Compensating for Construction Defects

Our client, a public pension plan, had purchased a building as an investment.  A few months post-purchase, during the winter rains, the new owners discovered serious problems.

The pension plan solicited our advice soon after they started receiving complaints from tenants.  We sought redress for the initial repairs from the developer and general contractor, who refused responsibility.  As the complaints persisted and the pension plan continued paying for repairs, the full extent of the structural problems became evident, implicating not just the general contractor, but more than a dozen subcontractors.

Over the course of five years, we sought to negotiate with the group of contractors to cover the mounting costs of repairs.  The building, originally constructed for $19.8 million, ultimately required over $25 million worth of repairs while it remained occupied.  We introduced the testimony of several construction expert witnesses to connect the dots, outlining the relationship between the contractors and the defects.  Our persistent attention to detail ultimately prevailed, and before trial we successfully negotiated a comprehensive settlement with the developer, contractor, and the subcontractors that compensated for their losses on the repairs.

Ultimately, our client succeeded in repairing the building without significant tenant disruptions, and continues to count the tenants' rents among its revenues.

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