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CONFIDENTIAL

Nov. 7, 1998

Construction
Negligent Construction
Condominium Complex

Confidential

Settlement –  $585,000

Mediator

Ross Hart

Court

L.A. Superior Torrance


Attorneys

Plaintiff

Michael K. Wolder
(Wolder & Associates)


Defendant

Geoffrey L. Taylor

Robert N. Ridenour

Jack R. Reinholtz
(Prindle, Goetz, Barnes & Reinholtz LLP)

David L. Bell

Cynthia Coulter Mulvilhill

Daren T. Johnson


Experts

Plaintiff

Bill Sterling
(technical)

Russell Thompson
(technical)

Facts

The subject of this dispute was a contemporary six-unit condominium located directly across from the beach in the city of Redondo Beach. The plaintiffs contracted with defendant construction company to build the complex according to plans and specifications prepared by the plaintiffs' architect. All of the units, and the project as a whole, are generally considered very "high-end." Beginning in late 1991, the plaintiffs experienced severe leaks and water intrusion into the units through doors, ceilings, light fixtures and walls. All of the units contained expensive hardwood flooring and expensive furnishings liked grand pianos and expensive rugs, some or all of which were damaged due to water infiltration. In addition to the water infiltration into the interior of the units, the subterranean parking garage was also flooding at each rain, often backing up into the individual garages and storage areas and the elevator room, causing futher damage. From 1991 through 1995, the plaintiffs notified defendant and the defendant would respond, sometimes alone, sometimes with subcontractors, to inspect and attempt to remedy the leaks with caulking and putty. The plaintiffs sued the defendant construction company for breach of contract, negligence and diminution in value. Counsel for the parties agreed to hire an expert jointly, to perform watershed testing and prepare a report, including cost of repair. Plaintiffs retained a construction expert who prepared a cost to repair the interior of the units damaged by the water infiltration.

Settlement Discussions

The plaintiff made a C.C.P. º998 settlement demand for $_____. The defendant made a C.C.P. º998 offer of compromise for ________.

Other Information

The settlement was reached approximately three years and three months after the case was filed. Plaintiffs entered into a "Mary Carter" agreement with the defendant contruction company in exchange for an assignment of the contractors cross-complaints against the framer and window distributor. The framer and window distributor subsequently settled with the plaintiffs.


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