Gray•Duffy Negotiates Settlement for 13% of Amount Claimed in Multi-Party Construction Defect Lawsuit

July 2013

Overview

Ronald Mandel of Gray•Duffy’s Encino office successfully negotiated a $65,000 claim against the firm’s fireplace subcontractor client for $5,000.

Discussion

Extreme Fire Protection, Inc. v. Jim Bell & Karen Bell, et al.

The plaintiff, Extreme Fire Protection, was one of the subcontractors for the construction company and sued for money it was owed involving the construction of a single-family home in Santa Barbara, CA. The homeowners then filed a cross-complaint for construction defects.

Gray•Duffy’s client, Gil’s Fireplaces, was sued by the roofing subcontractor, Martin Roofing, who had been sued by the general contractor. The alleged defect attributed to Gil’s Fireplaces involved defective chimney flashing. As a result of this allegation, Martin Roofing insisted that they be indemnified for the damages and a portion of their attorney’s fees and demanded $65,000 from Gil’s Fireplaces. During direct settlement discussions with the homeowners, Mr. Mandel reached a settlement of $5,000, and obtained a good faith settlement determination to have Martin Roofing’s cross-complaint against the client dismissed. In addition, future defense costs, which would have been in excess of the settlement amount, were avoided.

Please Note: This article is necessarily general in nature and is not a substitute for legal advice with respect to any particular case. Readers should consult with an attorney before taking any action affecting their interests.