The builder struggled with conflicting emotions and conflicting advice. The emotions ranged from anger and vulnerability to pride and a sense of obligation. The advice from his attorney was to say and do nothing. My advice was to knock on doors, talk to homeowners, and begin the process of repairing seven homes.
The problem began when his crews overlooked some installation details when they put windows in eight homes. One hostile homeowner had complained about air infiltration and some leaks. Upon investigation the builder discovered the original error and realized the same mistake would have been made in the other seven homes. Panic set in.
His lawyer recommended that he remain silent and just fix the problem when customers reported it. He cautioned that contacting them all at once could result in a class-action lawsuit, especially considering the adversarial attitude of the first homeowner.
Uncomfortable with that approach, the builder called me. Concerned about the effect of seven homeowners figuring out that the company knew about the problem and remained silent, we concluded that if a lawsuit did result, the builder would rather stand up in court and defend a proactive repair effort than sweeping this under the rug in hopes it would go away. In a damned-if-you-do, damned-if-you-don’t position, the builder decided he’d rather be damned on a high road than a low road. The company contacted all seven remaining homeowners, fixed the problem, did not experience a lawsuit, and got a referral that turned into another sale. The original homeowner remains hostile; the other seven are well satisfied.
This anecdote draws attention to a growing concern: the sometimes divergent positions of the legal mind and the service mind. One example that frequently comes up is whether it’s OK to recommend subcontractors to clients. I say of course it is, but industry lawyers often disagree. They say that under no circumstances should employees recommend a person, store, product, or method. The fear is that if problems result, the builder could be held responsible.
I always counter that the builder’s contract averts a lawsuit of this kind as long as it contains a clause stating that if a homeowner has another trade work on some aspect of the house, warranty coverage on the component in question is void.
Another builder wasn’t sure how to handle homeowners who want to submit warranty lists between the builder’s standard check points of 60 days and 11 months. The builder’s attorney was in favor of telling the homeowner he would need to wait until the next routine visit. In her view, the builder took on enough expense and risk offering two visits.
Again, I took an opposing view. Scheduling warranty checks is for everyone’s convenience—builder, homeowner, and trades. However, it should not impose an obstacle to service if the homeowner’s needs exceed the suggested schedule. Besides, again quoting a typical builder warranty clause, if the homeowner fails to report items in a timely manner, the warranty may again be void on the item and the repairs denied.
