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Excerpted from Verdicts & Settlements
Verdicts & Settlements (front page), December 12, 1997

"THE PANDORA’S BOX OF WATER INTRUSION LITIGATION"

By Michael Solender


Water intrusion in construction projects is one of the most vexing of problems to the property owner and its source of entry is sometimes one of the most difficult riddles to properly identify, locate and remediate. Water leaks, together with the numerous consequential problems caused by this condition, are generally one of the major reasons for the many law suits filed in construction defect cases. The causes of water intrusion are rain and sprinkler water which can enter the building envelope through inadequate flashing at the joints of doors and windows, roof penetrations, fireplace chases and chimneys, decks, dormers and window frames. Prolonged moisture buildup often occurs when leaks go unnoticed within the wall itself when it does not manifest itself at any interior surface.

Moisture assessments should always be performed with an accurate metering device, when the destructive testing is performed to locate the source of the leak. Moisture readings, especially in structural timber, between twenty and thirty percent should be monitored, while readings below twenty percent are normally acceptable. Moisture readings in excess of the fiber saturation point of wood, about thirty percent, require further investigating for decay. In nearly every case, the investigation into these issues discloses additional problems not formerly identified or known and very often the leak itself will still defy revealing its source. The investigative chasing down of the source of the water intrusion having revealed far more problems than it ever intended, is now the new benchmark for a whole series of consequential damage problems and claims, none of which were previously contemplated.

Water, in of itself, is the real enemy of construction elements and stucco plaster and the conditions it is designed to protect, are one of its chief victims. The water resisting material used behind most plaster/stucco systems in the south-western part of the USA is a building paper. Generally in areas that have a history of having less than twenty inches of rainfall a year, the building paper requirement is commonly called grade D and can withstand prolonged moisture for about eighteen minutes before becoming saturated, however its vapor permeability is about 32 hours.

With Exterior Insulation Finish Systems (EIFS) (sometimes called ‘one coat’ stucco) some interior elements of the EIFS such as exterior soffits, can hold water like a bowl for weeks at a time. To the extent that when a small probe is driven into the EIFS to test for moisture in the substrate, sometimes weeks after a rainfall, water will at times pour from the aperture for several minutes. The damage due to the wetting of the substrate, together with the almost certain resultant damage to some of the hidden elements such as structural lumber caused by this wetting process, are some of the important considerations that tend to drive many construction defects cases right through the fiscal roof. The high costs to repair is because construction costs are generally greater for repair than to build new when additional consideration is given to the partial demolition, protection of existing elements and relocation costs.

Both EIFS and stucco systems are designed to be vapor-permiable and for that reason the building paper used as their underlayment is grade D. This product permits the stucco system to breathe while the transit of the condensation within the wall cavity may be retarded by the use of a vapor barrier on the insulation face. Such moisture trapped within the walls, is not a cause for concern as it does not cause any rotting problems and will dry out of its own accord in the absence of post construction water leakage. Many experts incorrectly identify any kind of interior dampness with the term ‘construction defect’ when often the so-called defect is merely the stucco system performing as it is designed to perform. Of course the stucco system itself is designed to shed practically all the water that strikes its surface, but water may enter the stucco system through cracks in its surface, through voids around windows and doors and even eventually through the stucco system itself if it becomes saturated.

In construction defects litigation, the plaintiff’s experts have the task of preparing an appropriate plan of technical repairs and remediation of all the existing real or imagined construction problems (or defects) including structural damage due to moisture. These plans often include a repair matrix that frequently includes bringing the existing improvements up to the most recent (and most restrictive) building code. Of course the preparation of the plaintiff’s defects reports propounded by their many technical experts, together with the attendant comprehensive cost breakdown prepared to develop a complete cost to repair, provide gainful employment to many. Unfortunately this cost to repair often costs as much or more than the cost to build a new project.

In response, the defense needs to take a similar stand with their experts in order to provide an adequate defense to plaintiff’s contentions. Sometimes these contentions on some of the issues, are found to be fairly accurate and the contractor or developer then has to line up the various subs, who actually built the work in dispute, to come to the table with their insurance carriers in order to fund these necessary repairs. The solution to these many construction defects often becomes a puzzle wrapped in a quandary encased in a riddle. So now the flames are fanned for the ensuing confrontation that all started with one small leak of water into the building envelope.

Attorneys representing both sides of the issues have their work cut out for them as they attempt to sort out the many construction details including the hundreds of different legal issues. As complex as are the construction problems, the legal problems pose yet greater problems. From sorting through exactly who is most at fault on a variety of issues, then on to the actual time consuming business of negotiating with counsel for the many sub defendants and plaintiffs, then on to the myriad questions of insurance coverage’s. Often many substantial construction defects are not covered by insurance, simply because of the lack of consequential damage. The fact that a particular construction element has been improperly or poorly built, even to the point where the actual construction violates existing building codes or deviates from the construction blue-prints, maybe of no consequence to the insurance carrier if there is, as is most commonly found, within the contractor’s policy, particular work product exclusions or other types of exemptions.

All such cases are insurance driven, for without appropriate coverage there would be no one to pay the tab for the experts and the legal staffs, let alone for claims payments. In any event, the coverage policy doesn’t protect the insured from poor workmanship unless that condition has caused consequential damage to other elements and then generally only to that extent.

The mediation meeting place is where the large majority of cases are eventually settled, but the settlement doesn’t come cheap and it doesn’t happen quickly. Nevertheless the mediation process is the most effective device for settling construction disputes. The solution to the Pandora’s box of most construction defects cases, involves ultimately overcoming the innumerable conflicting questions of insurance coverage. Those legal mediators having the most comprehensive handle on these tricky insurance issues, are the ones who successfully manage to resolve the complexities of interlocking disputes, prior to court litigation.


MORE ARTICLES:

- THE CONSTRUCTION-EXPERT INDUSTRY: NEW DEVELOPMENTS

- CONSTRUCTION EXPERT CAN BUILD, OR DESTROY, A CASE

- EXPERTS CAN RESOLVE THE CONSTRUCTION CONUNDRUM
   Standard Construction Seldom Is Really Standard

- IN CONSTRUCTION CASES, BEWARE THE HIRED GUN

- THE COMPOUND CONSEQUENCE OF ONE SMALL
   DISCERNABLE LEAK INTO THE BUILDING ENVELOPE

- THE PANDORA'S BOX OF WATER INTRUSION LITIGATION

- CONSTRUCTION DEFECTS:
  How To Avoid the 'Big Hit' And Costly Litigation

- BUILDING A REMEDY

- WATER TORTURE

- THE WATCHER
   A third party may be helpful in monitoring the expert when figuring
   the cost of repairs

- KNOW-HOW
   A general contractor should have knowledge in related
construction areas to be effective as an expert witness

- EXPERT EASE
  OPINION: Construction defect experts provide lists of failures in
  preparation for litigation, and counsel must verify reports for accuracy

- MAKE READY
  Properly prepared expert witnesses will save both time and money.

- ON THE WATCH

- THE NUMBERS


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