Georgia New Home
Warranty Rights

Foundational Case Law

The Builder Vendor Distinction

The Holmes doctrine applies only to a builder vendor — a contractor who builds a home and then sells it. Georgia continues to follow caveat emptor for the resale of used homes. A homeowner reselling an existing dwelling is generally not a builder vendor and is not subject to the Holmes doctrine. This is a significant practical limitation that homeowners coming from states with broader new home warranty schemes often misunderstand.

Standard of Care, Latent Defects, and Subsequent Purchasers

The implied duty is to construct in a fit and workmanlike manner — the reasonable care, skill, and ability ordinarily employed by other competent builders. This is an ordinary negligence standard, not strict liability. Where defects are latent (not discoverable by reasonable inspection at closing), Georgia imposes the duty regardless of any merger by deed argument; patent defects are generally waived by closing.

Georgia case law recognizes the builder’s duty extends to subsequent purchasers because the latent defect affects them just as it affected the original buyer. However, subsequent purchasers typically must prove negligent construction rather than rely on a pure warranty theory, and the eight year statute of repose runs from the original substantial completion — not from any resale.

Disclaimers

Disclaimers in builder contracts are often enforced if clear and conspicuous, but courts will construe ambiguities against the builder. Per Holloman, conflicting handwritten or typed terms are construed in the homeowner’s favor over preprinted form language. Generic boilerplate disclaiming “all warranties express or implied” may be insufficient to override clear contractual promises about serviceability and habitability.

Damages

Cost of repair or diminution in fair market value — Georgia treats these as interchangeable measures. Cost of repair is permissible even where it exceeds diminution in value, provided the repair is not an absurd undertaking and is reasonably proportionate to the injury. Consequential damages are recoverable where reasonably foreseeable and not validly excluded by the limited warranty.

Who and What is Covered

• Dwelling (§ 8-2-36(6)) = single family house, duplex, or multifamily unit designed for residential use where title to each unit transfers (covers condos and cooperatives), plus appurtenant systems and improvements
• Construction defect (§ 8-2-36) takes its meaning from any written or express warranty; in the absence of a written warranty, it means a matter concerning the design, construction, or repair of a dwelling on which the homeowner has a complaint against a contractor
• Claimant = the homeowner or association asserting a construction defect
• Contractor = general contractors, subcontractors, suppliers, and design professionals

The Sequence

The § 9-3-51(c) Contract Carve Out and Fraud Tolling

Section 9-3-51(c) carves breach of contract and express warranty claims out of the eight year repose — written builder warranties that explicitly extend beyond eight years remain enforceable for their stated term. Counsel sometimes describes this as a “fraud exception,” but that is imprecise. Fraud does not extend the repose by statute; rather, fraudulent concealment can equitably estop the builder from asserting the repose defense. Counsel investigating an older defect should always probe whether the builder knew of the condition at the time of sale or closing.

A compliant pre suit demand letter under Georgia law should contain:

• Homeowner’s full legal name(s) and property address
• Date of substantial completion (critical — the § 9-3-30 four year clock runs from this date)
• Date the homeowner first noticed each defect
• Identification of the contractor by name and SLBRGC license number, plus any known subcontractors
• Reasonably detailed description of each defect, with location, nature, and observed symptoms — in detail sufficient to explain the nature of the defect and its results
• For each defect, the legal theory being asserted (implied warranty under Holmes v. Worthey, breach of written contract under § 9-3-24, negligence, FBPA, breach of express limited warranty)
• Any third party inspection report
• Express invocation of O.C.G.A. § 8-2-38, citing the 90 day Right to Repair notice period and the contractor’s 30 day response window
• If asserting an FBPA claim, a separate § 10-1-399(b) 30 day demand combined with the Right to Repair notice (separately captioned to preserve both procedures)
• A proposed inspection access protocol and reasonable dates
• Statement of the remedy sought and a dollar figure where known
• Reservation of all rights, including under the limited warranty, FBPA, and any contractual fee shifting provision
• Signature and certified mail tracking number
• Attached evidence appendix — photo log, defect schedule, communications log, inspection report

Evidence Preservation Checklist

• Request the certificate of occupancy and inspection records from the local building department to confirm the substantial completion date
• Dated, geotagged photographs and video of every defect, including progression over time
• Written log of every communication with the builder
• Retain all closing documents, builder contract (check for seal), change orders, plans, specs, marketing materials
• Obtain an independent third party inspection report
• Preserve physical evidence in place where feasible; do not undertake destructive testing before the contractor has been given an opportunity to inspect
• Notify the builder in writing before any destructive testing or repair
• Keep receipts for any mitigation or repair expenses
• Maintain a single chronological case file

State Licensing Board for Residential and General Contractors

Georgia licenses residential contractors for projects of $2,500 or more and general contractors for commercial projects of $100,000 or more under O.C.G.A. § 43-41-17. Contracts with an unlicensed contractor (where licensure was required) are unenforceable by the contractor at law or in equity — the homeowner can still sue the unlicensed contractor for defective work, but the contractor cannot collect on the contract or pursue mechanic’s liens.

• License lookup and complaint filing: sos.ga.gov SLBRGC
• Administrative outcomes only — reprimand, civil penalty, suspension, or revocation. The Board cannot order monetary damages or compel repairs.

Georgia Department of Law — Consumer Protection Division

The Consumer Protection Division enforces the Fair Business Practices Act and handles consumer complaints, including against builders for deceptive practices. The Division does not litigate individual disputes but tracks patterns and may pursue enforcement actions.

• Online complaint and consumer information: consumer.georgia.gov
• Right to Repair Act overview: consumer.georgia.gov — Right to Repair Act

Fair Business Practices Act (FBPA) — § 10-1-390 et seq.

• Pre suit notice (§ 10-1-399(b)): at least 30 days before filing, send a written demand for relief identifying the claimant, reasonably describing the unfair or deceptive act, and the injury suffered. The defendant has 30 days to make a written settlement offer. Rejection of a reasonable offer can cap the homeowner’s attorney’s fees recovery.
• Damages: actual damages; treble damages for intentional violations; mandatory reasonable attorney’s fees and litigation expenses upon a finding of violation.
• Limitations: 2 years (§ 10-1-401) from the date the person knew or should have known of the violation.

Local Building Code Enforcement

Permits and inspections are administered at the local (city or county) level under the Georgia State Minimum Standard Codes (International Residential Code with Georgia amendments). The 2024 and 2026 IRC adoptions took effect at staggered dates statewide. Code violation complaints to the local building department can trigger reinspection, stop work orders, or certificate of occupancy revocation.

Industry & Mediation Channels

• Greater Atlanta Home Builders Association: atlantahomebuilders.com. Local chapters statewide. Generally do not run binding dispute resolution programs but may provide informal mediation referrals.
• Better Business Bureau: bbb.org/file-a-complaint. Non binding complaint and mediation services.

Court Jurisdiction

Venue is generally the county where the defendant resides or, for actions involving title to land, the county where the property sits.

This is a general sequencing template, not a fixed timeline. Specific deadlines depend on the date of substantial completion, the date the homeowner first noticed each defect, and the terms of any limited warranty.

1. Georgia does NOT apply a discovery rule to property damage construction defects under O.C.G.A. § 9-3-30. The 4 year clock starts at substantial completion. A latent defect discovered in year 5 is already barred under the tort theory unless the homeowner can plead within the 6 year written contract window, the § 9-3-51(b) discovery extension (only in years 7 and 8), or fraudulent concealment. Synthetic siding under § 9-3-30(b) is the only statutory exception.
2. Georgia has NO state contractor recovery fund. The SLBRGC imposes administrative discipline only. The civil lawsuit is the only meaningful path to monetary recovery. Surprises homeowners coming from Florida, Alabama, or other states with state administered funds.
3. The Holmes v. Worthey implied warranty applies only to builder vendors of newly constructed homes. Caveat emptor remains the rule for resale of used homes. Subsequent purchasers must typically prove negligent construction, not rely on a pure warranty theory.
4. The 8 year statute of repose applies to property damage and personal injury as well as design and construction deficiencies. The 7th/8th year discovery extension gives 2 years from injury but the total period cannot exceed 10 years. Section 9-3-51(c) preserves contract and express warranty claims for their written term. Fraudulent concealment can defeat the repose through equitable estoppel — but counsel should not rely on a “fraud exception” as a statutory matter.
5. Right to Repair Act non-compliance generally produces a stay or dismissal without prejudice — not a permanent bar — but the limitations clock does not stop running during the cure. Skipping the 90 day notice is practically dangerous even if not legally fatal.
6. FBPA applies to new home transactions where deceptive practices are alleged (Tiismann, 2006). Treble damages are available for intentional violations and attorney’s fees are mandatory upon a finding of violation — but the 2 year limitations period under § 10-1-401 is short.
7. Sealed contracts carry a 20 year limitations period under § 9-3-23. Most modern builder contracts are not sealed, but the homeowner should check — a sealed contract is a meaningful advantage.
8. Unlicensed contractor contracts are unenforceable under § 43-41-17(b) where licensure was required. The homeowner can still sue the unlicensed contractor for defective work; the contractor cannot collect on the contract or pursue mechanic’s liens.
9. Disclaimers in builder contracts are often enforced if clear and conspicuous, but ambiguities are construed against the builder. Conflicting handwritten or typed terms are construed in the homeowner’s favor over preprinted form language (Holloman v. D.R. Horton).
10. The Supreme Court caption on review is Worthey v. Holmes, with the parties reversed. Both forms appear in practitioner materials; the substantive holding is unchanged.