Hoagland v. Celebrity Homes, Inc., 77-147

• Decision Date: 17 November 1977
• Docket Number: No. 77-147,77-147
• Citation: 572 P.2d 493,40 Colo.App. 215
• Parties: Melvin R. HOAGLAND, Jr., and Arlene S. Hoagland, Plaintiffs-Appellees, v. CELEBRITY HOMES, INC., a Delaware Corporation, Defendant-Appellant. . I
• Court: Colorado Court of Appeals

Page 493

572 P.2d 493

40 Colo.App. 215

Melvin R. HOAGLAND, Jr., and Arlene S. Hoagland, Plaintiffs-Appellees, v. CELEBRITY HOMES, INC., a Delaware Corporation, Defendant-Appellant.

No. 77-147.

Colorado Court of Appeals, Div. I.

Nov. 17, 1977.

Anthony V. Zarlengo, P. C., Anthony V. Zarlengo, Denver, for plaintiffs-appellees.

Clanahan, Tanner, Downing & Knowlton, Thomas C. McGee, Denver, for defendant-appellant.

COYTE, Judge.

Defendant, vendor of a house which it had constructed for the plaintiffs, appeals the award to the plaintiffs of damages, costs, and expenses for breach of the builder's implied warranty of workmanlike construction. We affirm.

The parties signed a purchase contract February 14, 1973, and signed a "Letter of Warranty Re: Structural Fitness of House" on October 15, 1973, the date the buyers took possession. After numerous discussions with defendant's employees and several letters and reports from plaintiffs' engineer and lawyer, suit was brought in July 1975.

The defendant argues that the letter of warranty the parties executed limits its liability to the plaintiffs by excluding the builder's common law implied warranty of habitability and workmanlike construction. This argument fails for several reasons.

First, by its terms the letter of warranty deals only with structural fitness of the house, but the trial court based its order on breaches of the implied warranty of workmanlike construction as well as suitability of habitation. A warranty of structural fitness is not co-extensive with the two common law warranties. Secondly, the letter of warranty contains no words of limitation that would indicate the intention of the builder to abrogate or limit his common law implied warranties. While an "as is" contract may operate to limit an implied warranty, see Tibbitts v. Openshaw, 18 Utah 2d 442, 425 P.2d 160, this letter does not indicate through using restrictive language that it is intended to release the builder from liability on its implied warranties. Liability in the letter of warranty is limited to the original owner, and acts of God, fire, theft, buyers' negligence or damages covered by insurance are all excluded.

In addition, this letter of warranty is either a unilateral modification to the purchase contract or a unilateral effort on the builder's part, without consideration, to limit its liability. Generally, a modification to a contract requires consideration, H. & W. Paving Co. v. Asphalt Paving Co., 147 Colo. 506, 364 P.2d 185, and accordingly, the builder may not be released from its common law liability simply by offering, on its own volition, another non-exclusive warranty. See Cohen v. Vivian, ...