ROBERTS, C.J., Associate Judge.
Lakeview Reserve Homeowners Association, Inc. ("the Association") appeals from the final summary judgment entered in favor of Maronda Homes, Inc. and T.D. Thomson Construction Company (collectively "the Developer")
The Developer developed a residential subdivision in Orange County, Florida, and incorporated the Association to serve as the homeowners association of that subdivision. In developing the subdivision, the Developer performed certain site work, including construction of the stormwater drainage system and private roadways. During construction of the subdivision, the Developer retained control of and managed the subdivision. Ultimately, the Developer transferred all control of the subdivision to the individual lot owners and the Association.
The Association filed a complaint against the Developer for breach of the implied warranties of fitness and merchantability based on latent defects in the subdivision's common areas. Specifically, it claimed that the roadways, retention ponds, underground pipes, and drainage systems throughout the subdivision were defectively constructed. The Developer filed a motion for summary judgment, arguing that the common law implied warranties of fitness and merchantability do not extend to the construction and design of private roadways, drainage systems, retention ponds and underground pipes, or any other common areas in a subdivision, because these structures do not immediately support the residences. The trial court agreed and entered summary judgment against the Association.
In entering summary judgment, the trial court relied upon Conklin v. Hurley, 428 So.2d 654 (Fla.1983), and Port Sewall Harbor & Tennis Club Owners Association, Inc. v. First Federal Savings and Loan Association of Martin County, 463 So.2d 530 (Fla. 4th DCA 1985). We review the trial court's order de novo. Volusia County v. Aberdeen at Ormond Beach, L.P., 760 So.2d 126 (Fla.2000). The Developer urges us to likewise rely on Conklin and Port Sewall, and to uphold the trial court's decision. We decline to do so, and, instead, hold that there is a common law warranty of habitability applicable in the case at bar. Although we are constrained by the holding in Conklin, it is our opinion that the facts of the instant case are distinguishable from the facts in Conklin. We, nevertheless, reach a different conclusion than our sister court in Port Sewall, which applied the holding in Conklin to a similar set of facts as presented here. We, therefore, certify conflict with the Fourth District Court of Appeal.
A review of the history of the application of implied warranties for habitability is instructive. For centuries, caveat emptor, "let the buyer beware," was generally the rule of law. This served well at a time when parties were thought to usually be on equal footing and neither had a significant advantage in discerning potential defects to goods sold in the marketplace. This theory was particularly persistent in land sales, where a buyer could, and wisely should, inspect the land to ensure it was suitable for the buyer's intended use. The notion of caveat emptor initially carried over into the construction and sale of homes and commercial buildings. Buyers could still inspect the land, and early building construction and land development was relatively simple.
As mass production of goods became more complicated and more common, courts began to impose liability on manufacturers and sellers, who were in a superior position to know of, or discover, defects than were the consumers. See, e.g., Manheim v. Ford Motor Co., 201 So.2d 440 (Fla.1967). Following this trend, courts
In Florida, the first case to extend the implied warranties of fitness and merchantability to purchasers of new homes was Gable v. Silver, 258 So.2d 11 (Fla. 4th DCA 1972) (hereinafter Gable I). There, the court quoted with approval the following language from Wells, Implied Warranties in the Sale of New Homes, 23 U. Fla. L.Rev. 626 (1971):
Gable I, 258 So.2d at 17.
The Fourth District noted that, at the time of its decision, the rule that implied warranties do not extend to realty was fast eroding, as fourteen other jurisdictions had already rejected the rule.
The Fourth District joined those jurisdictions applying implied warranties to the sale of new homes. It held that "the implied warranties of fitness and merchantability extend to the purchase of new homes and condominiums in Florida from builders." 258 So.2d at 18. The Florida Supreme Court upheld the Fourth District ruling, and established it as the law in this state. Gable v. Silver, 264 So.2d 418 (Fla. 1972).
A decade later, in Conklin, the case mainly relied upon by the Developer, the Florida Supreme Court discussed Gable I, and held that implied warranties of fitness and merchantability do not extend to first purchasers of residential real estate for improvements to land, other than the construction of a home and other improvements "immediately supporting the residence thereon, such as water wells and septic tanks." Conklin, 428 So.2d at 655. The facts of that case are important to an understanding of our reasoning in the instant case.
In Conklin, purchasers of vacant lots sought to recover from the developer for defects in a seawall abutting and buttressing the lots. The purchasers appeared to have bought the lots primarily for the purpose of investment, with an eye toward resale to other investors or to homebuilders. At the time of purchase, the seawall was the only improvement to the land. Following heavy rains, the seawall collapsed, and the purchasers sued the developer on a theory of implied warranty. Id. at 656.
Id. at 657-58. In considering the specific facts presented before it, however, the court found that such rationale was not applicable:
Id. at 658. It is clear then that the court's decision was based on the fact that the land and the seawall were subject to a competent inspection by the buyers, and that the buyers, as investors presumably on equal footing with the developer, were not in need of the consumer protection of implied warranties.
This view of the Conklin majority's decision is strengthened by a reading of Justice Adkins' dissenting opinion. He acknowledged the same historical trends in the application of implied warranties. He stated the same need for protection of consumers who do not have the requisite knowledge and expertise, and are dependent on the expertise of the builder/developer of a complex structure. Id. at 659-60 (Adkins, J., dissenting). He reached an opposite conclusion, however, decrying the failure of the majority to include "investors" in policy concerns for consumer protection, and finding that a seawall is also a complex structure; one that is "beyond the buyer's ability to inspect."
With this understanding of Conklin in mind, we distinguish it from the instant case. Here, the plaintiff seeking a remedy under the implied warranties is not an investor, as was the case in Conklin. Rather, it is a homeowners association, representing individual homebuyers who purchased the homes mainly for their own residential purposes. Thus, unlike the investors in Conklin, these homebuyers are clearly within the ambit of public policy extending consumer protection. Additionally, the defects in this case are distinguishable from the defect considered by the majority in Conklin. The structures here are, without dispute, complex site improvements, some of which are underground. These improvements were put in
Despite these factual distinctions, we acknowledge that we must also address the language in Conklin that extends the implied warranties only to improvements "immediately supporting the residence thereon, such as water wells and septic tanks." In applying that language to the facts presented in this case, we reach a different conclusion than our sister court in Port Sewall.
There, a homeowners association brought suit on behalf of the individual homeowners, based on breach of the implied warranties of fitness and merchantability, to recover for defects in the construction of certain roads and drainage areas in the community. Port Sewall, 463 So.2d at 530. The trial court entered a directed verdict in favor of the defendant, based on Conklin, and the Fourth District affirmed, stating:
Id. at 531.
We disagree with the Fourth District's conclusion that roads and drainage in a subdivision do not immediately support the residences. We find the phrase "immediately support the residence" is subject to two meanings. The most apparent meaning, which seems to be the one used by the Fourth District, is something that bears or holds up a structure, such as a footer, a foundation or a wall, or is attached to the house. But we do not read Conklin this narrowly, and instead find that the phrase also refers to essential services, such as the two specifically pointed out by the Conklin court itself, septic tanks and water wells. These obviously "support" the home by making it habitable, and so, fit for its intended purpose.
In the case before us, we consider other services that we conclude are essential to the habitability of the residence: roads, drainage systems, retention ponds and underground pipes. Regarding the latter, it does not matter if these are storm sewer pipes, water pipes or sanitary sewer pipes. They are all essential services. It is well to distinguish these services from non-essential services or items; some examples that come to mind, and not intended as an exhaustive list, but only illustrative, are landscaping, sprinkler systems, recreational facilities or a security system. A defect in these may be ugly, inconvenient or uncomfortable, but do not render a home unfit for its intended purpose, i.e., habitability.
Thus we announce a test that is elegant in its simplicity: in the absence of
We believe this ruling is in keeping with Florida's strong public policy of protecting consumers in a situation where they must rely on the expertise of the builder/developer for proper construction of these complex structures, where they are in an inferior position to inspect the work and to correct the defects in the construction phase and where the defects are not readily discernable to the average homeowner. We also believe this is an exercise in common sense. The builder/developer intends the improvements to be constructed free of defects, so the lots can be sold and homes constructed. The marketplace benefits because if the improvements are properly constructed, the homes are available not only for sale, but resale as well. Because the Fourth District reached a contrary conclusion in Port Sewall, we certify conflict with that opinion.
We are not complete in our review, however, if we do not address some collateral issues, raised on appeal. We reject the Developer's position that the Association cannot bring a claim for implied warranties for defects in the common elements, but rather that the individual homeowners must bring the claims and that such claims can only be for damage to their individual lots or homes. In reality, a homeowners association represents the individual homeowners, and any cost of repairs to the defects in the common elements will be passed on to the homeowners in the form of assessments, regardless of whether that individual homeowner has damage to his or her own property. To require each homeowner to maintain a separate suit for damages is contrary to public policy in that it contemplates a multiplicity of lawsuits for the same issues, something we do not countenance. Such a scenario is not in the best interest of plaintiffs or defendants, and seriously erodes judicial economy.
Additionally, we reject the Developer's argument that the Conklin court intended that the structures be physically attached to the house. The essence of the illustrations used by the court was services essential to supporting the residence in terms of habitability. Attachment was only incidental to providing the service. In a hyper-technical way, roadways, drainage systems and underground pipes abut or attach to residential lots and homes in a subdivision. But it would be illogical to provide a warranty to a home that is attached to an improvement, but not to another home that receives the service from the improvement, but does not physically touch it. The Developer urges a very strained and unreasonably limiting construction of Conklin.
We also reject the Developer's argument that extending the implied warranties is a matter for the legislature. In the absence of a legislative pronouncement, we are free to apply common law, and this is a case of application of common law warranties. In fact, Gable I applied common law warranties in a condominium case before
REVERSED and REMANDED. CONFLICT CERTIFIED.
GRIFFIN and ORFINGER, JJ., concur.