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Tuesday, November 10
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Owner builds

Goeglein Homes wins appeal as Indiana owners who withheld $111,235 on a modular home must pay $221,704

Indiana's Court of Appeals upheld on Nov. 9 a $221,704 judgment for builder Goeglein Homes, LLC in a lawsuit with a couple who paid $100,000 toward a $211,235 modular home and then withheld the final payment over what they called construction defects.

The appeals court sided with the trial court on two points, according to a Times of India report on the decision. Goeglein Homes had substantially performed its side of the contract, and the owners had kept the builder from finishing the remaining work. The couple had paid less than half the price and held back the other $111,235, citing problems with the build.

The judgment is roughly double the unpaid balance. The report does not say what makes up the difference, such as interest, fees or costs. It also does not list the defects the owners claimed or say where the house stands.

Indiana law sets out how a homeowner should press a defect claim. Under the state's notice and opportunity to repair statute, Indiana Code 32-27-3, the owner must serve the builder written notice at least 60 days before suing, and the builder has 21 days to answer with an offer to inspect, repair or pay, or with a refusal. An owner who accepts a repair offer has to give the builder reasonable access during normal working hours. If an owner unreasonably rejects a reasonable offer or does not allow a fair chance to inspect or repair, the court may shift attorney's fees and costs to the builder.

The court's full opinion was not available when this story was published, so its reasoning on the specific defects and on how the builder was kept off the job is not yet known.

Why it matters: Holding back the last payment is the usual owner move in a defect fight. Here the court found the builder had substantially performed and the owners blocked the finish, and the bill came to about twice the balance. Builders should log punch-list offers and refused site access in writing.

Sources

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