A recent Illinois Supreme Court decision eliminates consumer protection for homeowners seeking a financial remedy against subcontractors for defective construction that could potentially have ripple effects throughout Illinois. The Court found in Sienna Court Condo Association v. Champion Aluminum Corp. that purchasers of a new home cannot sue a subcontractor that has no contractual relationship with the purchaser. This decision overrules a previous decision that held that homebuyers could sue subcontractors for construction defects using an implied warranty of habitability claim against the subcontractor.
In Sienna, a lawsuit was filed against the general contractor, the developer, and several subcontractors. Many of the counts claimed breach of implied warranty of habitability based on construction defects that left many units unusable. Prior to the complaint being filed, the general contractor and developer declared bankruptcy and the subcontractors moved to dismiss, claiming they were not subject to the implied warranty of habitability claims. The top court in Illinois agreed with the subcontractors.
The Illinois Supreme Court’s decision will affect buyers, subcontractors, and general contractors. Buyers now have less pockets to recoup their damages; subcontractors may avoid certain lawsuits altogether; and general contractors will likely not be able to place any blame on subcontractors in these lawsuits. In other words, subcontractors are the big winners, while homeowners and general contractors will be left with the short end of the stick. If you have any questions or concerns about real estate or construction law, contact the attorneys at Rock Fusco & Connelly, LLC.