Home defect suits settled for $21 million

Tuesday, Feb. 29, 2000 | 10:50 a.m.

Five Las Vegas home builders and developers agreed this month to pay $20.95 million to settle two construction defect lawsuits.

A $16.2 million construction defect lawsuit filed in 1997 against Rhodes Design and Development Corp. and two now-defunct builders, H.B.R. Development Inc. and and Halco Inc., was settled on Feb. 14 in favor of 188 single-family homeowners at the Casa Linda subdivision in North Las Vegas.

Scott Canepa, the plaintiffs' attorney -- who said he believes this is the largest residential construction defect settlement in the history of home building here -- alleged the 188 homes were structurally defective due to inadequate geological engineering, expansive and corrosive soils beneath the residences.

Corrosive soils have a higher-than-normal concentration of sulphates and may eat into concrete and damage sidewalks and driveways. Expansive soils can expand when in contact with water, and with sufficient force, they can lift the house, causing cracks in the drywall and interior doors and windows to be stuck, Canepa said.

"The houses were breaking apart because the builders didn't take into account the expansive soils identified by soil engineers when they designed and constructed the homes," Canepa said. "Some of the houses were lifted as much as 5 inches by the expansive soils, causing the drywall to crack and break apart."

Canepa will be paid a $6.47 million attorney's fee and $1.14 million in reimbursements for expenses advanced to the homeowners, said District Court Judge Gene Porter in a Feb. 14 order.

"This is no time for celebration for these owners," Canepa said. "This has been a long hard fought battle against the builders and their insurance companies, who have bent every effort to try and avoid liability and damages in this case."

As part of the settlement, the 188 homeowners each are to be paid an average of about $50,000. The average cost of repairing the homes is estimated at about $45,000.

Separately, a $4.75 million construction defect settlement was approved on Feb. 3 in favor of Rock Springs Vista 8 Owners Association against the project's developer Rock Springs Vista Development Co. and general contractor J.A. Black Construction Co. Inc.

Canepa, who also represents Rock Springs homeowners, said the 133-unit condominium project suffered numerous defects caused by the defendants' alleged faulty workmanship. The project is near Buffalo and Vegas Valley drives in Las Vegas.

"There were deficiencies in framing and stucco, roofs and major problems with civil engineering such that many of the units were flooded by rains," Canepa said.

"This settlement will allow the association to commence repairs on significant construction defect problems including drainage, stucco, roofing, electrical and plumbing which will bring the project in compliance with local codes and restore value to the 133 condominium homes in the community," he said.