It is no secret that construction defect liability claims can become incredibly complicated. When something goes awry after tenants have moved in, the finger pointing game begins. Was it a design flaw or was something installed improperly? Did equipment fail or did the property manager improperly maintain it? Should the construction contractor have realized the engineers made a mistake? When the stakes become large, which insurance company should be on the hook?
Residents complained of odors from their neighbor’s units at The One Charles Condominium, a luxury condominium building located on Charles Street in Boston’s Back Bay. The condominium association sued the developer alleging that the heating, ventilation and air conditioning (HVAC) system was improperly built.
The association’s claim asserted that the HVAC system was trying to exhaust much more air than was being supplied (intake) and that the air supplied by rooftop air units was trapped in the common corridors of the building. This created a significant imbalance in the air pressure inside the units. Excessive amounts of outside air was drawn into the units directly through the building envelope and adjacent units. This resulted in odors and high interior humidity.
The association’s law firm, Marcus, Errico, Emmer, Brooks, P.C. (MEEB), retained CCA to help evaluate the problems and render an opinion regarding the cause(s) of the problems. CCA concluded that the designer of the HVAC system was responsible for the odor and high humidity the community had been experiencing. CCA’s engineering analysis together with anecdotal and empirical evidence demonstrated sufficient liability risk for the defendants and sufficient likelihood of a damage award against them to bring them to the settlement table. But the situation was a little more complicated.
It became apparent that the engineering firm responsible for the design was expecting the developer to handle the defense and pay the lion’s share of any damages the association was awarded. However, why would a developer willingly absorb the loss resulting from a settlement, when the association’s evidence suggested that the engineering firm was primarily responsible for the problem?
We all know there are no certainties in litigation. In this instance, like many others, the credibility of the expert testimony revealing the design flaw would ultimately become the critical factor in assigning liability. Let’s looks at the various parties’ positions:
CCA’s investigation and opinion became the basis for assigning responsibility and liability. While confidentiality provisions prevent disclosure of the settlement details, including who ultimately paid how much, the association’s board was not disappointed in the $12.25 million the association received.