Defendant and appellant, A.A. Quality Construction (A.A.
Quality), appeals a jury verdict in favor of the plaintiffs,
George and Helen Samuelson. Trial was held in the Seventh
Judicial District, Dawson County. The jury found A.A. Quali-
ty liable to the Samuelsons in the amount of $11,158.90 for
damages sustained relating to the construction of the
Samuelsons' home by A.A. Quality. We reverse and remand.
We address the following three issues on appeal:
1. Is the implied warranty of habitability applicable
under the facts of this case?
2. Did the District Court err by refusing to admit the
construction contract into evidence?
3. Did the District Court err by refusing defendant's
proposed Instruction No. 19 which pertained to assumption of
risk?
In March 1981, A.A. Quality agreed to sell two lots and
construct a home in Glendive, Pllontana, for the Samuelsons.
The total contract price was $155,804. Prior to entering the
contract, George Samuelson asked Albert Aldinger, president
of A.A. Quality, whether the foundation of the home should be
equipped with any special drainage devices to help ensure
proper drainage of water away from the foundation. According
to George Samuelson's testimony, Mr. Aldinger advised them
that precautionary drain devices were not necessary. In
contrast, A.A. Quality asserts that Mr. Aldinger merely
explained that he had built 7 or 8 other homes in the same
general area and those homes had not required any special
drainage devices. Mr. Aldinger also testified that the
decision not to include such devices was left to the
Samuelsons. A.A. Quality did not install drainage devices in
the home.
During construction, the Samuelsons noted that the
basement area accumulated water several times. Mr. Aldinger
initially explained that the water entered the structure
through window cutouts that were not yet covered with glass.
Later the parties realized that the basement had a water
seepage problem. A.A. Quality attempted to correct the
problem by installing an exterior cement slab to divert water
and by repairing rock pockets in the foundation.
The Samuelsons began to occupy the house in December
1981 and did not experience water seepage during the winter
months. In the spring of 1982, water seepage began to reoc-
cur and continued intermittently during wet periods.
The affected basement areas included a guest bedroom,
storage area, recreation room and a crawl space. The record
indicates that the seepage caused problems in many respects:
furniture was removed from the guest bedroom, portions of
sheetrock were removed from two walls in an attempt to locate
the problem, the carpeting was rolled back for weeks at a
time to allow it to dry and was entirely removed on one
occasion, floor heaters were used to dry the wet areas, a
pump was used to clear the crawl space of excess water, use
of the recreation room was restricted, items in the storage
room had to be raised above the floor, and a vacuuming ser-
vice was required on several occasions to vacuum water from
the basement.
As the water continued to reoccur and the efforts of
A.A. Quality to halt the problem proved unsuccessful, the
working relation between A.A. Quality and the Samuelsons
became increasingly strained. Eventually, A.A. Quality
refused to make further attempts to remedy the problem. In
the fall of 1983, the Samuelsons hired another contractor.
The contractor excavated the cement slab and backfill from
around the house and installed a drain pipe along the
foundation to carry water away from the house. These efforts
apparently stopped the water seepage.
The Samuelsons brought an action against A.A. Quality
and Albert Aldinger. Aldinger was dismissed as a party
defendant prior to trial. The Samuelsons proceeded to trial
against A.A. Quality on theories of negligence and breach of
the warranties of habitability and workmanlike construction.
The jury found in favor of the Samuelsons, and A.A. Quality
appeals.