Judge awards VA Homeowners $2.6M in Chinese drywall case

Posted on April 9, 2010 by mrwilliamsburg

Consumer advocates hailed a ruling Thursday in Louisiana federal court that awarded $2.6 million to seven Virginia families who bought homes built with Chinese drywall.

U.S. District Judge Eldon Fallon handed down the first award in a Chinese drywall lawsuit. He awarded property damages, personal property damages, and an amount for loss of use and enjoyment.

The case is considered a bellwether for numerous federal class action lawsuits consolidated in New Orleans. It also provides guidance for hundreds of other cases awaiting trial in state circuit courts.

The ruling lends legal weight to a recent federal policy decision that the only safe method of dealing with Chinese drywall is to gut a house’s interior of all drywall, wiring and plumbing.

Fallon used a formula of $86 a square foot for a typical home, and awarded $100,000 to most of the seven families for loss of use and enjoyment.

But, recovering from the Chinese company that made the drywall –Taishan Gypsum – may be more problematic. Taishan was served notice of the suit, but failed to respond, and a default judgment was entered against it in a previous ruling.

Chinese drywall has concentrations of sulfur and other substances that produce corrosive gases and odor, which leads to corroded metal. From 2004 to 2006, when the building boom and hurricane repairs created a domestic shortage, 500 million pounds of drywall were imported – and 60 percent of the drywall came through Florida ports.

Fallon’s ruling enshrines several scientific findings about Chinese drywall into federal case law, most of which had been made public in previous studies:

Chinese drywall has a significantly higher average concentration of strontium and significantly more detectable levels of elemental sulfur.
Chinese drywall releases reduced sulfur gases.
The sulfur gases released by Chinese drywall are irritating to the human body.
The sulfur gases cause offending odors in homes, making them hard, if not impossible, to live in.
The sulfur gases are corrosive to metals, particularly copper and silver.
The corrosion on metals caused by the sulfur gases causes premature failure of electrical and mechanical devices.
The corrosion on metals caused by the sulfur gases emitted by Chinese drywall poses a fire risk.

Click here to read the ruling form the court

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The Orlandos bought their home in the Wellington community of Williamsburg, Va., for $369,500 in June 2009. Fred Orlando had gotten a job promotion and the family moved from upstate New York to the Mid-Atlantic.
Excited about the shift and expecting it was the home they would retire in, they paid $50,000 to have the in-ground pool built within weeks of moving in.
Not long after the finishing touches were made on the pool, the family received a letter from Dick Ashe, the builder of the home—there were possibly 172 sheets of toxic Chinese drywall in their home. The Orlandos discovered that the drywall had Venture Supply (i.e. Taishan) stamped on the back—proving it was manufactured in China.
Opening the windows to get fresh air into the home during 90-degree heat brought neighbor Bill Morgan over to inquire if the family had Chinese drywall in their home. The Orlandos were not alone.
They had first noticed a smell when they toured the house and thought it was from the previous owner’s two children in diapers. After they moved in, the smell got progressively worse.
The Orlandos had all the carpets in the home cleaned, but the smell did not go away. Mrs.. Orlando describes the odor as similar to the smell of spent fireworks. Headaches and rashes followed, as well as failure of their water heater and problems with the HVAC unit.
Seven months after moving in, the Orlandos moved into a rental home and their health improved within two weeks, said Orlando.
She said the family wants to fix/rebuild the home rather than sell it.
“We really like it and we put in a new pool when first moved in,” she said. “I am just thankful for the judgment. It’s the beginning of the process of us becoming whole again.”
Assuming remediation of their home is complete within six months of the trial, the Orlandos are entitled to $307,905.44 in damages, plus an award for loss of use and enjoyment of the home and personal property to be determined by the court.

Mr Williamsburg, Revolutionary ideas on real estate!Hampton Roads Virginia