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Sunday, September 23, 2007

Lawsuits, recalls and the homeowner/homebuyer

Over several recent home inspections I’ve had reason to be educated about a number of class action lawsuits and recalls of building products and home appliances and home mechanical components. This can be a vexing issue for homeowners and a worrisome one for home buyers. The problem is made worse for everybody because there doesn’t appear to be any single place where the homeowner or home buyer can go to get to review a list of house and household products that have been recalled.

The issues span everything from the siding on a home to the furnace and beyond. In the 1990’s there was a big class action law suit against Louisiana-Pacific, a major building products supplier. It seems that a whole bunch of their siding products were defective and tended to be subject to warping and rot if not carefully and continually kept sealed and painted. Lots of lawyers made lots of money off that and some home buyers got money to deal with the issue when an official recall was issued. Of course, not every homeowner with L-P siding even got a notice and not everyone who got a notice decided to go for the settlement refund. And to make things worse, not everyone who collected from the settlement funds went on to actually replace the defective siding. So, there are still lots of homes today that have the L-P siding. Some home inspectors know about the lawsuit and settlement and know what to look for, but some don’t; so, it is still possible today to buy a home with L-P siding and get it inspected before closing and yet end up blissfully ignorant about the fact that you have a home with siding that is likely to rot. If the home inspector when you go to sell it is better than the inspector when you bought it, look out! It could end up costing you thousands to replace the bad siding.

The same thing happened a few years back with roofing. The Certain Teed company made some shingles that looked pretty good and were supposedly guaranteed for 20 years, but they started to crack and deteriorate in 5 years, sometimes less. There are still lawyers soliciting clients to participate in that class action lawsuit and lots of houses here in Michigan with those shingles on the roofs. More recently a whole bunch of brand name furnace manufacturers apparently fell victim to a defective secondary heat exchanger part in their high-efficiency, condensing furnaces (they all used the same inferior part) and now there are class-action lawsuits against most of these furnace makers and a recall is underway or proposed as part of a settlement. In my own home, I received notice of a recall of the Maytag brand dishwasher that I bought a few years back. I had returned the product registration card, so I was on file with the manufacturer. It turned out that the model and serial number of my unit was not on the recall list for that brand, but those that were on the list had a major fire hazard and needed to have a component replaced.

I did a bunch of on-line searches trying to find one spot where homeowners and home buyers could maybe go to see what lawsuits and settlements are out there about products like these that might be used in the construction of homes or as mechanical components in the home – I could find no such place. There is a site that seems to do a pretty good job on recalls for housewhold items, like appliances; so, you might want to check there. Other than that, as a home buyer, you are at the mercy of the home inspector to be knowledgeable enough to find these defects and point them out. As a home seller, you should have a good inspection done at the front-end of the process (see my post of September 12th – Ignorance is not bliss) to make sure that you know about these things ahead. It’s not a pleasant thing to discover that you may be on the hook for thousands of dollars worth of repairs if you want to save the sale of your home. Maybe I’ll do the research and put a page on my Milford Team Web site of all of the recalls that I can find taht might affect homes. Stay tuned.

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