Verdicts / Settlements - Plaintiffs

Confidential

Facts

Between 1983 and 1987, developer defendants A and B were successively involved in developing several tracts of land in Calabasas. This work included rough grading in preparation for 240 condominiums. Most of the rough grading had been performed by June 1985, with some additional rough grading performed in the northern section of the site in March 1987. Thereafter, developer defendants C purchased the land and constructed 240 condominiums under entitlements previously obtained by developer defendants A. Developer defendants C began sales to the public in 1990. Plaintiff homeowner's association filed this construction defect lawsuit in February 1993.

Contentions

Plaintiff homeowners association contended the entire project sustained extensive damages in all 32 buildings of the project, as a result of construction and design defects as well as soil subsidence. Plaintiff also contended the buildings leaked in the rain, lacked structural integrity to withstand earthquake activity, and further contended that during the Northridge earthquake, while the case was pending, 4 buildings, including 29 units, sustained sufficient damages so as to be "red tagged" by the City of Calabasas. Plaintiff claimed one building sustained 4 inches of additional differential settlement triggered by the Northridge earthquake. Plaintiff alleged the buildings were constructed on improperly compacted fill, which was placed over compressible alluvium that should have been either carefully monitored or removed during the rough grading process. Developer defendants A contended structural problems were unrelated to soils and were caused solely by structural flaws in above-ground construction and lax building code requirements; and all of the problematic foundations and above-ground construction was performed long after developers A and B had sold and transferred interest in the property to the final builder. Developer defendants B contended they merely acted as construction managers, not developers, and thus were not subject to strict products liability theories. Developer defendants B further contended they were not negligent or otherwise at fault for the plaintiff's claimed damages. Developer defendants C contended that they were not responsible for any soils problems because they purchased the property after rough grading had been completed by developer defendants A and B; they were only responsible for certain defects, if any, to the structures themselves. All defendants disputed the scope and frequency of defects, deficiencies and resulting damages, and further contended the plaintiff's cost of repair was overstated.

Damages

Improperly installed roofs which did not comply with the project plans or the manufacturer's recommendations, leaking windows and sliding glass doors, missing or improper structural hold-downs and shear walls, missing or inadequate firewalls and firestopping material between party walls, differential subsidence of two buildings in northern canyon segment on project, enhancement of earthquake damage due to soils and structural deficiencies and a litany of lesser deficiencies identified in the plaintiff's expert's reports. Plaintiff's cost of repair estimate exceeded $15 million which was disputed by the defendants.

Settlement Discussions

Improperly installed roofs which did not comply with the project plans or the manufacturer's recommendations, leaking windows and sliding glass doors, missing or improper structural hold-downs and shear walls, missing or inadequate firewalls and firestopping material between party walls, differential subsidence of two buildings in the northern canyon segment of the project, enhancement of earthquake damage due to soils and structural deficiencies and a litany of lesser deficiencies identified in the plaintiff's expert's reports. Plaintiff's cost of repair estimate exceeded $15 million, which was disputed by the defendants.

Other Information