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Block Wall Construction Defect
Homeowners Beware: A Potential Construction Defect Affecting Block Wall Construction

 

    

Part I.  Common Area Perimeter Block Wall Construction Defects

The real eye opener of the June Board meeting was the presentation by Charles Litt, representing the law firm of Feinberg Grant Mayfield Kaneda & Litt, a firm specializing in construction defect cases that have been brought by Associations against Developers. This firm, with a history of successful litigation in a number of block wall defect cases, has been retained by the Association to coordinate the inspection of common area perimeter walls and to make a demand for repairs on Del Webb/Pulte.

Since the ten-year statute of limitations on construction defects begins to lapse for Sun City in about 90 days, the Board deemed it important to take this action now to preserve their statutory rights. As a result, the firm representing SCACAI initiated an NRS Chapter 40 filing against the Developer to stop the running of the statute while the matter is being pursued under Nevada law.

This filing is the same type of filing that occurred in October 2006, later certified by the court as a class action on behalf of Sun City homeowners in the KITEC plumbing matter. In this current instance, in contrast to the KITEC filing, the Chapter 40 filing is designed to protect Association maintained property, not pertimeter block walls that are between homeowners at different elevations.

And including Villa Neighborhood Duplexes.

The scope of the firm’s work is necessarily limited to all common buildings, some civil improvements, perimeter block walls within the common areas, perimeter block walls facing a golf course, PLUS all homes within the Villa Neighborhoods. With respect to the Villa Neighborhoods, the inspection process will include common area property and the duplex units (roofs, exterior, and the concrete slab).

What about the statute of limitations?

In Nevada, there are three statute of limitations related to construction defects. According to the law firm’s website, there are 6, 8, and 10-year statutes, depending on the nature of the defect. In the case of obvious defects the statute is 6 years, while in the case of hidden defects, the statute is 8 years.

A 10-year statute exists only in the case where the developer knew or in the exercise of reasonable diligence, should have known about the defect at the time of construction which runs from the date of substantial completion of the home.

Additional information.

The selected law firm provides additional information on construction defects on its website at http://www.feinberggrant.com, including a quite helpful FAQ page under the heading “Defects.” Under "Defects," click on "FAQ NV" for information on Nevada.

Part II.  Implications for homeowners NOT covered by the Common Area inspection process.

City of Henderson Code Violations Noted.

Mr. Litt acknowledged that based on preliminary inspections of common area block walls already conducted, code violations have been noted. When asked to elaborate, Mr. Litt volunteered that some sections of the block walls already inspected failed to contain steel reinforcing bars, commonly referred to as rebar. When properly constructed according to City code requirements, designated sections of block walls should contain steel reinforcing bars encased in cement that is poured into the hollow concrete blocks.

Below is a sample of the type of language used by the City of Henderson in addressing retaining wall construction. Note that the below standard is an updated revision of earlier language (not shown) that was in effect at the time of construction.

Section 1806.1 General. Retaining walls shall be designed to ensure stability against overturning,
sliding, excessive foundation pressure and water uplift. Retaining walls shall be designed for a
safety factor of 1.5 against sliding and overturning when considering load combinations that do
not include seismic or wind. Retaining walls shall be designed for a safety factor of 1.1 against
sliding and overturning when considering load combinations that include seismic loads.
Retaining walls shall be designed for a safety factor of 1.3 against sliding and overturning when
considering load combinations that include wind loads.

A block wall under construction. (For illustrative purposes only)

This internet obtained photo at left illustrates the process of block wall construction, showing the presence of steel reinforcing bars encased in cement and coming up through the middle of the cement blocks that are placed and centered (or offset) one at a time on top of one another.

The problem to be address by the Feinberg Grant law firm is the apparent absence of some steel reinforcing rods in some sections of wall.

 

 

How extensive is the rebar problem?

That's unclear. Other than advising of the presence of the problem based on a preliminary inspection of some common area block walls, Mr. Litt had no additional information at this time. Mr. Litt said they will be making regular reports at future Board meetings on the status of their findings.

Given the nature of the problem disclosed, the absence of rebar poses at a minimum a spotty problem. In other words, it's reasonable to conclude that all walls will contain some rebar. Whether the walls contain all of the rebar required by City code is another matter. It is also important to understand that not all homeowners with a perimeter block wall are equally affected by the absence of rebar. Some homeowners may have perimeter or side lot block walls with no rebar problem present while other homeowners may have such walls with a rebar problem present. Based on preliminary inspections, it seems likely that portions of many block wall structures will exhibit some degree of this problem, recognizing that some homeowner-responsible perimeter block wall structures for any given street can be well over 900 feet long.

You can glean a hint of that potential problem by pursing the law firm's list of successful cases involving block wall defects, with one of their larger cases (Legacy Association) valued at $3.5 million.

When asked about the status of block walls outside of the common areas, such as homeowner perimeter and side walls, Mr. Litt could not comment except to say that based on their preliminary inspection of common area walls there is no reason to believe that homeowner-responsible block walls were not similarly constructed with similar results.

A material defect?

Is the rebar defect potentially material, this is, having some structural significance? That all depends on the scope of the problem that is disclosed from the inspection process. Rebar is added to block walls to provide structural integrity and to prevent horizontal movement of the wall. The absence of required rebar can adversely affect the ability of a wall to withstand stress from ground movement and from pressure that can build up against the wall. For example, the weight of such pressure against a block wall can build up over time from excessive rainy periods or from a leaky hose or faucet left unattended to saturate the ground.

The issue of any potential problem, to the extent a rebar problem exists, is exacerbated as the height of the wall increases. In other words, an 18’ block wall improperly reinforced would likely pose a greater concern compared to a 3’ wall that was improperly reinforced.

What about earthquakes?

Ground movement from earthquakes can put added stress on block walls. Surprisingly, the state of Nevada, primarily from events in northern Nevada, is third behind Alaska and California in the number of major earthquakes. Some Reno area quakes have been known to be felt as far away as San Diego. Unknown to most residents, the entire state of Nevada is literally riddled with geological faults (mostly inactive) as this map of the state illustrates. [Under Tools in the upper left hand column, click on the zoom-in button (+) and then on the area where Nevada is generally located. Do it again to obtain a larger image. Then check the State box for visable faults and hit the refresh button in the right hand column menu. Backing out from this U.S. Government Link can pose some difficulty. The entire state of Nevada is literally strewn with hundreds of faults.]

More disturbing and specific to the Las Vegas area is information from in the 1999 Las Vegas Review Journal article and the 2004 article from the Las Vegas Sun, where it states that "a quake causing rampant damage could happen in Las Vegas along one of a number of faults around the valley," and in the Sun article, "the [new] research found that the ground [in the Las Vegas Valley] is less stable than previously thought and more prone to shaking in the event of an earthquake . . . ." And finally, for information on Nevada's major earthquake history, click on this Link.

Was this problem a design defect?

According to Mr. Lit, this is not a design defect since the construction plans invariably specify the legal code requirements.  What typically happens, he said, was that at the subcontractor level in the field as the work is being performed, the construction crew may not be following proper procedures for any number of reasons. While some walls may be OK, portions of other walls may lack rebar where it was required.

How to test for the presence of rebar?

There are radar, thermal imaging and similar detection tools available to determine the vertical placement of steel reinforcing rods within block walls. Such testing to be conducted by a qualified engineering firm will determine the presence or absence of rebar.

What's the remedy: a repair or money?

When asked about the remedy, Mr. Litt said that the Developer will be asked to correct the defect by inserting rebar where required by City code.

But will the Developer actually perform that repair task? Not likely. In the case of the KITEC experience, and unlike the REHAU matter, the Developer performed no work at all, while choosing to mitigate the plumbing defect problem with money damages paid out to homeowners. There is no reason to believe that this will not happen in the Association's Chapter 40 case to remedy the absence of rebar in their perimeter block walls. A final answer will have to await the outcome of negotiations.

Once the construction defect has been mitigated by the payment of money damages, the Association will be free to do as it pleases. They can have the remedial work performed by a block wall contractor (less likely) or they can bank the money received in the settlement (more likely). In other words, they can do nothing about the rebar problem and choose to accept the risk of future wall failure, considered to be small. In the unlikely event of any future wall failure due to the rebar issue (not likely in the absence of a major earthquake), the Association can fix that limited problem while retaining the remaining settlement monies for other purposes. As in the KITEC settlement, homeowners had the option of doing nothing or of addressing the dezincification problem.

Which block walls are covered by the Association's inspection process?

The ongoing block wall inspection process covers perimeter block walls bordering on common areas, including those block walls that border on a golf course.

   Shown at left is one example of a block wall along Sun City Anthem Dr. just south of Hampton that borders on common element property. That block wall and similar walls adjoining common element property are covered by the Association's inspection process.

In other words, those homeowners' perimeter block wall is forever protected by the Association's efforts.

 

Which block walls are NOT covered by the Association's inspection process?

Walls that are NOT covered or protected by the Association's inspection process include the following:

           (1)  All side block walls, whether or not such side block walls are connected to a perimeter block wall that adjoins a common area or the golf course;

          (2)  All perimeter block walls, of the type shown at left, that separate at the rear property line one homeowner from another homeowner.

Note: This photograph is illustrative only and does not show property belonging to Ron Johnson

Whose perimeter block wall it that?

Was that block wall constructed on the property line (assuming one can even make that property line determination), or was it constructed in front of or behind the property line? Legally, that's unclear. But it's my understanding, subject to clarification, that the block wall was supposed to be constructed on the property of the lower elevation property. In the past, we have been told by the Association that that wall (of the type illustrated above) is legally owned and is required to be maintained by the property owner at the lower elevation. That Association advice or injunction, however, may or may not necessarily conform to the actual property line boundaries, although we would like to believe so.

What about liability?

As a result of the Association's advice concerning owner responsibility, liability and damage to the wall is the responsibility of the property owner(s) whose landscaped grounds are seen in the foreground in the above photograph. Accordingly, not liable are the property owners whose homes are partially visible along the top of the wall. Of course nothing is quite so absolute when it comes down to contested issues of liability, the courts and insurance carriers. Ultimately, there are many factors that determine household and property liability, a topic I will leave to professionals to work out.

Who gets the money in a monetary settlement?

In the case of the Association, that's not at issue. The Association gets the money to dispense as they deem necessary. Unless I'm naive, which is possible, that means the Association will wait until there is a demonstrated need to address a particular wall problem.

However, in the case of the homeowner-responsible block walls, that issue could become a little sticky. One might suppose that both upper and lower situated property owners have a shared interest in maintaining the integrity of the block wall separating their respective properties. But that shared interest does not necessarily dictate who is legally entitled to settlement monies in a Chapter 40 case. Technically, at least based on the above reasoning concerning wall ownership and liability, any settlement monies would flow only to the property owners situated at the lower elevation.

Are upper level property owners out of the block wall picture?

Upper level property owners are in a unique position when it comes to the issue of block wall movement. From a practical standpoint, the only property owners that have both the means and presumably the interest in determining block wall movement are those owners whose homes are situated on the upper level. For example, I know of one upper level property owner with a home that looks over the one below that has been measuring the movement of his perimeter wall. I suspect that Pulte has dealt with block wall movement issues on behalf of upper level property owners in cases involving land settlement issues. How those cases were ultimately resolved is unknown to me.

Letter from law firm in the works.

Additional information is forthcoming in a letter to be sent out by the law firm to all homeowners.

What Association information will be available for homeowners who may be concerned about their own side or perimeter block walls?

According to president Roz Berman, Board members Bob Frank and Barry Friedman are working on some type of program that will attempt to address the concerns of homeowners with block walls that are not covered by the Association’s legal action. Subject to change, that program will take place sometime in late September. One intent of the program will be to provide homeowners with relevant information concerning this issue. Another would be to provide homeowners with contact information for those law firms (other than Feinberg Grant) that would be willing to accept construction defect inquiries and cases.

Will Association-provided homeowner information efforts actually meet homeowner needs?

It's highly doubtful that Association assistance will adequately address homeowner needs. With all due respect to the efforts of Board members Frank and Friedman, I do not see how proposed Association seminars with homeowners will be of material assistance to anyone other than to the Association. It's apparent to me that such planned assistance, as currently envisioned, will actually be counterproductive and not in the homeowners' best interest. It's my opinion that Association efforts will actually meet a number of undisclosed objectives that are designed to favor the Association against the interests of homeowners with perimeter block walls that do not adjoin common element or golf course property. Why counterproductive?

Such Association efforts will:

Will homeowners be able to retain the services of Feinberg Grant Mayfield Kaneda & Litt?

That’s not too clear. According to Mr. Litt, “Yes.” However, according to Roz Berman, who challenged Litt's response at the Board meeting, the answer is a resounding, “NO!” While the firm accepts construction defect claims from individual property owners, as Mr. Litt would readily acknowledge, it appears the Association has obtained a private sub rosa agreement from the law firm not to accept complaints from Sun City Anthem homeowners. In other words, individual homeowners are left to find law firms that may not have the level of expertise or track record in pursuing such claims.

It's unclear whether such an agreement is legal, but we’ll leave that matter to others to work out. Whether or not such an agreement is legal, the obvious political consequences of that decision for the Board may prove to be unacceptable.

The class action imperative.

As a final thought on this issue, and despite the fact that other firms also take construction defect cases, the legal case for homeowners against the developer on the same defect would be greatly enhanced by using the same law firm that will be pursuing a settlement. That simply makes common sense. So, why does the Board want to freeze out the homeowners? One reason might be the Association is wary that settlement issues on their "single" case could get hindered or bogged down with efforts to resolve numerous block wall issues for individual homeowners.

But there may be a simple solution to resolve the potential number of cases that might be involved. Given the potential for commonality of interests, as in the KITEC case, it makes no sense that individual homeowners will be forced to seek individual remedies. As a consequence, I see no obstacle to the block wall matter, based on the results of the ongoing common area inspections, being resolved not individually, but through the class action process. Requiring thousands of individual Chapter 40 claims is not a satisfactory answer and in no way will such sporadic efforts adequately address the defect issue for all block walls in Sun City.

Accordingly, I believe it is imperative for homeowners to join in some type of consolidated effort that will address at once the concern of all homeowners with block walls that are not covered by the Association's ongoing inspection process.   

 

Ron Johnson, 6 July 2008