose did not apply to a contract-based breach of implied warranty claim.