When Does The Warranty Period Commence in Construction?

In Louisiana, contractors provide certain warranties to their customers regarding the quality of their work.  These warranties include the Louisiana New Home Warranty which was enacted relatively recently to protect consumers from contractor errors.  Since these guarantee and warranty periods are time sensitive, it is important to know when they begin.

Louisiana Construction Warranties

Louisiana is home to what’s commonly referred to as “Napoleonic Code” which is infamous for being different than the other 49 “common law” states.  The Louisiana Civil Code imposes certain warranties on contractors and workers which are known in common law as the implied warranty of workmanlike performance.  Louisiana Civil Code Article 2769 states:

If an undertaker fails to do the work he has contracted to do, or if he does not execute it in the manner and at the time he has agreed to do it, he shall be liable in damages for the losses that may ensue from his non-compliance with his contract.

Louisiana Civil Code Article 2762 provides that a designer or builder is liable for defects in buildings caused by deficient workmanship when the defect occurs within 5 years of the construction of wooden buildings and for 10 years from the construction of stone or brick buildings.  Louisiana courts have consistently held that Article 2762 creates an implied warranty in every building contract “that the work of the contractor is to be performed in a good, workmanlike manner, free from defects in either material or workmanship.

In layman’s terms, if a contractor fails to deliver what he promised that he would, or on time, he is liable for the damages that may ensue from his failure or delay.  So, when does this warranty begin to run?

Warranties Commence on the Earlier of Substantial Completion and Owner Occupancy

Louisiana Revised Statute §9:2774, provides the following:

1. The guarantee and warranty period of all construction contracts shall commence on the date certified by the architect or engineer as the date the prime contract(s) has (have) been substantially completed in accordance with plans and specifications, or beneficially used by the owner, whichever first occurs.
2. The provisions of this Section shall not be subject to waiver by contract.

In construction law, substantial completion can be a fickle concept. However, it is traditionally held that the date of substantial completion is the date certified by the Owner when construction is sufficiently complete in accordance with the contract documents so that the Owner can occupy or utilize the construction for the reason that it was built.  However, as seen in the above-referenced statute, the date can be a moving target depending on the owner’s early occupancy and use of the construction.

Therefore, according to Louisiana law, these warranties against defects begin to run upon the earlier of substantial completion of the project or the owner’s occupancy and use of the object of the construction contract.

Should you have any questions or you would like to discuss this issue in further detail, please do not hesitate to contact us to schedule a free consultation.