Facts

Plaintiffs Amanda and Jordan Thomasson purchased their home in 1999. It was a large, premium lot with a commanding view of Chino Hills that sat atop a 160-ft descending slope. After purchasing their home, they hired Alpine Custom Pools and Spas to both design and construct their rear yard improvements. Alpine installed a swimming pool with rock waterfall features, a gazebo structure at the top of the slope, and other hardscaping such as a built-in barbecue, fire ring, and extensive concrete flatwork. Alpine also landscaped the yard for the Thomassons.

In 2003, the Thomassons noticed certain minor cracking in their waterfall features that was repaired by Alpine. Those cracks reappeared approximately 18 months later, and they were once again repaired by Alpine. When the cracks reappeared again one year later and other cracks started to appear in the hardscape and swimming pool, the Thomassons contacted Standard Pacific and Alpine to investigate. Both Alpine and Standard Pacific told the Thomassons that it was "anticipated slope drift" that did not warrant repair.

In 2008 the Thomassons retained counsel and geotechnical engineers to investigate their claims. A slope inclinometer and several crack gauges were installed, and the engineers also placed three piezometers to measure water levels on the lot.

PLAINTIFFS' CONTENTIONS:
The Thomassons contended that as time went on, the cracking throughout their rear yard improvements worsened, the pool became 1 inch out-of-level, and there were cracks and separations up to three inches that had appeared and were widening. Over the next year, after the inclinometer was installed, it showed continued movement of the slope, and it was the Thomassons' contention that all of the rear yard improvements continued to suffer extensive damage as a result thereof. In addition, the Thomassons contended that their marble flooring throughout the downstairs of their home and the hardwood in the kitchen was debonding as a result of excessive moisture vapor permeating through the slab. It was contended by the Thomassons that their house suffered from a perched water condition that exposed the footings and slab to excessively-saturated water conditions and that Standard Pacific had failed to install sand layers above and below the plan-required visqueen layer underneath the slab, which was also allegedly torn in some locations as shown by Plaintiffs' slab coring. All of this, it was contended, led to the debondment of the flooring.

Charles and Arlene Woo complained that the house they purchased suffered from two leaking showers, window leaks, stucco and drywall cracks attributable to structural movement, mold from the leaks, and a leaking French door system.

DEFENDANT'S CONTENTIONS:
In relation to the Thomassons, Standard Pacific did not dispute the nature of the rear damage. Rather, it contended that the Thomassons had been provided with a number of disclosures very clearly pointing out that they had purchased a home with expansive soils that sat atop a large manufactured slope. As a result, the Thomassons needed to take great care in designing and constructing their rear yard improvements to account for predictable lateral fill extension, which Standard Pacific contended they ignored. Furthermore, Standard Pacific contended that Alpine failed to properly engineer the rear yard improvements for the expansive environment in which they were to be constructed, and as a result, the damage that the Thomassons experienced was almost a certainty. Furthermore, Standard Pacific contended that had the Thomassons and Alpine designed their rear yard improvements to anticipate the slope movement that they experienced, the damages would have been almost indiscernible. Finally, Standard Pacific contended that Alpine and its geotechnical engineer who participated in the rear yard design intentionally misrepresented to the City of Chino Hills the size of the slope adjacent to the Thomasson property. By doing so, Standard Pacific contended that the design was not subjected to an appropriate critical review by the City, and had the true size of the slope been disclosed, Alpine would have been required to redesign the rear yard improvements.

With respect to the moisture-through-slab claim, Standard Pacific argued that it sold the house to the Thomassons with a bare slab. Therefore even if there were significant amounts of moisture vapor coming through the slab, the Thomassons' flooring contractor should have tested the slab before installing the flooring. Had the flooring contractor done so (which Standard Pacific contended was the standard of care in 2000), the contractor would have sealed the slab and there would be no potential debonding at the present time. Standard Pacific was also critical of the Thomassons' claim to a perched water condition. According to the company, the Thomassons' engineer's construction of the piezometers was improper because their bentonite caps were too thin, thereby allowing the easy infiltration of rain and irrigation water. As a result, any readings of elevated groundwater did not accurately depict the true subsurface condition.

With regard to the Woo house, Standard Pacific contended that any leak in the showers was a result of the Woos' failure to maintain them, and with respect to alleged window and French door leaks, Standard Pacific disagreed that there was adequate evidence of any such leaks and criticized the Woos' failure to follow ASTM standards for proper leak detection.

Settlement Discussions

The Thomassons demanded $1.5 million one month before arbitration. Standard Pacific issued a C.C.P. section 998 offer for $30,000 on Sept. 22, 2009, and later increased the offer to $100,000 in response to their demand. The Woos demanded slightly over $100,000, approximately one month before arbitration. Standard Pacific issued a C.C.P. section 998 on Nov. 2, 2009 in the amount of $2,000 and refused to any higher.

Damages

The Thomassons claimed $1,173,531 in cost of repair and Stearman costs. This included a 55-foot deep caisson and grade beam repair at the top of slope, a complete rebuild of the rear yard improvements, installation of a perimeter French drain around the house to address the perched water condition, and removal and replacement of the flooring and interior cabinets to allow slab sealing. Also because the contract between the Thomassons and Standard Pacific contained an attorney's fee provision, the Thomassons demanded an additional 40 percent of that amount. The Woos claimed cost of repair plus Stearman totaled $72,542 (plus fees and costs). That included repairing all of the conditions listed above and implementing a Phase 1 mold abatement protocol.

Result

The arbitrator found in favor of Standard Pacific on both cases. Standard Pacific was also found to be entitled to recover attorney fees and costs. Standard Pacific's motion, seeking to quantify that award in the amount of $149,844, is pending before the court.