Opinion ID: 1995721
Heading Depth: 3
Heading Rank: 2

Heading: Unit Owners

Text: In affirming dismissal of the Unit Owners' warranty claims the Court of Special Appeals reasoned that Title 10 warranties had not applied to condominiums until July 1, 1981, and that the enactment of § 11-131(a) first made §§ 10-202 and 10-203 applicable to sales by condominium developers. From this the court concluded that the one year limit on suit, measured from the end of the warranty period as provided by § 11-131(d), also applied to the warranty provisions incorporated into Title 11 from Title 10. That premise was faulty. In Starfish Condominium Association v. Yorkridge Service Corp., 295 Md. 693, 458 A.2d 805 (1983), we held that the Title 10 warranties applied to purchases of condominium units which were newly constructed private dwellings and which had been sold before Title 11 was enacted.
Section 10-204(b) measures the one year warranty under Title 10 from different starting times, depending on whether the subject unit was completed or not at the time of delivery of the deed. Here no Unit Owner has alleged closing on a unit which was not then completed. Consequently, § 10-204(b)(1) governs and the one year warranty runs from the earlier of the delivery of the deed or the taking of possession by the purchaser. The complaint does not advise when particular Unit Owners discovered the alleged defects and we have seen that, under the allegations, discovery by one or more unspecified Unit Owners might have been as late as May 6, 1980. Section 10-204(c), however, commences its two year limitations period with the earlier of discovery or the expiration of the warranty period. Working backwards from September 24, 1981, as the date of filing, the earliest date on which the two year limitations period could have started and the one year warranty period could have ended was September 23, 1979. Thus September 22, 1978, was the earliest date on which a deed could have been delivered to a Unit Owner who sued on September 24, 1981, without having that owner barred by limitations calculable from the face of the complaint. Similarly the earliest date of closing for a Unit Owner who first sued on November 23, 1981, would be November 21, 1978. Applying those outside dates, we reverse the affirmance of the dismissal of, and shall order remand as to, counts six, eight, ten, twenty-two, thirty-eight, forty-two, fifty-four, sixty, sixty-two, sixty-six, eighty-two, and eighty-four. [9] The complaint alleges that the ¶ 12 defects were discovered by September 18, 1978. Count four is the claim of Unit Owners based on warranty theories for the ¶ 12 defects. As to the Title 10 warranties the limitations period of two years begins with discovery and therefore expired before suit was instituted. Dismissal of count four is affirmed. Plaintiffs do not contest the affirmance of the dismissal, on limitations grounds, of claims by Unit Owners based on Title 11 warranties. It is appropriate to discuss at this point the first promise argument which the Plaintiffs base on either or both of two features in the standard contract of sale used at Antigua. Therein Melba represented that [t]he building ... conforms substantially to the construction plans and specification.... The Repair Clause reads that the unit being sold has been or is being constructed substantially in accordance with the construction evidence [ sic ] that Seller has fully complied with all its obligations hereunder.... Plaintiffs argue that limitations do not begin to run on an action for breach of this first promise in the Repair Clause until the defect is discovered so that a Unit Owner has three years thereafter within which to file suit. Under that construction of the Repair Clause it contains a written ... promise which relates to the improvement and is made a part of the basis of the bargain between the vendor and the purchaser [which] creates an express warranty that the improvement conforms to the ... promise. RP § 10-202(a)(1). Limitations on an action for breach of the first promise would not be governed by the general statute of limitations but by the special statute applicable to an express warranty under Title 10. The legal effect of dividing the Repair Clause into two promises, the first of which is no more than an express warranty, would be identical with the result in this Part II. C. 2. b.