IMPLIED WARRANTIES: ALMOST EVERYTHING YOU SHOULD KNOW ABOUT THEM!

The builder-vendor of a house impliedly warrants that the house was constructed in a good and workmanlike manner and is suitable for human habitation Humber v. Morton, 426 S.W.2d 554, 555 (Tex. 1968); Codner v. Arellano, 40 S.W.3d 666, 672 (Tex. App.—Austin 2001, no pet.) (implied warranty to perform services to repair or modify existing property in good and workman-like manner may also arise under common law if mandated by public policy). The warranty of habitability requires that a house be safe, sanitary, and otherwise fit for humans to inhabit. The warranty of good and workmanlike construction requires that the construction be done in a manner in which an ordinarily prudent person engaged in similar work would have performed under similar circumstances. The idea of a reasonable standard of skill and diligence is implicit in the good and workmanlike standard. See Miller v. Spencer, 732 S.W.2d 758, 760 (Tex. App.—Dallas 1987, no writ) (warranties described, but not applied)]. The implied warranties of good and workmanlike construction and habitability may not be waived or disclaimed Melody Home Mfg. Co. v. Barnes, 741 S.W.2d 349, 355 (Tex. 1987)(emphasis added).

Generally, the concept of good workmanship, as used in a construction contract, has a relative meaning, depending on the context in which it is used. Chappell Hill Bank v. Lane Bank Equip., 38 S.W.3d 237, 243 (Tex. App.—Texarkana 2001, pet. Denied). When the contract requires the work to be completed to the owner’s satisfaction, courts will generally apply an objective test to determine whether the party required to be satisfied acted in good faith Chappell Hill Bank 38 S.W.3d at 243.

These implied warranties are automatically assigned to a subsequent purchaser of the house Gupta v. Ritter Homes, Inc., 646 S.W.2d 168, 169 (Tex. 1983) (purchaser of used house has cause of action under Deceptive Trade Practices Act to recover damages for latent defects not discoverable by purchaser’s reasonably prudent inspection at time of sale)]. This is true even if the builder of the home was the first occupant March v. Thiery, 729 S.W.2d 889, 892 (Tex. App.—Corpus Christi 1987, no writ).

The implied warranty of good workmanship extends to partially completed houses, as long as it is clear what portion of the house has been fully constructed by the builder. This is because a builder/vendor who constructs a building for residential purposes impliedly warrants that whatever construction he or she has done has been done in a good and workmanlike manner. March v. Thiery, 729 S.W.2d 889, 893 (Tex. App.—Corpus Christi 1987, no writ) (rejecting builder’s contention that because house was only 25 percent completed, every phase of construction must be considered to be only 25 percent completed).

There is no implied warranty of good and workmanlike service or implied warranty of habitability from a subcontractor or materials supplier with whom the property owner had no direct contractual relationship. Pugh v. General Terrazzo Supplies, Inc., 243 S.W.3d 84, 89–90 (Tex. App.—Houston [1st Dist.] 2007, pet. filed). The owner’s remedy is against the general contractor. Pugh v. General Terrazzo Supplies, Inc., 243 S.W.3d 84, 90 (Tex. App.—Houston [1st Dist.] 2007, pet. filed).

In the absence of a provision in the contract to the contrary, the builder also implicitly covenants that the construction will comply with all relevant municipal and county codes applicable to the intended use of the property. Tips v. Hartland Developers, Inc., 961 S.W.2d 618, 621–623 (Tex. App.—San Antonio 1998, no pet.) (recognizing rule, but holding that parties agreed to address compliance with fire codes in later change orders due to uncertainty of use and possible destruction of surrounding buildings).

Texas courts generally apply the Spearin doctrine that the owner implicitly warrants to the contractor the sufficiency of the drawings and specifications. Shintech Inc. v. Group Constructors, Inc., 688 S.W.2d 144, 151 (Tex. App.—Houston [14th Dist.] 1985, no writ); see generally United States v. Spearin, 248 U.S. 132, 39 S. Ct. 59, 63 L. Ed. 166 (1918)].

It is also important to note that the implied warranty of merchantability does not apply to the construction and sale of a house. Haney v. Purcell Co., Inc., 796 S.W.2d 782, 786 (Tex. App.—Houston [1st Dist.] 1990, den.).

Should you have any questions regarding your next construction project or any construction dispute, please feel free to reach out to me at 832-930-0529 or info@kestephenslaw.com.

None of the information given here is intended to be legal advice and it should not be construed as such. Special Thanks to Mathew Bender and Company for the thorough information.

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