Legislative Changes Pertinent to the Construction Industry

Legislative Changes Pertinent to the Construction Industry

I wanted to take this opportunity to make you aware that the Minnesota legislature has again changed some of the laws applicable to the residential construction industry. As you know, new homes and improvements to homes come with statutory warranties under Minnesota Statute Section 327A. The legislature has revised the law and now it is required that the warranties "be set forth as written warranty instruments and must be included as part of the construction contract and conveyed to the owner." Minn. Stat. 327A.08(c). The warranties apply even if the written warranty is not provided to the owner. However, a failure to provide the warranty in writing may be grounds for a license sanction. The new law requires that the written warranties be included with contracts entered into on or after August 1, 2009.

The legislature also passed Minnesota Statute Section 337.10, Subd. 3 that requires prompt payment to any subcontractor or material supplier. Prompt payment is defined as within ten days of receipt of an invoice by the party responsible for payment for undisputed services. Interest of 1 ½ percent per month accrues if payment is not made on time. In addition "a party requesting payment who prevails in a civil action to collect interest penalties from a party responsible for payment must be awarded it costs and disbursements, including attorney fees incurred in bringing the action." This amendment also goes into effect on August 1, 2009.

For more information please contact Paul H. Grinde

DISCLAIMER:

This information has been prepared for general information purposes only. This information is not legal advice. Legal advice is dependant upon the specific circumstances of each situation. Laws not only vary from jurisdiction to jurisdiction, but also change frequently within a given jurisdiction. Therefore, this information cannot replace the advice of competent legal counsel in your state.