Do we have any legal recourse against our builder for not filing for a tax abatement?

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Do we have any legal recourse against our builder for not filing for a tax abatement?

We built a new house 2 years ago and just found out that our builder never filed the tax abatement for it when we got a bill for $3,000 in property taxes (for the first 6 months). They have since filed the application, but it will be two more years before the abatement kicks in. Do we have any legal recourse to go back against them to make them pay part or all of those taxes?

Asked on September 16, 2011 under Real Estate Law, Iowa

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The issue is whether the builder had an obligation to file for the tax abatement. That is, was that a part of the contract with the builder, that they would file the abatement? If it was and they failed, you can potentially sue, for breach of contract, for damages (your costs or losses). Or if the builder had represented to you prior to you signing the contract that they would file for the abatement, and they did this to get you to sign, and you reasonably relied on this representation in choosing to buy from them, then you may have a cause of action based in fraud for damages. On the other hand, if there was no representation made prior to executing or entering into the contract and also nothing in any contract or agreement requiring this, then you probably do not have a cause of action against the builder.

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

You need to carefully read your written contract with your contractor/builder regarding the home that he or she constructed for you in that its terms and conditions control the obligations owed to you and vice versa in the absence of conflicting state law.

If the written contract does not state any obligation of your former contractor/builder to file an application for a tax abatement concerning the new house that was constructed, he or she had no legal obliagtion to do so. If so, then you have no legal recourse against the contractor/builder for not filing the tax abatement application.

Generally, the application needs to be signed by the owner of the property from other forms that I have seen in the past.


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