Hayes Valley HOA to receive $2.33M for construction defects

By Tabitha Fleming | Jan 20, 2017

SAN FRANCISCO — A Hayes Valley homeowners association will receive a settlement of $2.33 million following a lawsuit it filed citing major construction defects.

The suit, which was filed in San Francisco Superior Court according to a news release, amounts to a payment amount of approximately $73,000 for each of the 33 units in the complex that was five years old when the complaint was initiated.

The suit named a number of failures in the construction of the property, among them were failures to correctly weatherproof the property that resulted in water intrusion into the garage, faulty lobby ventilation and improper installation of firestopping.

These types of failures to comply with building code aren’t all that uncommon, said Rachel Miller, senior partner of The Miller Law Firm, who represented the association.

“It’s common up and down the state,” she told The Northern California Record.

“Typically, when you buy into a condo building,” Miller said, “you only own the airspace within your unit and all of the other components are what’s called common area, and the association or the corporation that manages the building on your behalf has to look into and fix those defects. So if the building is under 10 years old in California, you can present the builder with the claims and have their insurance company pay for that damage and repair those issues rather than going back through yourselves as owners to pay for the repair of those issues.”

The process involves a lot of time both in and out of the courtroom with mediation, which can leave consumers in a difficult position concerning the outcomes of these cases. Of course, there are city and county building inspectors, but Miller said that consumers can’t rely on the government entities alone to insure that builders are following the law.

“First of all, cities have governmental immunity; you can’t go after the government anyway, and there is a shortage of inspectors and they aren’t looking at every single building component, they are checking for major systems,” she said. “It’s not something you can rely on as a consumer; you cannot rely on the city inspectors nor do they have any liability if they miss something.”

Miller wasn’t able to disclose the specific property or the builders or subcontractors who were a part of the settlement, a practice which she said is common. These confidentiality agreements between the association and the builders are part of what makes the waters difficult to navigate for consumers. There are, however, some things that consumers can do to protect themselves, and first among them is to be informed.

For now, Miller said the homeowners association will use the money it has recovered and hire a builder to make the necessary repairs. In this instance, she doesn’t expect repairs to take longer than a year to complete.

“They’ll hire a contractor and those repairs typically don’t take more than a year on a building of that size,” she said.

California law is supportive of consumers and ensuring they are treated fairly, Miller said.

“It’s the biggest investment anybody makes is to buy your home. California law is very supportive for consumer protection,” she said.

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