Insurance Dispute Lawyer Blog
Jason and Renee Niemann, a couple from Mandeville, Louisiana, purchased a home in 2007 in the Lakeside Village Subdivision in Mandeville, Louisiana. Unbeknownst to them, a subcontractor, Calmar Construction Company, installed Chinese drywall in the home during construction in 2006, and the Niemanns have been fighting the builder, subcontractor, and subdivision developer in court since discovering the defect in 2010.
Chinese drywall became popular amongt builders during the housing boom in 2004 because it was inexpensive and available in mass quantities. However, the defective drywall is infamous for emitting carbon disulfide, carbonyl sulfide, and hydrogen sulfide. These three sulfurous gases cause both irreparable damage to houses and severe health problems. Copper piping in the home begins to erode, taking on a black and powdery look, and residents begin experiencing respiratory issues and headaches. As a result, the house becomes uninhabitable and loses its value.
When the Niemanns signed the sales contract in 2007, they had no idea that Chinese drywall had been installed in their new home. On May 24, 2010, they filed an action in Louisiana state court, alleging breach of warranties and negligence and seeking damages from the builder, subcontractor, and subdivision developer, as well as the respective commercial general liability (CGL) insurance providers. The Niemanns argued that all three companies had been aware (or should have been) of the defects yet failed to disclose them at time of sale. As a result, they stated they had made a home purchase they would not have otherwise made, resulting in damages, economic loss, and a defective home that was unfit for its intended purpose.
During an appeal of a summary judgment order by the trial court, the appellate court asked the parties to submit briefs on whether the Niemanns had a right of action against both Calmar and Calmar’s CGL insurer, American Empire, for non-apparent damages inflicted on the house prior to sale. According to a recent Louisiana Supreme Court case, Eagle Pipe and Supply, Inc. v. Amerada Hess Corp., a plaintiff only has a right of action (or right to sue) for non-apparent damages inflicted pre-sale when there was an assignment of or subrogation of that right from the previous owner to the plaintiff. In plain English, the appellate court wanted to know if the subdivision developer and seller, Lakeside Village Development, had assigned the Niemanns its rights of remedies against Calmar and Calmar’s insurer. These rights only pass on to the new owner if specifically designated in the sale documents.
Because an appellate court can only review what is already in the record on appeal and not any documents not yet submitted into evidence, the court was unable to consider documents the Niemanns had obtained post-summary judgment that allegedly prove subrogation. As such, the court was unable to find any evidence in the facts that showed evidence of such subrogation and therefore affirmed dismissal of the Niemanns’ claims against American Empire.
With that said, there is light at the end of the tunnel. The Louisiana Code of Civil Procedure affords plaintiffs the right to amend their petitions. As such, the Niemanns will have the ability to amend their complaint and submit the evidence of subrogation they have found.
If you suspect your home was built with Chinese drywall, contact the Berniard Law Firm. Providing the best experts in construction and diagnosing the cause of damages, our law firm is fully capable of meeting your litigation needs.
Call the Berniard Law Firm Toll-Free at 1-866-574-8005, and an attorney specializing in construction negligence will be more than happy to help you get the outcome you deserve.