Homeowners feel abandoned by builders who used Chinese drywall

Builders abandon them, customers say, but firms say it is more complicated.

About 10 families in The Oaks development west of Boca Raton gathered at a neighbor's house last week to commiserate about the tainted Chinese drywall contained in most of their homes.

The homeowners have contacted their builder, Albanese-Popkin Group, hoping the company would pay to fix their properties or find them rental housing. But they say the builder has abandoned them – while at the same time marketing deeply discounted homes for sale in the upscale community along Clint Moore Road.

Albanese-Popkin says it is pursuing legal action against subcontractors and suppliers and seeking coverage from insurance carriers. The company also notes that federal agencies have not yet established a protocol for repairing homes with Chinese drywall.

The stalemate over the problem drywall is common across Florida, where as many as 36,000 homes could be affected. Homeowners want answers and are filing lawsuits, while builders insist their hands are tied as state and federal officials determine how to fix the homes and whether the drywall poses any health risk.

"There are thousands of people out there begging their builders to help them," said Allison Grant, a Boca Raton attorney who is representing three homeowners in The Oaks and more than 200 statewide.

If builders aren't yet able to fix the homes, they should pay for temporary housing or allow homeowners to live in unsold units, she said. They also can help residents obtain mortgage relief on loans the builders originated.

"Just do something," Grant said.

Kevin Rosen and his wife and two small children moved out of their house at The Oaks this summer, shortly after discovering it had the defective wallboard.

Rosen continues to pay his mortgage and maintenance fees, and he says Albanese-Popkin has not responded to his requests for help. He filed a lawsuit seeking compensation for fixing the four-bedroom house he bought for more than $1 million in 2006.

"Where's the good faith?" said Rosen, 39. "They didn't even organize a meeting in the neighborhood. They have not taken the initiative to help homeowners resolve the problem. The people here are basically on their own."

Albanese-Popkin, a partnership of Leonard Albanese and Edward Popkin, says it has spent three decades building custom estate homes in South Florida and Colorado. In response to The Oaks residents, the company issued a statement, which said, "This is a terrible situation for everyone who is caught up in it. We wish we could do more and had the answers that homeowners want. Given the circumstances, we are taking all the steps we can."

Some industry observers worry that builders agreeing to fix homes with problem drywall immediately could be held liable if the repairs don't work or if they aren't consistent with government guidelines that may come out.

But homeowners say builders are using the lack of government guidelines as an excuse to get out of having to pay millions of dollars for repairs.

Sunrise-based GL Homes and Lennar Corp. of Miami have agreed to fix homes at no cost to the homeowners. The builders are ripping out the drywall and rebuilding homes from the studs out – a method endorsed by scientists who spoke at a state Chinese drywall symposium in Tampa last week.

"We just can't wait" for the government to issue a protocol, said Heather Keith, a lawyer for GL who attended the symposium.

Large volume builders have the resources to more easily help homeowners, said Edie Ousley, spokeswoman for the Florida Home Builders Association.

Lennar, for instance, told federal regulators this summer it set aside roughly $40 million to repair 400 homes with Chinese drywall. That works out to about $100,000 per home.

Ousley said many smaller builders don't have that kind of money and would be forced out of business if they had to fix homes.

"They're just financially unable to do so," she said.

But Rosen's Coral Gables lawyer, Ervin A. Gonzalez, doesn't buy it.

Generally speaking, he said, smaller builders typically set up and fund corporations to build houses. They take the profits as salaries and give bonuses to shareholders, ultimately depleting the corporations of any money that could go to help homeowners repair defective homes.

"It's not illegal," Gonzalez said, "but it sure smells to high heaven."

Source: Paul Owers can be reached at Powers@Sunsentinel.com or 561-243-6529.
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