§ 777-B — Exclusion or modification of warranties

§ 777-b. Exclusion or modification of warranties. 1. Except in the\ncase of a housing merchant implied warranty, the builder or seller of a\nnew home may exclude or modify all warranties by any clear and\nconspicuous terms contained in the written contract or agreement of sale\nwhich call the buyer's attention to the exclusion or modification of\nwarranties and make the exclusion or modification plain.\n 2. Except in the case of a housing merchant implied warranty, the\nbuilder or seller of a new home may exclude or modify warranties with\nrespect to particular defects by any clear and conspicuous terms\ncontained in the written contract or agreement of sale which identify\nsuch defects, call the buyer's attention to the exclusion or\nmodification of warranties and make the exclusion or modification plain.\n 3. A housing merchant implied warranty may be excluded or modified by\nthe builder or seller of a new home only if the buyer is offered a\nlimited warranty in accordance with the provisions of this subdivision.\n a. A copy of the express terms of the limited warranty shall be\nprovided in writing to the buyer for examination prior to the time of\nthe buyer's execution of the contract or agreement to purchase the home.\n b. A copy of the express terms of the limited warranty shall be\nincluded in, or annexed to and incorporated in, the contract or\nagreement.\n c. The language of the contract or agreement for sale of the home must\nconspicuously mention the housing merchant implied warranty and provide\nthat the limited warranty excludes or modifies the implied warranty.\nLanguage to exclude all implied warranties is sufficient if it states,\nfor example, that "There are no warranties which extend beyond the face\nhereof."\n d. The limited warranty shall meet or exceed the standards provided in\nsubdivisions four and five of this section.\n 4. A limited warranty sufficient to exclude or modify a housing\nmerchant implied warranty must be written in plain English and must\nclearly disclose:\n a. that the warranty is a limited warranty which limits implied\nwarranties on the sale of the home; the words "limited warranty" must be\nclearly and conspicuously captioned at the beginning of the warranty\ndocument;\n b. the identification of the names and addresses of all warrantors;\n c. the identification of the party or parties to whom the warranty is\nextended and whether it is extended to subsequent owners; the limited\nwarranty must be extended to the first owner of the home and survive the\npassing of title but may exclude any or all subsequent owners;\n d. a statement of the products or parts covered by the limited\nwarranty;\n e. the clear and conspicuous identification of any parts or portions\nof the home or premises that are excepted or excluded from warranty\ncoverage, and the standards that will be used to determine whether a\ndefect has occurred; provided, however, that:\n i. any exception, exclusion or standard which does not meet or exceed\na relevant specific standard of the applicable building code, or in the\nabsence of such relevant specific standard a locally accepted building\npractice, shall be void as contrary to public policy and shall be deemed\nto establish the applicable building code standard or locally accepted\nbuilding practice as the warranty standard; and\n ii. any exception, exclusion or standard that fails to ensure that the\nhome is habitable, by permitting conditions to exist which render the\nhome unsafe, shall be void as contrary to public policy.\n f. what the builder and any other warrantor will do when a defect\ncovered by the warranty does arise, and the time within which the\nbuilder and any other warrantor will act;\n g. the term of the warranty coverage and when the term begins,\nprovided, however, that such term shall be equal to or exceed the\nwarranty periods of a housing merchant implied warranty, as defined in\nsubdivision one of section seven hundred seventy-seven-a of this\narticle;\n h. step-by-step claims procedures required to be undertaken by the\nowner, if any, including directions for notification of the builder and\nany other warrantor; an owner shall not be required to submit to binding\narbitration or to pay any fee or charge for participation in nonbinding\narbitration or any mediation process;\n i. any limitations on or exclusions of consequential or incidental\ndamages, and any limitations on the builder's and other warrantor's\ntotal liability, conspicuously expressed on the first page of the\nwarranty. Notwithstanding the foregoing, a limited warranty shall not be\nconstrued to permit any limitation on or exclusion of property damage to\nthe home proximately caused by a breach of the limited warranty, where\nthe court finds that such limitation or exclusion would cause the\nlimited warranty to fail of its essential purpose, except that such\nproperty damage may be limited by an express limitation on the builder's\nor other warrantor's total liability in accordance with the provisions\nof this paragraph.\n 5. a. This article shall not be construed to authorize or validate any\ncovenant, promise, agreement or understanding which is void and\nunenforceable under section 5-322.1 of the general obligations law.\n b. This article shall preempt any local law inconsistent with the\nprovisions of this article. This article shall not preempt any builder\nsubject to its provisions from complying with any local law with respect\nto the regulation of home builders except as expressly provided herein.\n c. Nothing in this article shall be construed to repeal, invalidate,\nsupersede or restrict any right, liability or remedy provided by any\nother statute of the state, except where such construction would, as a\nmatter of law, be unreasonable.\n