The Minnesota Legislature this year modified Minnesota Statutes Chapter 327A concerning statutory warranties that apply to all residential construction. Chapter 327A provides warranties for one year, two years or, in some circumstances, ten years on residential construction. The warranties are designed to protect homeowners from faulty or defective construction, workmanship and materials due to noncompliance with building standards.
The new law, which took effect on August 1, 2009, sets forth a three-part requirement regarding the 327A warranties. They "must be set forth as written warranty instruments and must be included as part of the construction contract and conveyed to the owner." Or, piece-by-piece, the new law requires: (1) the 327A warranties to be set forth in writing, (2) as part of the construction contract and (3) conveyed to the owner. Failure to comply with these requirements may subject the contractor to license sanctions. It is very important to note that the statute does not clarify whether "construction contract" means oral contract or written contract.
In addition, the new law also states that if the 327A warranties "are not provided to the owner in writing…they are implied statutory warranties that have the same effect as if the vendor or home improvement contractor had complied" with the three-part requirement. This clause appears to mean that if the contractor does not provide the 327A warranties in writing, the warranties still would be implied and the contractor still would be subject to sanctions.
These two clauses, found in the new Minn. Stat. § 327A.08(c) and (d), appear to require a contractor to provide the 327A warranties to the owner in writing, regardless of whether the contract is oral or written. Failure to provide the 327A warranties in writing to the owner would render the contractor liable for sanctions under Minn. Stat. § 326B.84.
Click here to read the language of the revised statute.