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CONFIDENTIAL

Apr. 6, 1996

Construction
Construction Negligence
Apartment Complex

Confidential

Settlement –  $250,000

Judge

Richard C. Hubbell

Court

L.A. Superior Central


Attorneys

Plaintiff

Adam S. Warshaw

Gary W. Verboon


Defendant

Risa Dauer

William G. Kelsberg


Experts

Plaintiff

Chris Ball
(technical)

Clayton McKeown
(technical)

Defendant

Ben Aviv Damari
(technical)

Facts

In 1988, the defendants were the developers, general contractors and seller(s) of a 10-unit apartment building in Hawthorne. The plaintiff purchased the building after its construction and had no involvement in the construction. The plaintiff sued the named defendants for various construction defects in the building, including defective roofing, defective decks, deficient framing, and plumbing defects. The named defendants in turn cross-complained against several of the design professionals and/or subcontractors who worked on the building during its erection. The developers' insurance coverage was problematic, with coverage gaps and lapses. The plaintiff brought this action against the defendants based on strict liability, breach of contract, negligence, breach of the covenant of good faith and fair dealing theories of recovery.

Settlement Discussions

The plaintiff made a $250,000 settlement demand from the developer entities in addition to an assignment of all contractual indemnity rights against the subcontractors. The plaintiff and the named defendants settled for $250,000 in cash and assignment to their indemnity rights against certain of the subcontractors.

Damages

The plaintiff estimated that the cost to repair the alleged defects, including rent and relocation was $375,000 as to the developer only.

Other Information

The settlement was reached approximately one year and three months after the case was filed. The indemnity claim and roofing and decking issues, are pending against the subcontractors.


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