My friend and law partner Matt Gardner has an excellent summary on Sullivan & Ward’s Iowa Law Blog about the crushing blow handed down to home builders this past Friday by the Iowa Supreme Court.
The ruling holds builders responsible to subsequent owners for defective conditions. The old law was caveat emptor or "buyer beware". The Court noted that public policy justifications support further erosion of the doctrine of caveat emptor. The purpose of the rule is to ensure that innocent home buyers are protected from latent defects. The court said subsequent purchasers are in no better position to discover those defects than the original purchaser. "Builders should be accountable for their work" quoted the court.
The new law might become known as the Home Builders’ Attorneys Equal Employment Act (HBAEEA). It seems inevitable more lawsuits will occur against builders because of the Court’s interpretation. Great if you are a homeowner but very bad for builders.
Read the full opinion here.