caveat emptor

Reserve-2-412cde36d1
Service_Request_Form_PagesWhat kind of idiots shell out, or commit themselves to borrow, two hundred thousand dollars for a row house and then sign on to a “warranty” that warrants nothing other than their responsibilities as buyers and owners?

Rubes from the hinterlands of Georgia, mostly, but also a bloke in New South Wales. Imagine!

I have written earlier about the mortgage notes that condition a loan on the buyers of property ceding their civil rights to the financier–e.g. on a standard Georgia form the borrower:

(2)Waives all rights which Borrower may have under the Fifth and Fourteenth Amendments to the Constitution of the United States, the various several states, the Constitution of the State of Georgia, or by reason of any other applicable law, to NOTICE AND TO JUDICIAL HEARING prior to the exercise by the lender of the right or remedy herein provided to Lender, except such notice as is specifically required to be provided in said Deed to Secure Debt;

Now this new form of indenture has taken a further step by effecting immunity for the builder of housing under the umbrella of a meaningless “warranty” that is obviously constructed to make it look like it’s a two-party agreement. In fact, one side listing things that aren’t covered by any guarantee and the other listing owner responsibilities add up to the same thing. And, if that’s not clear, the last page spells it out:

OUR CORPORATION WILL NOT CLOSE ON A HOME THAT HAS NOT HAD THE ORIENTATION LIST COMPLETED AND ACCEPTED BY THE HOME OWNER’S SIGNATURE.

The sellers are doing a favor when they let someone buy a house. Then there is this lovely follow-up instruction:

6 Month Request
The 6 month forms are to be completed and returned to the warranty department 6 months after the date of your closing. This report should only include non-emergency, warrantable items. Only items covered under the one year builders warranty that are stipulated on this form will be discussed at the Warranty Request appointment. No other items will be addressed at that time.

That the form has no provision for listing “builders warranty” items presumably falls into the category of “things left out.” Perhaps I should call them “sins of omission.”

By the way, the heading of this form, “SERVICE REQUEST,” is consistent with the notion that the buyer is “asking for it” even as it does not specify what “it” is. In practical terms, the buyer, whose signature is required, is not just agreeing, but asking to be defrauded–a new wrinkle to the notion of “informed consent.” That the Professional Warranty Service Corporation is not listed by the Georgia Insurance Commissioner as a licensed company should not come as a surprise. Scammers don’t need to be certified.

But, what I really like about this outfit is the final disclaimer relative to landscaping. It explains a lot about what is going on at the development known as The Reserve at Demere, a town-house development being constructed and sold on St. Simons Island by the Palmetto Building Group:

The sole responsibility for landscaping is to ensure proper sales and drainage away from the home.

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Editor's note: This story originally appeared at Hannah's Blog. Images: All of the images on this story are from PalmettoBuildingGroup.com (promotional, fair use).

Monica Smith

Monica Smith writes Hannah's Blog. Born in Germany, she came to the United States as a child, living first in California, then after an interval in Chile, in New York. Married to a retired professor at the University of Florida, where she lived for 17 years, she moved to St. Simons Island, Georgia, in 1993 and now divides her time between Georgia and New Hampshire. (New Hampshire, she says, is always interesting during a presidential election.) She and her husband have three children and five grandchildren. Ms. Smith says she "learned long ago that I am not a good team player when I got hired at the Library of Congress, fresh out of college with a degree in political science and proficiency in four foreign languages, to 'edit' library cards and informed my supervisor that if she was going to insist I punch the clock exactly on time, my productivity was going to fall from being the highest to being the same as everyone else's. The supervisor opted to assign me to another building where there was no time-clock. After I had the first of our three children, I decided a paycheck wasn't worth the hassle."