In this disрute arising out of a residential fire allegedly caused by poor workmanship, defendant Foerster-Bolser Construction, Inc. (Foerster-Bolser), appeals as of right the May 27, 2004, judgment in favor of plaintiffs. We reverse and remand for further proceedings.
In 1997, while still residents of Maryland, plaintiffs Larry Smith and Corliss Smith hired Foerster-Bolser to construct a new residence on land the Smiths had purchased in Michigan for their eventual retirement. Foerster-Bolser gave the Smiths a certifiсate of occupation in October 1998. In June 1999, the Smiths retired and moved into the new home. Although the home was substantially completed at that time, there were several tasks that Foerster-Bolser still needed to perform to finalize the job.
Plaintiffs eventually filed suit against defendants, claiming they were responsible for the losses incurred as a result of the fire. Plaintiffs sought compensation under various theories, including negligence, breach of contract, and breach of implied warranty.
2
The jury trial commenced in April 2004. After the close of plaintiffs’ proofs, Runyan settled with plaintiffs and was dismissed from the case.
3
Thereafter, the trial court granted a directed verdict in favor of plaintiffs with respect to plaintiffs’ claim that defendant violated the implied warrаnty of habitability that accompanies the construction of all new homes. After the trial court
On appeal, defendant argues the trial court erred when it granted a directеd verdict in favor of plaintiffs on their claim for breach of the implied warranty of habitability. Specifically, defendant contends that the implied warranty of habitability only applies to new homes sold as part of a real estate transaction by builder-vendors. We agree.
As a preliminary matter, we note that defendant raised this argument for the first time on appeal. Although this Court need not review issues raised for the first time on appeal,
Herald Co, Inc v Kalamazoo,
This Court reviews de novo a trial court’s decision regarding a party’s motion for a directed verdict.
Elezovic v Ford Motor Co,
In
Weeks v Slavik Builders, Inc,
In examining the continuing validity of the doctrine, the Court recognized that, although the doctrine of implied warranty of fitness had replaced that of
caveat emptor
in the field of personal property, the doctrine of
caveat emptor
had continued to be almost universally applied to the sale of real property.
Id.
However, the
“When a vendee buys a development house from an advertised model, as in a Levitt or in a comparable project, he clearly relies on the skill of the developer and on its implied representation that the house will be erected in reasonably workmanlike manner and will be rеasonably fit for habitation. He has no architect or other professional adviser of his own, he has no real competency to inspect on his own, his actual examination is, in the nature of things, largely superficial, and his opportunity for obtaining meaningful protective changes in the conveyancing documents prepared by the builder vendor is negligible. If there is improper construction such as defective heating system or a defective сeiling, stairway and the like, the well-being of the vendee and others is endangered and serious injury is foreseeable. The public interest dictates that if such injury does result from defective construction, its cost should be borne by the respоnsible developer who created the danger and who is in the better economic position to bear the loss rather than by the injured party who justifiably relied on the developer’s skill and implied representation.” [Weeks, supra at 626-627, quoting Schipper, supra at 91.]
As can be seen, the underlying rationale in
Weeks
for adopting an implied warranty of habitability was to protect new home purchases from the harshness оf the
caveat emptor
rule still applicable to real estate transactions. The Court further recognized that most new home buyers would not be in a position to effectively bargain for concessions from the builder-vendor of the home and that the builder-vendor would likely be in a better position to identify and correct latent defects in the new home. While the Court did not specifically state that the implied warranty of habitability applied only to new homes sold as part of a real estate transaction involving the builder-vendor, the underlying rationale and policy cited by the Court, as well as the references to developers and builder-vendors, indicates an intention that the doctrine aрply only to builder-vendors.
4
In addition, where, as here, the purchaser of a new home engages the services of a general contractor to construct
Having determined that the trial court’s grant of a directed verdict should be reversed, we need not address defendant’s remaining arguments on appeal. However, we agree with plaintiffs’ contention that it would be inequitable to grant defendant the relief it requested with this unpreserved argument without also reinstating the claims plaintiffs withdrew in reliance on the trial court’s directed verdict. Therefore, pursuant to
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
Notes
The Smiths were home when Runyan began to work, but elected to spend the night еlsewhere while Runyan completed the work.
Plaintiff Allstate Insurance Company sought compensation for the claims it paid to the Smiths, and the Smiths sought compensation for uninsured losses.
Hereinafter, “defendant” will be used to refer to defendant Foerster-Bolser.
This is consistent with the application of the implied warranty of habitability in other jurisdictions. See
Albrecht v Clifford,
436 Mass 706, 710-711;
See, e.g.,
Feaster v Hous,
Because it is not necessary to the resolution of this case, we leave it to later courts to define the full extent of the term “builder-vendor.”