Modular Housing Litigation

Modular homes are a cost effective alternative to stick built housing. They are prefabricated in a factory setting, in units of boxes. Depending on the home size desired, the house can consist of from three to ten boxes or more. Because a modular home is manufactured under controlled conditions, there is more of an opportunity for quality control. There are many different options that can be ordered for a modular home.

The factory usually will not sell directly to the homeowner. Typically, the homeowner will retain a contractor to whom the modular home will be sold. Or if a developer owns the land, s/he will order the modular home from the factory, and then sell the completed home to a buyer.

The first step is that the land needs to be prepared pursuant to the factory’s requirements and local ordinances. This typically means grading and the installation of footings and a foundation. It is critical that the mason understands that the modular units need to sync up perfectly with the top of the foundation. Otherwise, the home installation can be a disaster.

The contractor will arrange for a set crew and crane. When the modular units are shipped to the site, the crane will lift them off the flatbed truck and set them on the foundation. The contractor will be busy with the assembly of the units. Typically, there are ship loose items sent with the boxes which the contractor must also install.

The homeowner must obtain a copy of the contractor’s insurance and review it to confirm that construction errors and omissions are covered by his policy. It is also recommended that an attorney be consulted to review the contractor agreement before it is signed.

I represented a modular home manufacturer for over ten years in the defense of homeowner lawsuits. In 99% of the instances, it was contractor error (and not factory defect) that was to blame. Although the factory does not have a direct contractual relationship with the homeowner, that may not stop the homeowner from suing the factory on a number of theories, including breach of warranty and consumer fraud.

It may be necessary to sue the contractor and the factory if defects are not corrected voluntarily. It is critical that a homeowner retain a construction expert who is experienced with modular homes to determine who is at fault for any problems. Hiring an attorney with similar experience is also advisable.

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