Dive Brief:
- Kolter Signature Homes has settled a $36 million construction defects lawsuit brought by the San Matera Condominium Association in West Palm Beach, FL, for $22.5 million, according to the South Florida Business Journal.
- Kolter's insurance company will pay the largest portion of the settlement ($11.8 million), with the balance coming from subcontractors and the architect, according to The Real Deal.
- Homeowners in the 676-unit San Matera at the Gardens development said they have been plagued with construction defects — such as substantial water leaks — for six years. Residents claimed that shoddy work was concealed behind stucco walls and at the roofline when they purchased their units.
Dive Insight:
This case is just the latest round of high-profile construction defects cases brought against homebuilders operating in Florida. In February, KB Homes, the sixth-largest homebuilder in the U.S. paid $23.5 million to the Florida attorney general's office to settle claims of substandard work and deceptive business practices. Florida Attorney General Pam Bondi alleged that KB also did not honor valid requests for warranty work, although it eventually paid in excess of $71 million to remedy water intrusion issues.
Additionally, in Duval County, FL, a jury ordered D.R. Horton to pay almost $10 million to repair construction defects at one of its Jacksonville-area condominium developments in May. D.R. Horton said neglect and bad maintenance practices were at the heart of the problems, but residents said they had been fighting leaks, cracked stucco and window problems for nearly four years. D.R. Horton, which is facing similar complaints from another of its Jacksonville condo developments, said it would appeal the decision.
Justin Mihalik, president of the American Institute of Architects-New Jersey, told Construction Dive in July that construction defects can often be avoided if all parties on a construction project know their roles and abide by them.
