Orange County's informational source since 1905 * Tuesday, June 25, 2002

By Jennifer Hieger

Shea homeowners win $7.8 million verdict over defects, mold

COURTS - parties settle for a different amount, but some wonder if mold is the next asbestos.

        A jury this month leveled a $7.8 million verdict against Shea Homes for construction at a project in Laguna Niguel, according to the lawyer who represented the homeowners association.
        The association at the Breakers Brand, a 180 unit condominium development, sued the builder in 1999, alleging among other things, that leaky roofs, windows and decks led to a mold outbreak.
        The verdict won't be enforced exactly as outlined by the jury - Shea Homes and the association later reached a confidential settlement for a different amount- but it is another sign that mold is a major threat to the homebuilding industry.
        "It's the sexy issue these days," said John Chaix, a Costa Mesa lawyer representing the homeowners association. "Is it the next asbestos? I don't know."
        Homeowners increasingly complain about mold infestations, adding a potentially costly twist to construction defect lawsuits.
        Some builders have started filming parts of the construction process to defend themselves against allegations of shoddy workmanship. Mold is especially worrisome because it has been linked to a range of health problems.
        The suit against Shea dealt with damage to the homes, not personal-injury claims, Chaix said. The homes were built and sold between 1989 and 1992.
         Max Johnson, general counsel for Walnut-based Shea, declined to discuss the case, citing a confidentiality agreement.