Florida Supreme Court Issues HOA Ruling

TALLAHASSEE, Fla. – Dec. 16, 2013:

A Florida Supreme Court ruling applies to developers of home communities. The core issue focused on the responsibility a developer has down the road if problems arise in “essential services,” such as roads or sewer systems.

The Lakeview Homeowners Association in Central Florida alleged construction defects in the development’s subdivision against Maronda Homes after the homeowners association (HOA) assumed control. It alleged a “breach of the implied warranties of fitness and merchantability in the residential construction context.” The specific complaint: bad stormwater drainage that flooded driveways along with other problems.

The HOA filed a lawsuit claiming the problems were latent and could not easily be discovered by homebuyers.

Maronda argued that “common law implied warranties of fitness and merchantability” don’t include a community’s infrastructure – items beyond the home itself. If so, the builder said, it wasn’t responsible for things like retention ponds, private roads, underground pipes, etc.

A trial court agreed with Maronda; an appeal court did not. That took the case to the Florida Supreme Court.

The key issue before the Supreme Court was whether it should extend buyer protections beyond a home itself via an implied warranty. In the end, the Florida Supreme Court upheld the appeal court decision that Maronda did have some responsibility for community infrastructure.

For homebuyers, this means an “implied warranty of fitness and merchantability” now extends beyond their new home in some cases to the surrounding roads, sewer systems, and other infrastructure built by the community developer.

Courtesy Florida Realtors