Legal Question in Construction Law in California

Re: Business closure

Close your business and hope for the best on warranty claims. If you have insurance, consider keeping it in force during the legally required warranty period. Your mistake was in not having a corporation. Too late to remedy that now.

Re: Business closure

As a sole proprietor, you are personally liable for all work done, including any warranty obligations. Unless you can locate another contractor to assume your warranty obligations (which is doubtful), I recommend that you maintain contacts with your subcontractors (to whom you can relay warranty claims) and keep you liability insurance in effect after your official business closure. For your liability insurance, check with you broker -- make sure it does not have a "prior work" exclusion.

These 2 measures won't make you immune from warranty and defect claims, but they will give you options to have others step and address the issues.

For further assistance on this matter, please feel free to contact our office to arrange for a consultation.

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Re: Business closure

If you do not have a written warranty as part of your contract, you are on the hook for two years on all oral agreements and four years on all written contracts after date of completion. However, this statute of limitations only applies to OBVIOUS defects (those defects which are visual on reasonable inspection;) on concealed defects, the statute of limitations is TEN YEARS. Keep your insurance in effect if feasible.

E. Leonard Fruchter