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CONFIDENTIAL

Mar. 15, 1997

Construction
Construction Defects
Townhomes

Confidential

Settlement –  $3,079,620

Judge

Randall J. Wulff

Charles A. Bennett

Court

L.A. Superior Norwalk


Attorneys

Plaintiff

Karen L. Karavatos


Defendant

James L. Chase


Experts

Plaintiff

Dennis Wasson
(technical)

Donald Waller
(technical)

Michael D. Romanowski
(technical)

Defendant

Harold Woody
(technical)

James Knowles
(technical)

Dean Colin
(technical)

Facts

In 1991, the defendant developer completed construction of a 63-unit townhome development in La Mirada. The plaintiff homeowners association claimed defects, including soil subsidence, water intrusion through walls, windows and roofs, structural defects, omission of firestops and other building code violations which amounted to approximately $5 million in damages. The defendants admitted that some building code violations existed at the project, but claimed that repairs could be accomplished for less than $700,000. The plaintiff homeowners association brought this action against the developer, the design professionals and the subcontractor that originally planned, designed and built the townhome project based on breach of contract, breach of the covenant of good faith and fair dealing and negligence theories of recovery.

Settlement Discussions

The settlement award was reached approximately two years and six months after the case was filed. A mediation was held on Jan. 20, 1997 before Randall Wulff resulting in the reported settlement.

Damages

The plaintiff claimed $5 million in damages.


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