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CONFIDENTIAL

Aug. 9, 1997

Construction
Construction Defects
Condominium Complex

Confidential

Settlement –  $1,114,000

Court

L.A. Superior Santa Monica


Attorneys

Plaintiff

Alan I. Schimmel
(Schimmel & Parks APLC)

David A. Loewenthal


Defendant

Thomas F. Zimmerman

David L. Bell

Brian F. Zimmerman

Arnold L. Rosen

Steven F. Spierer


Experts

Plaintiff

James W. Griffin
(technical)

Gary Ludden
(technical)

Richard E. Donahoo
(Donahoo & Associates PC) (technical)

Gary C. Masterman
(technical)

Arthur Serata
(technical)

Facts

In 1992, the defendants completed construction of a 16-unit condominium/townhome project located in Santa Monica. In or about 1993, the plaintiff homeowner's association began to experience severe water intrusion, including, but not limited to, roofs, windows and decks. The plaintiff homeowner's association brought this action against the developer and various subcontractors based on strict liability, negligence and breach of warranties theories of recovery.

Settlement Discussions

The plaintiffs made an initial settlement demand for $1.6 million. No global settlement offer was ever presented by defendants but rather settlements were reached on a "piece meal" basis. There was a general inference during mediation from the defendants that the settlement value was approximately $500,000 to $600,000.

Other Information

The settlement was reached approximately one year and seven months after the case was filed. A mediation was held from mid 1996 to early 1997 before Ross R. Hart, of AAA resulting in the reported settlement. The extensive mediation became necessary when the prime insurer on behalf of the developer went into liquidation. Ultimately, final settlement was reached in March 1997, with the assistance of Ross R. Hart.


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