Litigation

Homeowner may sue for negligent construction, Oregon Court of Appeals holds

By Lori Bauman

A homeowner who discovers construction defects may be unable to pursue the builder on a contract theory if too much time has passed and the statute of limitations has run.  And, even if the statute of limitations on a tort claim would be delayed by the homeowner's belated discovery of the defect, under the economic loss doctrine no negligence claim is available unless there is a "special relationship" between the builder and the homeowner.  (See our earlier discussion of the economic loss doctrine here.)  The lack of a special relationship associated with an ordinary construction contract typically makes it impossible for a homeowner to pursue a negligence claim.

But a panel of the Oregon Court of Appeals held earlier this month that an aggrieved homeowner may be able to pursue a negligence per se claim on the theory that the builder violated the Oregon Building Code.  In Abraham v. T. Henry Construction, Inc., the homeowners discovered the defects more than six years after construction, making a contract claim untimely under ORS 12.080(1).  The court observed that plaintiffs may nonetheless state a valid negligence claim it they can allege a breach of a standard independent of the terms of the contract.  Plaintiffs identified such a standard in the Building Code, and asserted that the purpose of that Code is to protect homeowners such as plaintiffs.  Based on the claim that the builder had caused damage to the home by violating the Building Code, the Oregon Court of Appeals reversed summary judgment for the builder and remanded the case for trial.

Full post as published by Northwest Business Litigation Blog on September 13, 2009 (boomark / email).