Construction-defects lawsuit settled $3.5 million for 41 Folsom families
Pam Slater
A second lawsuit over construction defects in homes built in a Folsom subdivision by the now-defunct Sunland Communities of Northern California Inc. has been settled out of court for $3.5 million.
The award will go to 41 families in the Lexington Hills subdivision who filed suit more than a year ago alleging shoddy workmanship and materials, failure to follow uniform building codes and other construction problems.
The agreement was finalized just before the case was to go to trial last month.
The settlement is the second involving Sunland in the last three years.
A Sacramento Superior Court jury in February 1995 awarded 30 Lexington Hills families $4.4 million and found that Sunland acted with malice. The jury award eventually was reduced to $3.1 million during settlement proceedings before it was to be heard on appeal.
"I think the previous lawsuit reminded (Sunland) who their customers are," said Mitchell S. Ostwald, the Sacramento attorney for both sets of homeowners. "I think they forgot that they were selling a product and that they had a responsibility after they took their customers money. Service is much more than lip service. "
Sunland attorney Edward J. Wright Jr. said the settlement was fair. He said his client and its insurance carriers would pay $3.25 million of the settlement with the balance being paid by window subcontractors. "Without question, there were certain problems," Wright said.
The homes, some of which sell for as much as $250,000, were built between 1989 and 1991. They are off North Lexington and Keller Circle near Highway 50 and Scott Road.
Records at the Contractors' State License Board show the license for Sunland has not been renewed since it expired in early 1995.
Lexington Hills homeowner and plaintiff Vikki Lozano said she is relieved the litigation is over.
She said she didn't join the original lawsuit because she believed the problem would be solved by the developer. Then her upstairs bathtub - empty at the time - came crashing through the ceiling. "I said 'That's it. '"
She said they had tried working with the developer, "but we were fed a lot of lies and misinformation. Now that this nightmare is over, we can fix our homes and get on with our lives.
Despite the construction problems, Ostwald said that the houses can be made whole. "Our engineers and contractors have not only repaired some of the homes, but they have determined that all of the homes can be fixed. " he said. Many of the homeowners, he said, are anxious to get at least some repairs completed before the predicted El Nino rains arrive. "Finally, maybe they can enjoy the American dream without worrying about the structural integrity of their homes. " Ostwald said
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