[highlights & comments added]

[We applaud this ruling and would like to see it repeated here in Texas.]

Nevada homeowners don't have to be the original purchasers of their domiciles to be protected under the state's construction defect laws.

Supporters are hailing a Nevada Supreme Court ruling in the state's largest construction defect case as reaffirming the rights of buyers of resale homes to sue for construction defects that went undetected by the original owners. The state high court denied the writ of builder Del Webb and subcontractor Anse requesting the removal of more than 700 Sun City Summerlin homeowners from the massive lawsuit.

In a unanimous decision, the court rejected Del Webb and Anse's arguments that the 729 subsequent homeowners should be removed from the lawsuit because their homes wouldn't fit into the legal definition of "new residences." The builder cited the Nevada Supreme Court's 2007 Westpark decision, which held that only the altered parts of condominium conversions would be considered new and thus protected under the state's construction defect law, Chapter 40.

The importance of suing under Chapter 40 rather than common law is that the state statute allows court costs, attorneys fees and negligence awards.

Justices agreed that the Del Webb assertion would go against the intent of the state's defect law to provide "an expansive remedy for homeowners and protection for developers." To rule in favor of removing the 729 homeowners from the lawsuit would result in "disparate treatment among otherwise similarly-situated homeowners."

Attorney Scott Canepa, who argued for the plaintiffs and against the Del Webb writ, praised the decision as good for everyone who owns a home in the state.

"It makes perfect sense because the question was whether the builder can get off the hook (for repairs) because the person is the second or third owner of the house," he said.

Canepa called the court's decision "consistent with state law." He also predicted the district court outcome of the lawsuit, known as the "stucco case," would be appealed. Canepa only worked on the response of the Del Webb writ to the Supreme Court and not the trial itself.

The six-month-long, on-again, off-again trial resulted in a $4 million jury verdict last month for a limited number of homeowners. That award was a far cry from the nearly $90 million plaintiffs attorneys had sought to fix nearly 1,200 homes with alleged defects. The case began more than five years ago.

Both sides will likely appeal at least parts of the case, said Michael Schulman, an attorney for the homeowners.

"We wouldn't be appealing the $4 million for our clients, we would be appealing for our clients that didn't receive anything," he said.

Schulman cited the case's decertification as a class action lawsuit by then-presiding District Court Judge Allen Earl as an obstacle. Class certification would have allowed the case to have 10 to 25 representative plaintiffs who would testify on behalf of the whole group, as opposed to having a number of homeowners tell their stories and be awarded individually.

"It certainly appears that them being able to testify made a difference (to the jury), but if everyone testified, and it took a half a day for each plaintiff, the trial would have taken two to five years."

The lawsuit was filed on behalf of 900 homeowners and seven subhomeowners associations against Del Webb, Pulte Homes and four subcontractors, including Anse.

"A lot of the appeal grounds will relate to jury instructions, also there were (evidence) issues. We thought there was some evidence that should have been allowed," Schulman said.

He also expects Del Webb to appeal the $4 million award, which while far less than the defense was seeking still breaks down as an unusually high amount per defective home.

"I don't think (Del Webb) will let $40,000 to $50,000 judgments on individual homes sit," he said.

Attorneys for Del Webb, and other defendants, were unavailable for comment at press time.

Valerie Miller, Las Vegas Business Press (vmiller@lvbusinesspress.com, 702-387-5286)
10/13/2008

Source: http://www.lvbusinesspress.com/articles/2008/10/13/news/iq_24385054.txt

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