Mitigating Liability in Condo Developments: Warranties, Disclosure and Construction Claims

Recording of a 90-minute premium CLE video webinar with Q&A


Conducted on Thursday, February 25, 2021

Recorded event now available

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Program Materials

This CLE webinar will provide real estate counsel with guidance on anticipating unit owner and association claims in condominium developments and creating project documents and disclosures that will minimize litigation risk. The panel will address developing a fair and cooperative process with all design and development stakeholders to deal with likely claims and preemptively handle construction claims to avoid litigation and reduce costs.

Description

Condominiums and homeowners associations are unique in that the developer creates and funds an entity responsible for making claims against the developer. Both individual unit owners and the owners association have unique warranty rights that generally cannot be waived.

Today developers may invest in a condominium project because of market demand, economics (especially land costs), and the flexibility that the condominium form of ownership offers for mixed-use and complex projects. Although the mechanics of financing, designing, and constructing a condominium are the same as a multifamily rental or office building, the risks of liability are vastly higher. While the thought of doing a condominium development strikes fear in the hearts of some architects, general contractors, and developers, the risks can be managed by careful planning and execution, with appropriate attention to the unique facets of condominium development.

There are three main types of claims: (1) misrepresentation and fraud; (2) violating the condominium act disclosure provisions; and (3) statutory or contractual warranties. In turn, the statutory warranties come in at least two major forms: (1) Uniform Common Interest Ownership Act (UCIOA) (or Uniform Condominium Act) warranties derived from the Uniform Commercial Code provisions governing the sale of goods, and (2) structural defect warranties derived from state law governing defects in the sale of real estate.

Listen as our authoritative panel discusses the liabilities associated with condominium development and how to mitigate risk via compliance with disclosures and implied and express warranties. The panel will discuss best practices for all stakeholders in condominium development to address these risks.

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Outline

  1. Source of liability
  2. Statutory warranties
    1. Express
    2. Implied
  3. Risk management
  4. Disclosure documents
  5. Transition of management

Benefits

The panel will review these and other relevant topics:

  • What are the major types of liability claims likely to arise in condominium development?
  • How should real estate counsel handle misrepresentation and fraud claims related to condo projects?
  • What are best practices in developing condo disclosures to avoid future claims?
  • What implied and express warranties can be the form of construction defect claims in condominium development?
  • How can a developer handle the transition of management of condominium development to mitigate risk best?

Faculty

Diamond, Robert
Robert M. Diamond

Senior Counsel
Reed Smith

Mr. Diamond has practiced real property law in Virginia, Maryland and the District of Columbia for 38 years, with...  |  Read More

Dingman, Michael
Michael S. Dingman

Partner
Reed Smith

Mr. Dingman's practice focuses on representation of all entities in the construction and real estate industries...  |  Read More

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