November 23, 2014
Legal decision could mean more liability for developers

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The Florida Supreme Court ruled that a homeowners association can sue a developer for shoddy work on common area infrastructure.

Home Building

Legal decision could mean more liability for developers

Jerry Jackson | 10/22/2013

Developers and home builders throughout Florida face potential new legal liabilities for shoddy infrastructure work after a homeowners association in west Orange County won what is being called a landmark case before the Florida Supreme Court.

The Lakeview Reserve HOA took Maronda Homes of Florida to court in 2006 after residents complained of streets cracking, driveways sinking, storm drains collapsing, lawns eroding and retention ponds overflowing in the relatively new gated subdivision.

During the lengthy legal battle, evidence showed that the pipes and stormwater drainage for common areas were defective and failing. Maronda conceded as much, agreeing that potential flooding problems were an increasing threat to homes. But the builder-developer denied any financial responsibility for repairs to common areas, citing previous court decisions that basically had “drawn the line” of legal liability at the homeowners’ doors.

Homeowners in Lakeview Reserve did not cite or allege damage to their homes, and Maronda argued successfully before a lower court that since common areas had already been deeded to the HOA, the builder was not responsible for upkeep or repairs. Attorneys for Maronda said that because the homes remained habitable, the HOA could not claim an “implied warranty of habitability” was violated.

But the 5th District Court of Appeal sided with the HOA, and the Supreme Court upheld the ruling in July. Justices said that homeowners should not have to wait for their homes to flood or become literally uninhabitable before making a joint claim through their HOA. Homeowners, the court said, rely on the expertise of builder-developers to ensure that drainage and underground piping are properly designed and installed. As a result, the high court said, a warranty of habitability is implied, or else no certificates of occupancy would ever be issued for the homes.

Justices went even further, though, admonishing the Florida Legislature for passing a law in 2012 that tried to shield Maronda retroactively. The bill cited the Maronda case, which was ongoing at the time, and in effect adopted the builder’s argument that implied warranties did not extend to subdivision streets and storm drainage.

Tags: Central, Housing/Construction

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