Quote of the Day
"Our goal is to be the last man standing in every one of our markets.” - M/I Homes CEO Bob Schottenstein.
Homebuilder Legal Woes
Week In Review. North Carolina: A U.S. district judge has dismissed a Concord couple's lawsuit against Beazer Homes USA (NYSE:BZH), saying the couple failed to prove the homebuilder's lending practices resulted in foreclosures that contributed to falling property values... In September, a federal judge ruled that a Columbia woman failed to show damages from Beazer's actions because she hadn't sold her house and incurred losses. The cases illustrate the difficulties homeowners may have nationwide finding relief from the courts in a multilayered foreclosure crisis.”
Erin Brockovich Sets Sights on Lennar. “High-profile environmental advocate Erin Brockovich has been investigating possible health-damaging chemicals at a Lennar (NYSE:LEN) housing community in South Carolina. Next week, she will be unveiling test results that, she says, confirm the existence of methane and hazardous chemical contaminations at the site that are "of concern.” Such findings would run contrary to a recent ruling by the Environmental Protection Agency. Certain residents at Lennar's Pebble Creek community in the Westcott Plantation section of Charleston, S.C., have complained about health problems such as headache and fatigue for several years now.”
Construction-Defect Lawsuits Hammer Homebuilders, Insurers. “California's residential construction industry is approaching uncharted waters as a housing slump, tight liability insurance coverage and new laws for handling construction defect litigation all collide. The collision makes an already challenging business environment fraught with even more danger. Some attorneys, especially those representing subcontractors, say they fear for their clients' future… But there are some who see no such looming crisis. Legislation from the past few years actually resolved a lot of problems with how construction defect litigation was handled, said Mike Stretch, VP of member services in Sacramento for the California Building Industry Association.”
Developer's Repairs Remain In Dispute. NJ: West Deptford township will not release three performance bonds to local developer D.R. Horton (NYSE:DHI), since the developer failed to resolve some long-standing issues with property owners by May 1. The township committee agreed in March to release the performance bonds worth a total of $581,683 to developer DHI under the condition that improvements be made to the Grande at Kings Woods. Township Administrator Eric Campo: DHI has posted a total of 11 performance bonds for the development… An April 24 letter from township Engineer Edwin Steck indicated that the necessary repairs had not yet been completed.”
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