{"id":1339,"date":"2013-02-19T08:17:01","date_gmt":"2013-02-19T15:17:01","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=1339"},"modified":"2013-02-14T15:17:52","modified_gmt":"2013-02-14T22:17:52","slug":"construction-defect-litigation-the-defenses","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/construction-defect-litigation-the-defenses\/","title":{"rendered":"Construction Defect Litigation: The Defenses"},"content":{"rendered":"<p>Wally Zimolong &#8211; February 4, 2013<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Last week, I gave an overview of the claims typically raised in a construction defect case.\u00a0 This week we look at the defenses that a defendant in a construction defect case can raise.\u00a0 Typically, there are three categories of defenses a defendant in a construction defect case may be able to raise:<\/p>\n<ul style=\"margin: 0px 0px 10px 30px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: none; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">\n<li style=\"margin: 0px 0px 5px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: disc;\">Contractual;<\/li>\n<li style=\"margin: 0px 0px 5px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: disc;\">Statutory; and<\/li>\n<li style=\"margin: 0px 0px 5px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: disc;\">Common Law.<\/li>\n<\/ul>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">1.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">Contractual Defenses.<\/span><\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">In my last post, I discussed how plaintiffs in construction defect cases should look to the contract documents when evaluating what claims to bring in a construction defect case. \u00a0The same contract documents that give rise to a construction defect case can provide defenses to construction defect claims.\u00a0 Three common contract clauses that can be used in defending a breach of contract claim in a construction defect case are:<\/p>\n<ul style=\"margin: 0px 0px 10px 30px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: none; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">\n<li style=\"margin: 0px 0px 5px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: disc;\">Express waiver of warranty;<\/li>\n<li style=\"margin: 0px 0px 5px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: disc;\">Integration; and<\/li>\n<li style=\"margin: 0px 0px 5px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; list-style: disc;\">Release.<\/li>\n<\/ul>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Waiver of Warranties.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Many states, including Pennsylvania, recognize an owner can waive the implied warranty of habitability and workmanship by contract. \u00a0For the waiver to be valid, courts usually require that the waiver be clear and unambiguous.\u00a0 Pennsylvania courts go a step further and require that the waiver\u00a0specifically\u00a0reference latent defects.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0Integration Clauses<\/strong>.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Plaintiffs in construction defect cases will sometime allege that they were fraudulently induced by the contractor based upon oral representations concerning the quality of construction.\u00a0 These representations do not appear in the contract documents.\u00a0 Integration clauses are clauses in contracts that state that terms in the written document represent the entire agreement and that no representations not contained in writing in the document are not part of the parties agreement.\u00a0 When these clauses exist in the contract, courts have dismissed claims that owners were fraudulently induced by a contractor\u2019s oral representations which do not appear in the written agreement.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0Release.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">A contract may also contain a release of claims against the contractor or developer.\u00a0 If properly worded, the release may be enforceable against claims brought by a plaintiff in a construction defect case.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">2.<\/strong>\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\"><span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">Statutory Defenses<\/span>.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0The Statute of Limitations.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Every state has a statute of limitations that bars claims brought a certain period of time after the injury giving rise to the claim occurs (or a claimant first learns of the injury).\u00a0 The length of time varies depending on the claim alleged.\u00a0 If a plaintiff in a construction defect case brings its claim outside the statute of limitations, the court can dismiss plaintiff\u2019s case.\u00a0 Because the statute of limitations begins to run from the date the plaintiff first knows or should have known about the damage, it is important to discover early on in the litigation when that occurred.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 The Statute of Repose.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Most states also have something known as statutes of repose.\u00a0 Statutes of repose bar all claims construction defect claims brought a certain period of time after the building was completed\u00a0<strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">regardless of when the plaintiff learns of the defect.\u00a0\u00a0<\/strong>In Pennsylvania, the statute of repose is twelve years\u00a0 Therefore, suppose a plaintiff first learns of a construction defect in December 2012, but the building was completed in 1995.\u00a0 If she filed her construction defect case in January 2013 she would be within the statute of limitation for whatever claim she brings, however, the statute of repose may bar her claim, notwithstanding the statute of limitations, because the building was completed more than 12 years before her claim.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">3.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">Common Law Defenses<\/span>.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 The Spearin Doctrine.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">The\u00a0<span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">Spearin<\/span>\u00a0Doctrine is one of the best defenses to a construction defect case for a contractor but is also one that is usually not raised.\u00a0 We have written about the Spearin Doctrine on this blog before.\u00a0 The doctrine gets its name from a 1918 United States Supreme Court decision\u00a0<span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">United States v. Spearin<\/span>, 248 U.S. 132 (1918), which held that a contractor will not be liable to an owner for loss or damage that results solely from defects in the plan, design or specifications provided to the contractor. Effectively,\u00a0<span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">Spearin<\/span>\u00a0created a doctrine where the owner impliedly warrants that the plans and specifications if followed will result in a function system. \u00a0Essentially,\u00a0<span style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; text-decoration: underline;\" data-mce-mark=\"1\">Spearin<\/span>\u00a0holds that if a contractor is required to build according to plans and specifications prepared by the owner (or the owners representative) then the contractor will not be responsible for the consequences of defects in the plan.\u00a0\u00a0 In other words, if the contractor builds it as he was told to by the architect and the design does not work, he is not liable for those defects.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\"><strong style=\"margin: 0px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 Economic Waste\/Betterment.<\/strong><\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Even without a defense barring plaintiff\u2019s claim, defendants in a construction defect case can often mitigate the damages plaintiff is entitled to recover under the dual theories of economic waste and betterment.\u00a0 Generally, the measure of damages in a construction defect case is the cost of completing or correcting the defective work.\u00a0 However, when the cost of completing or correcting the work is disproportionate to the probable loss in value to the injured party then damages will be measured by the difference between the market price that the property would have had without the defects and the market price of the property with the defects. This is known as economic waste.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">Betterment prevents an owner from receiving a windfall when repairing or replacing defective construction.\u00a0 Under the theory of betterment, an owner cannot recover the cost of any enhancement or improvement of the replacement work.\u00a0 In other words, the owner can only recover the cost of what he originally bargained for.<\/p>\n<p style=\"margin: 0px 0px 10px; padding: 0px; border: 0px; font: inherit; vertical-align: baseline; font-family: 'Lucida Grande', Verdana, sans-serif; line-height: 18.1875px; background-color: #ffffff; text-align: justify;\">\u00a0Next week, we will look at insurance coverage issues in construction defect cases.<\/p>\n<p><a href=\"http:\/\/www.supplementalconditions.com\/2013\/02\/construction-defect-litigation-the-defenses\/\">Construction Defect Attorney, Construction Defect Lawyer Philadelphia<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Wally Zimolong &#8211; February 4, 2013 Last week, I gave an overview of the claims typically raised in a construction defect case.\u00a0 This week we look at the defenses that a defendant in a construction defect case can raise.\u00a0 Typically, there are three categories of defenses a defendant in a construction defect case may be&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/construction-defect-litigation-the-defenses\/\">Continue reading <span class=\"screen-reader-text\">Construction Defect Litigation: The Defenses<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[4,172],"tags":[19,27],"class_list":["post-1339","post","type-post","status-publish","format-standard","hentry","category-construction-defects","category-construction-law-2","tag-construction-defects-2","tag-construction-law","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Construction Defect Litigation: The Defenses - Advise &amp; 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