Construction Defects and Minnesota’s Statute of Limitations: When Can Owners Sue GCs?

If you’re a construction professional reading this, you won’t be surprised to hear that Minnesota has strict residential building codes. Whether you think the increased regulations are a thorn in your side, a hindrance to your bottom line, or help to improve the quality of work done by Minnesota construction professionals, the bottom line is that they are strict and enforced. As a general contractor in Minnesota, you do only the best work possible. You abide by the state’s building codes, maintain up-to-date licensure, and exclusively hire others who do the same — yet you may still find yourself liable in the event that a customer levels a construction defect claim. In this blog, the team at MNCLS explores Minnesota’s statute of limitations as well as how contractors can protect themselves from construction defect claims. Keep reading to arm yourself with knowledge that can save your business, your livelihood, and your sanity. What Constitutes a Construction Defect Construction defects come in all shapes and sizes. Some might be so glaring that you scratch your head and wonder how you could’ve possibly let that slide, others might be so stealthy and insidious that they don’t reveal themselves for years, and many are just a fist-shaped hole in the drywall that a client is trying to pass off as your mistake. Typically, however, construction defects emerge as a result of noncompliance with Minnesota building standards — with major defects being those that impact the load-bearing capacity of the structure. Understanding Minnesota’s Statute of Limitations Minnesota’s statute of limitations for construction defects is a very tricky subject, and many contractors misunderstand Minnesota’s 1, 2, and 10 year warranty statute for homeowners looking to level claims. Homeowners must give you written notice within six months of discovering the alleged defect. This requirement is soft, however, and customers can satisfy this requirement by proving that they provided the contractor with “actual notice” within that same period. Beyond this, Minnesota’s statute of limitations states that defects discovered more than 10 years after the completion of construction can not be litigated, and — more importantly — the customer must pursue litigation no more than two years after the discovery. While there are a number of ways to protect yourself from litigation as a result of construction defects, timing might end up being your best defense. Protecting Yourself From Construction Defects While Minnesota’s statute of limitations is a strong defense, there are other ways general contractors can protect themselves against construction defect claims. Be Attentive, Responsive, and Reasonable When it comes to defect claims, a little customer service can go a long way. Litigation is far from the best-case scenario, and encouraging customers to reach out to you directly to resolve any issues can prevent the fallout of a defect claim. Homeownership — particularly in today’s housing market — can be a high-stress undertaking, and being empathetic toward your customer’s situation can prevent the issue from becoming litigious. DON’T IGNORE any written notice from a homeowner, as Minnesota law only gives contractors 30 days from the notification date to inspect. Take Notes Receiving notice of potentially defective work is never fun, and general contractors can become frantic trying to navigate the next steps. By carefully documenting this process — including all correspondence from clients — you can protect yourself in the event of litigation. Due to Minnesota’s statute of limitations, logging the timing of these complaints is of utmost importance. So, like the “A” student you were, be sure to take plenty of notes and lots of photos for all defect reports from clients. Minnesota’s Right to Repair In business relationships, there’s an unspoken agreement that both parties will behave reasonably. In the event that a client or customer does not abide by this agreement and instead rattles off unreasonable demands, Minnesota’s “Right to Repair” may serve as a valuable defense. If a homeowner fails to notify the general contractor of a defect less than six months from the date of discovery or does not allow an inspection within 30 days, the Right to Repair can serve as a strong defense for general contractors facing defect claims. MNCLS: Trusted Advisors to Minnesota Construction Professionals Understanding Minnesota’s statute of limitations can be difficult, and having the guidance of attorneys who have been in your shoes can be a life — and livelihood — saver. MNCLS serves as trusted advisors to countless Minnesota construction professionals, and are the attorneys contractors call when they need Minnesota’s laws to work for them.