Nevada Court Cancels Big Construction Defect Award

A multimillion-dollar construction defects award was erased Thursday by a unanimous Nevada Supreme Court decision that held the case had been improperly given class-action status by a lower court judge.
The high court ruling favors Beazer Homes Holding Corp. and went against homeowners who sued the company after finding cracks in foundations, walls and driveways at their North Las Vegas properties allegedly caused by expansive soil conditions.

“Because single-family residence constructional defect litigation often raises diverse, individualized claims and defenses, we conclude that, generally, the requirements for class action certification cannot be met,” Justice Jim Hardesty wrote.

During arguments before the Supreme Court, a Beazer attorney said a defect lawsuit involving The Villages at Craig Ranch homes should never have been made a class-action case, and that a $7.3 million jury verdict should be overturned. With interest, costs and attorneys fees, the total value of the case is about $15.6 million.

But lawyers for 200 Craig Ranch Village homeowners said class-action status was appropriate because the damages suffered were predominantly related to concrete pads that did not conform to the subdivision’s soil conditions. The homeowners had sought nearly $24 million.

The case involving Atlanta-based Beazer, which built the homes between 1994 and 1999, resulted in one of the longest and largest construction defect trials in Nevada history. The trial that began in 2002 lasted three months.

The Supreme Court ruling calls for new trials on all issues in the case.
Beazer attorneys have said a retrial of each case would be best for both the court system and the individuals with claims.

In the trial that ended in February 2003, a jury cleared Beazer of any violations of implied or expressed warranties and found contributing negligence by both the class-action members and Beazer — 7 percent on the part of the homeowners and 93 percent by the builder.