Enforceability Status
Warranty exclusion clauses in Colorado new construction contracts face notable constraints. Colorado's Construction Defect Action Reform Act (C.R.S. section 13-20-801 et seq.) establishes a pre-litigation process, and the Colorado New Home Buyers Protection Act (C.R.S. section 6-25-101 et seq.) imposes disclosure requirements. Colorado courts recognize implied warranties in new construction that cannot be entirely disclaimed.
Legal Analysis
Colorado's Construction Defect Action Reform Act (CDARA), C.R.S. § 13-20-801 et seq., establishes a mandatory notice-of-claim process for construction defect claims. Homeowners must provide the builder with written notice at least 75 days before filing suit, allowing the builder an opportunity to inspect and offer repairs.
The Colorado New Home Buyers Protection Act (C.R.S. § 6-25-101 et seq.) requires builders to provide buyers with specific warranty disclosures, including a description of the warranty coverage, exclusions, and the process for making warranty claims. Failure to comply with these disclosure requirements may affect the enforceability of warranty exclusions.
Colorado courts recognize an implied warranty of suitability in new home sales. In Carpenter v. Donohoe (1964), the Colorado Supreme Court established that builders of new homes impliedly warrant that the home is built in a workmanlike manner and suitable for habitation. Subsequent decisions have held that this implied warranty cannot be entirely disclaimed through contract terms.
HB 23-1121 (2023) significantly reformed construction defect litigation in Colorado, requiring property owners to demonstrate actual damages from construction defects. The law also modified requirements for HOA construction defect actions. Warranty exclusion clauses must be evaluated in light of these evolving statutory requirements.
Relevant Colorado Law
Establishes a mandatory 75-day notice-of-claim process for construction defect claims and sets standards for construction defect litigation.
Requires builders to provide specific warranty disclosures to buyers, including coverage, exclusions, and claims procedures.
Prohibits deceptive trade practices, which may apply to misleading warranty representations in builder contracts.
Related Cases
The Colorado Supreme Court established an implied warranty of suitability in new home sales, holding that builders warrant their homes are constructed in a workmanlike manner and suitable for habitation.
Builders in Colorado Using This Clause
What Colorado Buyers Should Know
- Review Required Warranty Disclosures Colorado law requires builders to provide specific written warranty disclosures before closing. Verify that you received all required disclosures and that the warranty exclusions match what was disclosed.
- Understand Colorado's Implied Warranty Protections Colorado recognizes an implied warranty of suitability in new construction that cannot be entirely disclaimed. Even if the builder's express warranty excludes certain items, you may have implied warranty rights for habitability-related defects.
- Follow CDARA Notice Requirements Colorado law requires at least 75 days' written notice to the builder before filing a construction defect lawsuit. Compliance with CDARA procedures is essential to preserving your legal rights.
- Check for Climate-Related Exclusions Colorado builder warranties commonly exclude damage from soil movement, altitude-related settling, freeze-thaw cycles, and wildfire exposure. These exclusions may cover conditions that are common in Colorado's climate.