One of the most significant issues facing condominium unit purchasers is the extent of warranties given by the developer.
Condominium experts have predicted that warranty problems will be the most important consumer issue affecting condominiums during this decade.
Two kinds of warranties are available by law. "Express warranties" are those given the purchaser by the seller/developer. These warranties spell out the extent and scope of protection. Often these warranties, if given at all, are limited.
"Implied warranties," on the other hand, are those that are available whether or not the developer expressly gives them to the purchaser. In most states there is an implied warranty that the property conveyed is built in a professional manner and is fit for human habitation.
The new Maryland law clarifies the warranty for all condominiums built or converted after July 1, 1981.
The developer must warrant for a period of one year that he or she is responsible for correcting any defects in materials or workmanship in the construction of walls, ceilings, floors, and heating and air-conditioning systems in the unit. Additionally, the developer must warrant that heating and air-conditioning systems have been installed in accordance with acceptable industry standards and that:
The heating system must maintain a 70 degree Fahrenheit temperature inside when it is zero outside and winds do not exceed 15 miles per hour, and
The air-conditioning system must maintain a minimum 15 degree differential between the inside and outside temperatures.
These warranties apply to all individual units. Additionally, the new law provides an implied three-year warranty on the common elements of the condominium. This applies to the roof, foundation, external and supporting walls, mechanical, electrical and plumbing systems, and other structural elements.
The law requires that the warranty shall provide that the developer is responsible for correcting any defects in materials or workmanship and that the specified common elements are within acceptable industry standards in effect when the building was constructed. The three-year warranty on the common elements begins with the first transfer of title to a unit owner. If common elements are not completed at that time, the warranty begins with the completion of that common element or with its availability for use by all unit owners, whichever occurs later.
To ensure that warranties are in effect, unit owners must give written notice of defects within the one-year period. The condominium association must give notice within the three-year period.
A suit for enforcement of the warranty on the common elements can only be brought by the condominium association -- referred to as the Council of Unit Owners.
The law further provides that these implied warranties shall not apply to any defects caused through abuse or failure to perform maintenance by a unit owner or the Council of Unit Owners. This new implied warranty will provide condominium owners greater protection. The extent of the coverage, however, will depend on the willingness of unit owners (or the Council) to monitor the structural condition of the buildings during the warranty period.