Lyon v. Ward

221 S.E.2d 727 (1976) 28 N.C. App. 446

Ronald W. LYON and wife, Judith M. Lyon, Plaintiffs,
v.
Jim WARD, t/a Jim Ward Construction Company, Defendant and Third-Party Plaintiff,
v.
BAINBRIDGE AND DANCE WELL DRILLING CONTRACTORS, INC., Third-Party Defendant.

No. 7518DC717.

Court of Appeals of North Carolina.

February 4, 1976.

Smith, Patterson, Follin, Curtis & James by Norman B. Smith, Greensboro, for plaintiff-appellee.

Frassinetti & Shaw by Eugene G. Shaw, Jr., Greensboro, for defendant, Jim Ward, appellant.

No counsel for third-party defendant, Bainbridge & Dance Well Drilling Contractors, Inc.

HEDRICK, Judge.

The principal question presented by this appeal is whether the builder-vendor, Jim Ward, impliedly warranted to the initial purchasers that the well constructed on the premises by him and sold as an integral part of the house would provide an adequate, usable water supply for the house.

In Hartley v. Ballou, 286 N.C. 51, 209 S.E.2d 776 (1974), Chief Justice Bobbitt said:

"[W]e hold that in every contract for the sale of a recently completed dwelling, and in every contract for the sale of a dwelling then under construction, the vendor, if he be in the business of building such dwellings, shall be held to impliedly warrant to the initial vendee that, at the time of the passing of the deed or the taking of possession by the initial vendee (whichever first occurs), the dwelling, together with all its fixtures, is sufficiently free from major structural defects, and is constructed in a workmanlike manner, so as to meet the standard of workmanlike quality then prevailing at the time and place of construction; and that this implied warranty in the contract of sale survives the passing of the deed or the taking of possession by the initial vendee." Id. at 62, 209 S.E.2d at 783.

In Hartley, there was no evidence that any part of the house was not constructed in a workmanlike manner or that it was not free from major structural defects other than the evidence that water seeped into the basement floor during normal weather conditions. Thus, we interpret Hartley to stand for the proposition that a builder-vendor impliedly warrants to the initial purchaser that a house and all its fixtures will provide the service or protection for which it was intended under normal use and conditions.

Justice Copeland, speaking for the Supreme Court in Hinson v. Jefferson, 287 N.C. 422, 215 S.E.2d 102 (1975), said: "The basic and underlying principle of Hartley is a recognition that in some situations the rigid common law maxim of caveat emptor is inequitable." Id. at 435, 215 S.E.2d at 111. In relaxing the rule of caveat emptor, North Carolina has followed the developing trend in the United States which recognizes that there ought to be an implicit understanding of the parties when an agreed price is paid that the home is reasonably fit for the purpose for which it is to be used. Tavares v. Horstman, 542 P.2d 1275 (Wyo. Sup.Ct.1975); see also Humber v. Morton, 426 S.W.2d 554 (Tex.1968); Bethlahmy v. Bechtel, 91 Idaho 55, 415 P.2d 698 (1966); Schipper v. Levitt & Son's, Inc., 44 N.J. 70, 207 A.2d 314 (1965); Carpenter v. Donohoe, 154 Colo. 78, 388 P.2d 399 (1964); McKeever v. Mercaldo, 3 Pa.D. & C.2d 188 (1954); and see, 25 A.L.R. 3d 383 (1969) and authorities cited therein. As said in Humber v. Morton, supra at 562, "The caveat emptor rule as applied to new houses is an anachronism patently out of harmony with modern home buying practices. It does a disservice not only to the ordinary prudent purchaser but to the industry itself by lending encouragement to the unscrupulous, fly-by-night operator and purveyor of shoddy work."

Because an adequate supply of usable water is an absolute essential utility to a dwelling house, we believe that the initial purchaser of a house from the builder-vendor can reasonably expect that a well constructed on the premises by the builder-vendor will provide an adequate supply of usable water. We hold that at the time of the passing of the deed or the taking of possession the builder-vendor of a house impliedly warrants to the initial purchaser that a well constructed on the premises by him will provide water for the dwelling house which is adequate and usable. In the record before us, there is sufficient evidence to support the finding that the defendant owned the lot upon which he built the house and the well which he sold to the plaintiffs and that the well did not provide an adequate and usable supply of water for the house under normal use and conditions. These findings support the conclusion that the defendant as a builder-vendor breached his implied warranty that the well would provide adequate water for the plaintiffs, and the plaintiffs are entitled to damages for such breach.

The defendant also excepts to the court's conclusion that the "[t]hird party defendant did not have a contract with defendant, and had no other legal duty to defendant, to insure a water supply of any particular quantity or quality". The contract which was introduced into evidence shows clearly there was no express contractual responsibility for Bainbridge to provide an adequate supply of water. Indeed, as between Bainbridge and Ward, it was understood that the area was a "high risk area" and there was no guarantee that the well would produce water at all. The expectations of a builder-vendor who subcontracts the work of drilling a well are entirely different from the expectations of a prospective home purchaser. The court's finding of fact that there was no guarantee of water by Bainbridge to Ward is supported by the evidence in the record. Accordingly, this assignment of error is overruled.

Affirmed.

PARKER and ARNOLD, JJ., concur.