YOUR ACTIVE ADULT SPECIALIST
Since we began our series on Kitec Plumbing, many people have contacted me concerning how to detect Kitec and what to do if it exists in their home… or in a home that an Agent is selling. Today’s Article will cover the possibility of getting repaid for the cost of replacing Kitec Plumbing and repairing the damage.
As always, if you have any questions about your business, real estate, estate planning, or any other legal issue, please let us know by e-mailing me at firstname.lastname@example.org.
Clients of ours who have obtained estimates to replace the Kitec plumbing in their homes have reported costs of $8,000-$10,000. Of course, this amount would vary based upon the size of the home and the extent that walls and ceilings may have to be opened. This is most likely far less than the cost would be of repairing the damage after a failure of the piping causes flooding in the home. Naturally, these concerns give rise to the question: Who should pay for the repair or replacement of Kitec Plumbing? This question has a variety of possible answers.
1. Pay it Yourself – While this answer is generally the least desirable approach, anyone dealing with Kitec plumbing should focus first on alleviating the risk of flooding from a pipe failure. Plumbers may recommend some lower cost immediate solutions such as reducing the water pressure if replacement is not affordable. Merely because a property owner pays to replace the plumbing does not mean that they waive any claims for recourse against anyone who may have breached a duty to disclose the Kitec’s presence in their home.
2. Join the Class Action Lawsuit – As you should be aware, the present interest in Kitec plumbing was stimulated in part by a $125 million Settlement entered in Federal Court between Ipex (maker of Kitec) and related parties, as Defendants, and various damaged property owners, as Plaintiffs. You can get information on the Settlement and Claim forms at: http://www.kitecsettlement.com/ At this point it is unknown how much the Claimants will receive since that may depend upon how many claims are filed. Significantly, this Class Action and Settlement appears to be the only legal recourse remaining against the Kitec manufacturer or the developers of real property due to the expiration of various claims deadlines (Statutes of Limitation).
3. Lawsuit against Third Parties – Many property owners learned about the Kitec issue for the first time through our Blogs and other recent communications. Under California law, a Seller of real property is required to disclose to a Buyer any defective conditions affecting the Property of which they have actual knowledge. While original owners of the Property should have had knowledge of the Kitec issue, many did not disclose this to subsequent owners who now must deal with this problem. In such cases, the injured Buyer may have legal recourse against the Seller for all of the repair and replacement costs as well as legal costs incurred. Similarly, a Buyer may possibly have a claim against real estate agents involved in the transaction if they had or should have had knowledge of the problem. While there are time limits and other legal requirements for such a legal action, recourse against a third party could involve the following:
a. Small Claims Court – In California, claims for $10,000 or less may be brought in the Small Claims Court in every County. These actions tend to be fast and low-cost but parties cannot be represented by attorneys (which keeps it fast and low-cost). Small Claims is typically exempt from Contract requirements for Mediation and possibly Arbitration.
b. Mediation – Most real estate purchase contracts contain certain Alternate Dispute Resolution provisions which require the parties (Buyer and Seller) to participate in non-binding Mediation before filing any lawsuit or Arbitration. Mediation can be an effective means of resolving claims… depending upon the willingness of the parties and their interest in avoiding the costs and risks of further legal action.
c. Lawsuit / Arbitration – depending upon the Contract provisions or the agreement of the parties, a Buyer’s claims against a Seller and possibly against involved agents must proceed through either a lawsuit filed in the Superior Court or through binding Arbitration. In these matters, the parties are all typically represented by legal counsel. The key here is that the Buyer must allege: (1) that the Defendants knew about the Kitec plumbing; (2) that the Defendants failed to disclose it; (3) that the Buyer had no knowledge of the Kitec in the Property; (4) that the presence of the Kitec materially affected how much the Buyer would have paid for the Property if it had been disclosed; and (5) as a result, the Buyer suffered damages. Generally, the defendants would deny these allegations and the legal matter would proceed forward until either a Trial or Arbitration occurs or the parties reach a Settlement themselves. Settlement generally occurs in 90+% of cases at some point in time.
If you or someone you know is facing Kitec issues, please feel free to forward this Article to them as well as Parts 1 and 2. Here are links to these prior Articles:
Kitec Plumbing Part 1: Should You be Concerned?
Kitec Plumbing Part 2: Failure Causes & Recommendations
For over 20 years, the attorneys of BPE Law Group have been serving the legal needs of our clients wherever they may be and as complex and unique as the situation may demand.
This article is not intended to be legal advice, and should not be taken as legal advice. Every case requires review of specific facts and history, and a formal agreement for service. Please feel free to contact us if you need legal advice and are interested in seeing if we can help you.