Construction defect claims can lead to compounded risks

| Mar 26, 2021 | construction defects

Receiving complaints of a construction defect can be stressful.

Business owners often immediately think of the damage their reputation – and their business – could suffer in this situation. News of construction defects can certainly affect businesses, and reputational damage is a serious risk that business owners must take steps to prevent.

However, the legal risks businesses could face are one of the main reasons business owners must act fast to defend themselves against construction defect claims.

Why is it so important to act fast?

Owners of construction companies know how construction defect claims can jeopardize their business. However, it bears repeating that these claims often involve a series of other legal issues that multiply challenges and risks, including:

  • Breaches of contract, if the workmanship or resulting damage and defect goes against the terms laid out in the contract
  • Breaches of warranty, specifically if the defect goes against an express warranty or a guarantee regarding quality that the parties outlined in the contract
  • Negligence, if contractors of construction companies do not uphold the standard of care required of them under the law and the individual contract
  • Strict liability, which is only a risk for mass developers in California, but is a risk nonetheless

Business owners should make sure they do not overlook these additional risks that could make defect cases even more complex.

Critical steps to take against defect claims

As we have discussed in previous blog posts, California law provides an avenue for dispute-resolution before taking matters to court. Even so, business owners must take great care as they move forward to handle these claims.

If a construction defect claim is brought to their attention, business owners should:

  • Carefully review the claim to determine what other legal concerns they might face
  • Reevaluate the documents and records from that specific project
  • Seek legal advice regarding the options and obligations under California law

Many business owners might wish to respond to the claim as soon as possible to defend their reputation. And while it is critical to act quickly, owners must still act strategically.