Facts

Plaintiff 3944 HOA brought an injunctive action to compel access to defendant George Crawford and B. Miller's townhouse. Miller and Crawford subsequently cross-complained against the HOA, the mold remediation company, the construction company, the seller, and the seller's agent, for a number of causes of action. Relevant to cross-defendant Shvartzman are the causes of action for fraud (failure to disclose), negligent misrepresentation, and violation of C.C. Sec. 1102 and 1368 et seq.

Cross-complainants purchased a townhouse from Shvartzman in a complex that apparently had experienced earthquake damage, and was also subject to a developer's construction defect action. Cross-defendant Shvartzman was not a party to either of those actions.

The HOA agreed to perform some repairs using licensed contractors and repair persons. Those professionals made repairs.

Cross-complainants refused reentry. A dispute with HOA ensued which resulted in an equitable action by the HOA to allow access to the townhouse and to make repairs.

Cross-complainants filed a cross-action naming the HOA, repair persons and companies, and the persons who sold them the unit. The action against the HOA included fraud and breach of fiduciary duties relative to the taking of insurance and settlement monies. The action against Shvartzman also contended fraud and failure to disclose the construction defect litigation and conditions in and about the property.

CROSS-COMPLAINANT'S CONTENTIONS:
Cross-complainants claimed to have experienced mold and other damage, which they claimed the HOA was responsible for. The cross-complainants claimed that the repairs were done negligently, and that the conditions were not fixed.

CROSS DEFENDANT'S CONTENTIONS:
The cross-complainants did not comply with the mediation provision of the real estate sales agreement with Shvartzman prior to the commencement of the action. Shvartzman did not prevent any inspections. Shvartzman contended that she did not commit any fraud or prevent any inspection prior to the sale. She further contended that all matters claimed not to have been disclosed were actually known or knowable to cross-complainants.

Settlement Discussions

A JAMS mediation resolved the conflict between Mr. Crawford, Mr. Miller and the HOA. Shvartzman did not participate. Cross-defendant Shvartzman's settlement demand of $1,000, then $5,000, then $10,000 to be dismissed and for a full release were all rejected by the cross-complainants. They further failed to mediate and/or arbitrate as required under the real estate sales agreement or in the Court-ordered mediation.

Damages

Cross-complainants claimed that they suffered toxic mold poisoning symptoms, stuffy head, cold-like symptoms, and rashes, as well as diminished value of real property and repairs therefor.

Result

Cross-complainants Bryan Miller and George Crawford were required to pay sanctions of approximately $10,000, and $5,000 to cross-defendant Shvartzman to obtain her release from claims of malicious prosecution.

Other Information

According to cross-defendant, it was discovered post-settlement that George Crawford intentionally failed to disclose a pending litigation against Hewlett-Packard claiming personal injuries similar to this action's; he also failed to disclose that he was the victim of a battery also relevant to this action.