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Legal Lines: September 2018
18 Sep 2018 -

Question: A home warranty was agreed to in the Purchase and Sale Agreement. The Warranty fee was overlooked by all parties on the Settlement Statement and not paid. The Warranty would have expired one year past the date of closing. Upon notifying the Seller of this oversight just weeks before the home warranty would have expired, the Seller will not agree to pay for the Warranty. Will the Seller be liable for the costs of any repairs of those items that would have been covered by the Warranty up until the expiration?

Answer: There is a case in Georgia involving a termite letter where in the purchase and sale contract, the seller was supposed to provide a "clean" termite letter to the buyer at closing. For whatever reason, the required termite letter was not provided. The new buyers discovered termite damage and sued the seller to get him to provide the agreed upon termite letter. The buyers knew that the termite letter would not be able to be issued without the seller also paying to fix the termite damage. The Georgia Court of Appeals ruled that the buyer waived any seller obligations that were not fulfilled at closing and that the same did not survive the closing. Based upon that case, if the buyer did not get the agreed upon warranty at closing, I do not think the buyer has a good claim to get it now or to be able to bring a breach of warranty claim against the seller if there is a warranty issue in the next year.

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