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Illinois Supreme Court Decision Upholds Builders’ Rights in Warranty Cases

In 2011, a homeowner filed a lawsuit against a homebuilder because a retaining wall failed causing the collapse of a large patio at the home. According to the Cook County Record, the homeowner was the second owner of this particular property having purchased it from the original owner. The original owner had purchased the property from a now defunct homebuilding company, and the state’s highest court’s decision turned on an action taken by the original homeowner during the original purchase. According to the article’s information regarding the allegations in the lawsuit, the plaintiff in this case attempted to secure compensation for the thousands of dollars of damage caused by the patio’s collapse based on an implied warranty of habitability. The original trial court that heard the case ruled in favor of the homebuilder based on the fact that the original owner of the home had purchased the property opting for an express warranty and waiving their rights to an implied warranty. When the new homeowner appealed the decision, the appellate court ruled in favor of the homeowner and reversed the decision of the lower court. Eventually, the case was appealed to the Illinois Supreme Court, who ultimately ruled in favor of the homebuilder once again.

Understanding Express and Implied Warranty

Most products that consumers purchase, including houses and other large consumer goods, are protected by a warranty. However, that warranty is not always specifically stated or set forth. The two main types of warranties for consumer goods are express warranties and implied warranties. An express warranty is a product warranty that is clearly stated, often in writing when the value of the product is as substantial as that of a house. Express warranties can also be verbal in some instances, though the existence of a verbal express warranty can be difficult to prove. The express warranty is basically a guarantee by the seller of a product that the product will meet certain expectations, and that the seller will be responsible for costs associated with such products if they do not meet those express guarantees.

On the other hand, many products are also inherently covered by an implied warranty that states the product will work as the seller has claimed it will. In the case of a home, this is referred to as an implied warranty of habitability. That means that it is implied that the home will perform as one expects it to. If it does not, then the homebuilder may be liable for the cost of repairs or other costs related to breaching the implied warranty of habitability. Implied warranties are generally not written, but exist because the law says that they do. According to the article, Illinois law states that an implied warranty of habitability may last up to 14 years. Thus, if a homeowner finds a defect within that time period that could not have been discovered during a home inspection, there may be grounds to hold the homebuilder liable for that defect. This implied warranty may also pass from one homeowner to another during the period of time in which it can be legally in effect.

Understanding the Court’s Decision

Since the original purchaser of the home in question waived their right to the implied warranty provided under state law, the court basically decided that it would be unfair for a subsequent owner to then be able to invoke the implied warranty. Allowing subsequent owners, whether such owners were aware of the waiver of an implied warranty or not, to then sue based on such implied warranty put homebuilders at a disadvantage, especially since homebuilders factor in the cost of their potential liability to the sale price of a home. Allowing plaintiffs to pursue lawsuits based on an implied warranty that has been waived would prohibit homebuilders from adequate protection under the law, and risks forcing homebuilders to raise prices on newly built homes beyond the reach of thousands of Illinois residents. The outcome of this particular case basically states that it would be unfair to allow subsequent owners of a property to revive warranties that may have been waived in the past, especially when such waiver may have been factored into the original price of the property.

Finding Legal Assistance

Product liability complaints come in many forms. They may involve houses, vehicles, or everyday products around your home that can cause serious financial loss or physical harm. When a person is injured by one of these products, it is important to understand the rights the law provides for the injured party to seek compensation from the manufacturer and/or seller of that product. If you have been injured by a product that has not performed the way it was supposed to or the way you expected it to, contact the attorneys at Levin & Perconti to schedule a consultation about the circumstances surrounding your claim.

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