Facts

Eric Fisher, Bret Fisher, and Aubrey Degnan sold a home to Shannon Brown, who, in turn, four years later sold it to Brook Hardy and Alison Shellman. The Fishers and Degnan performed substantial rebuilding without obtaining permits or hiring licensed contractors or engineers. Brown told Hardy and Shellman that the Fishers and Degnan had applied for the necessary permits and modified the home according to code requirements because this was what the Fishers told Brown. Fisher/Degnan had supplied Brown with complete documents regarding the construction, and Brown had her contractor and home inspector review the construction of Fisher prior to paying Fisher for his work. Hardy and Shellman sued Brown, the Fishers, Degnan, and their realtors, among others, for fraud, negligence and breach of contract. They alleged the work performed without permits caused numerous problems in the home.

PLAINTIFFS' CONTENTIONS:
The plaintiffs contended Brown represented the house could pass inspection with minor repairs. Instead, the leach field failed and Brown concealed records of work performed on the house. The plaintiffs' basement floor flooded during the rains, the floor was poorly supported, mold grew in the master bedroom and a retaining wall was failing. The rafters were no longer connected to the ridge beam and could cause the house to collapse. A portion of the foundation was missing and the siding buckled due to exposure to the elements.

DEFENDANT'S CONTENTIONS:
Brown contended she had the leach field inspected and repaired. She relied on her realtor's advice in providing documents and properly disclosed the basement floor would dampen with the winter rains. The plaintiffs inspected the premises before purchasing the home and should have detected the alleged defects. Fisher/Degnan contended that Brown had taken a setoff in the initial purchase of the property for purposes of completing her own work on the septic system, and that Brown was fully aware that Fisher did not construct the retaining wall; Fisher further alleged that Brown had voluminous documents regarding the construction that she failed to disclose to the plaintiffs, and that it was never represented to Brown that Fisher had applied for permits.

Damages

The plaintiff's expert opined the numerous construction defects made the home less costly to rebuild than repair. The defendants contended repairs would cost $100,000. The real estate agents, the only insured parties, contended they were never aware of the home's defective condition or construction.

Result

The parties agreed to a mediated settlement of $211,000.