When an Oregon “As-is” Condo is not “As-is”

Recently, I have been contacted by several Oregon condominium association board members and individual homeowners whose conversion condominiums are experiencing serious construction defects and substantial repair costs.  Some of these owners and board members have stated they don’t believe they have any legal claims because the developer sold the condominium unit “as-is.”

Oregon law, as in many states, provides statutory warranties or disclosure requirements for initial condominium purchasers–for both new condos and conversion condos:

*  A Declarant of a newly constructed condominium shall expressly warrant against defects in the plumbing, electrical, mechanical, structural, and all other components of the newly constructed units and common elements.  The applicable statute is ORS 100.185.

*  A Declarant of a conversion condominium must provide a statement of the “present condition of all structural components and major mechanical and utility installations in the condominium, including the approximate date of construction and a reasonable estimate of the remaining useful life of, at a minimum, the roof, siding, plumbing, electrical, HVAC system, asphalt, sidewalks and decks.”  The disclosure also must include a statement of whether the assessment of conditions was prepared by a licensed engineer, architect or home inspector.  The applicable statute is ORS 100.655(h).

Thus, there is no such thing as an “as-is” new condominium unit sold in Oregon.  Although Declarants may sell a conversion condominium unit without a warranty, or “as-is,” that does not necessarily mean an owner or association foregoes all legal rights in the event construction defects or prior damages exist.  An owner or association may have claims for lack of proper disclosure in the Condominium Disclosure Statement, regardless of whether an “as-is” statement was included in the Condominium Disclosure Statement and/or Purchase and Sale Agreement.

Lastly, although there are no reported Oregon appellate decisions directly on point, courts in other states (including neighboring Washington) have rejected a Declarant’s attempts to disclaim warranty and disclosure obligations through a general “as-is” statement.

If you have specific questions regarding your condominium’s warranties or disclosures, feel free to contact the Portland or Bend offices of Barker Martin, P.S.

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