An Outline of the Davencourt Opinion

As promised, I’m trying to figure out, and to help others to figure out, what the new Davencourt v. Davencourt opionion means; I plan on spending a few hours reviewing the case while I’m on a plane tomorrow, continuing that quest. In anticipation of that, and to help make this more manageable, I’ve typed out the case outline, as set forth in the opinion. In the next several posts, I’ll comment on each of these sections, and I’ll update each of them with a link, when I do. Hopefully, that will be helpful.

The Davencourt Opinion — An Outline

I. THE DISTRICT COURT ERRED, IN PART, IN APPLYING THE ECONOMIC LOSS RULE

A. The Economic Loss Rule Remains in Force

B. The Economic Loss Rule Applies Despite Whatever Unique Relationship Exists Among the Association, Developer, Builder and Unit Owners

C. Construction Components Integrated into a Finished Product Do Not Constitute “Other Property”

D. The Existence and Scope of Independent Duties

1. Neither the Builder, the Developer, Nor Woolstenhume, in Their Respective Expertise and Relationships, Owe the Nonpurchasing Association an Independent Duty

2. The Limited Fiduciary Duty Owed by a Developer in Control of a Homeowner’s Association Falls Outside the Scope of the Economic Loss Rule

3. Utah Does Not Recognize an Independent Duty to Conform to the Building Code

4. Utah Does Not Recognize an Independent Duty to Act Without Negligence in the Construction of a Home

II. UTAH RECOGNIZES A CAUSE OF ACTION FOR BREACH OF THE IMPLIED WARRANTY OF WORKMANLIKE MANNER AND HABITABILITY

III. THE DISTRICT COURT MISAPPLIED THE COLLATERAL RIGHTS EXCEPTION OF THE MERGER DOCTRINE TO DISMISS THE CONTRACT AND EXPRESS WARRANTY CLAIMS

A. Contract and Warranty Claims Regarding the Quality of Construction Are Collateral to the Conveyance of Title

B. The Absence of an Act After the Delivery of the Deed Is Not Conclusive Evidence of the Parties’ Intent

IV. THE DISTRICT COURT ABUSED ITS DISCRETION IN DENYING THE ASSOCIATION’S MOTION TO AMEND THE COMPLAINT AND REINSTATE DISMISSED CLAIMS

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