class action suit against builders – advice

[speaker]

We closed escrow back in early October 2013. Our house was built in 2006 so it is a fairly new build. we recently started receiving notices from a law firm that has filed a class action suit against the builder of our home.

Class action suits usually are nothing more than a cash grab by attorneys and so I tend to ignore them. Our home inspection report did not uncover any significant issues with the house. However, after a few months in the house I have uncovered a significant design flaw in the plumbing as well as other builder shortcuts.

The problems that I have been experiencing are significant enough that I am re-considering joining this class action suit. I am seeking advice on what I can expect from joining such a suit and what are the consequences or pitfalls should I join the class action suit. We have no plans on selling the house for at least 10 years. We bought this house knowing that we intend to stay for a very long time.

Thanks in advance.

[spdrun]

Interesting … Most class-action lawsuits are opt-out, meaning you’re automatically a member of the class unless you take action to remove yourself.

Two risks:
(1) Very rarely, you may be liable for legal costs if the suit is lost
(2) If you receive a settlement, it generally comes with a liability waiver — you can no longer sue the builder on your own for the problems with your house. What kind of costs are we talking about to fix the plumbing design error and other shortcuts?

[speaker]

Thank you for your response. I was incorrect about the letter. It is not an official class action suit that I have to “opt-in”. They are asking for my permission to allow them to do a visual inspection in anticipation of a class-action suit.

The plumbing will definitely be in the thousands because it will require breaking up concrete (foundation?) with removal and replacement of new pipes. I have already called a drain cleaning service 2x to clear blockages. I have not had the lines scoped by a plumber to determine the exact cause of the blockages, but I have spoke with the neighbors and they suffer from the same problems.

I can contact the law firm and ask for clarification. What questions should I ask from them?

[Hobie]

1 Opting in may put you on the hook for the upfront costs even if they decide to not start a class action.

2 Let them do the ‘inspection’ and give you a copy. ..Before opting in.

3 Code violations? Any current damages?

House seemed to work fine for 7 years, pass pre-purchase inspection and no realtor disclosed problems. Hmm. Like to know more about the actual problems driving this. Have you considered approaching the builder directly?

good read here:
http://www.northsandiegohomes.us/PageManager/Default.aspx/PageID=1917842&NF=1

“The statutes of limitations are shorter than ten years for the following building standards found in California Civil Code Section 896:

Plumbing and sewer systems must operate properly and not materially impair the use of the structure by their inhabitants: four years from close of escrow.”

[SK in CV]

Here’s how the vast majority of these kinds of suits flow. After filling out lots of forms and possibly a lengthy interview with a paralegal, you will be asked for access to your home for one, possibly more, visual inspections. You may then be asked for access to your home for invasive testing. The inspections and/or invasive testing will be conducted by numerous experts hired by the attorneys. You may or may not hear anything for up to a couple years. You may then be required to make your home available for similar inspections by the defense. Eventually you will be asked to sign a settlement agreement, where the attorneys will get 1/3, the expert’s fees will eat up another 1/3, and you’ll get a little check, and you’re on your own to take care of repairs. Rarely is then net settlement to the homeowners more than $10K.

With legislation in CA that went into effect over 5 years ago, many of your possible claims are beyond the statute. Some of the larger ones remain. They experts will find things wrong with your house. They always do. That’s what they get paid for. What they find may or may not have anything to do with specific complaints you have, as they’re rarely told what your complaints are.

Selling your home during the pendency of the litigation can be a problem. Lenders are sometimes hesitant to lend on properties that may have defects.

If you settle, your lawyers may or may not disclose to you what specific issues on your home were discovered and made part of the litigation. (Some lawyers do, some don’t.) If they don’t tell you, don’t ask. You’ll be required to disclose anything you know, upon sale of the property.

[speaker]

I haven’t had the plumbing issue properly diagnosed by a professional. I have had the plumbing cleaned 2x in 3 months by a drain cleaning service. I have also spoken with the neighbors that have the same floor plan as I do and they have all told me about the same plumbing problem. They have had their plumbing properly inspected and it was determined to be a design flaw. I haven’t met anyone yet in the neighborhood that has signed on to having their home inspected in anticipation of a class action suit.

The other problems appear to be cosmetic for now. The home inspection did not reveal any obvious or visible code violations or damages.

[Author]

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