Owner Who Accepts and Takes Possession of Incomplete or Obviously Defective Building Waives Patent and Obvious Defects, but Does Not Waive Latent Defects

Steltz v. Armory, 15 Idaho 551, 99 P. 98 (1908)

Steltz contracted with Armory for the construction of a building in the city of Genesee.  The building was erected and Armory moved in and continued to use it for six weeks, until a windstorm blew down the front of the building.  Armory then refused to pay Steltz arguing that the building was not constructed in a workmanlike manner and Steltz filed this action to recover payment due under the contract.  During trial, evidence was presented that showed the front wall blew down because it had not been properly tied into the rest of the building.  The court held that the defect of not tying the front wall into the building was not an obvious or patent defect, but was a latent defect.  The Court reasoned that if the defect were obvious or patent, then Armory would have accepted the defect by taking possession without conditionally doing so.  The court affirmed the lower court’s decision to offset the cost to repair the defect from the amount still owed under the contract.