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Allwin v. Russ Cooper Associates Inc.

Court of Appeals of South Carolina

January 16, 2019

Maria Allwin, Appellant,
v.
Russ Cooper Associates, Inc., Buffington Homes, L.P., and Shope Reno Warton, Defendents, Of whom Russ Cooper Associates, Inc., and Shope Reno Warton are the Respondents. Buffington Homes, L.P., Third-Party Plaintiff,
v.
Albrecht Environmental, Inc., All Points Construction, Inc., Patriots Drywall, Inc., Picquet Roofing, Inc., Sprayseal Foam Insulation, and Tischler Und Sohn (USA) Limited, Third-Party Defendants. Appellate Case No. 2016-000471

          Heard May 9, 2018

          Appeal From Charleston County J. C. Nicholson, Jr., Circuit Court Judge

          Robert T. Lyles, Jr., of Lyles & Associates, LLC, of Charleston, for Appellant.

          Paul Eliot Sperry and Tyler Paul Winton, of Carlock Copeland & Stair, LLP, of Charleston for Respondent Shope Reno Warton; L. Dean Best and Jenny Costa Honeycutt, of Best Honeycutt, P.A., of Charleston, for Respondent Russ Cooper Associates, Inc.

          OPINION

          MCDONALD, J.

         In this construction defect litigation, Maria Allwin appeals the circuit court's grant of summary judgment in favor of Russ Cooper Associates, Inc. and Shope Reno Wharton (collectively, Respondents). As the circuit court properly found the statute of limitations bars Allwin's claims, we affirm.

         Facts and Procedural History

         In July 1992, architectural firm Shope Reno Wharton (Shope Reno) issued a set of plans to Connecticut residents Maria and Jim Allwin for the construction of a second home at 133 Flyway Drive on Kiawah Island. Shope Reno completed the final plans for the 11,000 square-foot beachfront home in August 1993. In May 1994, general contractor Russ Cooper Associates, Inc. (RCA) completed construction.

         The Allwins were first informed of issues with the home by Robert Cowan, who lived there as the Allwins' guest in the late 1990s and early 2000s. Cowan observed and notified the Allwins of numerous problems with the roof, chimneys, exterior walls, windows, doors, patio, and basement. He also observed and reported interior water damage to hardwood floors, drywall, wallpaper, and subfloor framing, as well as mold, mildew, peeling paint, and water stains.

         From 1999 to 2002, Cowan reported numerous and repeated leaks including: at least twelve leaking roof incidents; chimney and fireplace flue leakage; leaks at wall vents, louvers, or within exterior walls; leaking windows; leaks on the beachfront side of the house; and leaks in the basement where the patio connected. In March 2001, Cowan wrote to the Allwins, "Roof leaks and painting appear to be the most important problems at this point." On September 4, 2001, Cowan prepared a moisture detection report noting unacceptable moisture meter readings.

         In late 2001, the Allwins engaged Gamble Home Services (Gamble) to serve as the home's property manager. In 2001 and 2002, Gamble notified the Allwins of roof leaks at least twice. Between 2001 and 2008, Gamble reported leaks near windows and doors, air intrusion through unsealed penetrations in the building envelope, and a patio leak causing subflooring damage. Gamble also told the Allwins of numerous and repeated instances of interior water damage, including mold and mildew, caulking cracks at windows, drywall and wallpaper damage, trim cracks at windows, ceiling damage and stains, condensation in the basement, and warped hardwood flooring.[1]

         In 2003, the Allwins hired Milton Morgan to oversee repair and maintenance work performed by Dan Buffington of Buffington Homes. Morgan notified the Allwins of roof defects on at least three occasions and proposed roof repairs ranging from $15,000 to $35,000. He also reported exterior trim rot, mold and mildew. Morgan retained architect Roy Davis Smith, who recommended water testing to determine the sources of the basement, window, and door leaks; Smith also suggested taking humidity readings throughout the house to address the mold.

         In June 2003, Buffington hired Campbell, Schneider, and Associates, LLC (CSA) to survey the house and determine the source of "isolated areas of damage and fungal growth." CSA's August 2003 report noted water damage and mildew throughout the home and opined "[t]he damage to this home appears to be the direct result of numerous sources of unconditioned air infiltration, steep thermal gradients on finished interior surfaces, and ongoing water intrusion around windows, at roof valleys, and at several sub-grade locations." CSA recommended the source of the water leaks be investigated from the exterior, which would require the removal of certain windows and roof sections. CSA concluded "outside air infiltration is the dominant source of moisture in the home and can be resolved by sealing air leakage paths and pressurizing the home. Isolated cases of water damage can be investigated and repaired on an individual basis."

         In July 2003, Buffington recommended a complete roof replacement. In addition to informing the Allwins of roof leaks and defects, Buffington reported exterior trim rot and damage to interior finishes caused by defective construction, including drywall damage, buckling and damaged hardwood floors, mold, mildew, and peeling paint. Regarding the patio and basement, Buffington recommended removing the patio tile, installing waterproofing where the patio connects to the house, and replacing the patio tile to slope away from the home. On November 13, 2003, Morgan provided a written scope of repair that included instructions for Buffington to, among other things, "remove water damaged drywall from various bath and bedroom ceilings," "remove window and door casings[,] which display evidence of water intrusion on adjacent wall surfaces," "remove and replace window sash with broken air seals," "correct defects in roof valleys," and "explore and rework earth fill around foundation walls." Based on Morgan's advice, the Allwins proceeded with the more limited scope of repair as opposed to the complete roof replacement Buffington recommended.

         In January 2004, however, Buffington again apprised the Allwins of problems with the roof and recommended a more aggressive repair plan than that suggested by Morgan. Buffington wrote:

South Carolina has a 13-year statute of limitation[s] for water intrusion.[2] Your home is approaching that deadline. . . . [T]he roof was so poorly installed the only way to properly repair the roof is to replace it. When properly installed, your roof should last a lifetime. Even an asphalt shingle roof will last 15 to 20 years. I strongly urge you to contact the builder/roofer who installed the roof. If he is unwilling to accept responsibility and replace the roof, I would suggest enlisting legal counsel. Replacing the roof will necessitate removing and replacing much of the siding, thus, the cost for roof replacement will be over $500,000.

         Buffington proposed further investigation into the basement leaks and air and water intrusion at the windows. He again advised the Allwins of damage to the drywall and hardwood floors, as well as the problems with mold, mildew, and peeling paint.[3] He further notified the Allwins of defects in the exterior walls of the home, including rotten studs and sheathing requiring replacement of exterior siding and trim. Ultimately, the Allwins paid Buffington $359,728.21 for the 2004–05 repairs. Following the completion of Buffington's repairs, Gamble invoiced the Allwins $979 for repair work in November 2005; this work included caulking the bottom of the exterior cladding at the rear patio to prevent leaks into the subfloor.

         In March 2004, the Allwins submitted a property damage claim to AIG, their hazard insurance carrier, reporting active water intrusion through the roof, windows, and doors. AIG's engineer inspected the house, photographing open and obvious defects in the roof system, window leaks, leaks in the basement, and mold and water-damaged drywall in the interior. AIG subsequently denied the Allwins' claim, citing the longstanding construction defects noted in both CSA's August 2003 report and the report prepared by AIG's engineer.[4]

         In 2006, the Allwins hired realtor Cynthia Noble of Kiawah Island Real Estate, who obtained a home inspection from Complete Inspection Services (CIS) before listing the house. CIS's July 2006 report noted roof leaks, prior termite activity, damaged wood cladding, water infiltration at rear doors, water stains at rear basement walls, damaged hardwood flooring, water stains, mildew, and damaged drywall. CIS recommended repairs to the roof, investigation of termite activity, and inspection of the flashing and subflooring at the rear doors. Albrecht again inspected the home and issued a July 2006 report proposing $19,150 in mold remediation.

         With the Allwins' consent, Noble requested and Buffington prepared a September 2006 estimate of repairs necessary to address the ongoing problems. Buffington proposed $282,850 in repairs to the roof, exterior walls, several windows and doors, the basement, and damaged flooring, as well as mold remediation. Noting the proposed roofing repairs were "only temporary," Buffington again recommended a complete roof replacement. In 2008, Maria Allwin[5] hired consultant Victoria Stein of Atlantic Builders to evaluate the home. Stein's October 2008 report summarized her investigation of water intrusion issues and offered suggestions for future action.[6] Stein's report included a timeline chronicling the home's history of longstanding water intrusion and prior repairs, along with the findings of prior consultants. Although Stein opined the heating, ventilation, and air conditioning (HVAC) system was the primary cause of the mold and mildew, she expressly noted several existing defects were unrelated to the HVAC issue, including drywall damage under roof valleys, buckled hardwood flooring, and moisture in the basement area beneath the pool deck.[7] Stein suggested Allwin make repairs and seek legal counsel. Finally, she stated "[t]he list of items that could have been laid as the responsibility of the builder are numerous but bottom line is that the Statute of Limitations ran out in May 2007."

         In 2009, Allwin met with engineer Skip Lewis to discuss management of the ongoing maintenance and repair costs. Although Lewis was to perform a property condition assessment and develop a life cycle repair for maintenance of the house, this work was never completed.

         Allwin retained legal representation in March 2009; counsel made arrangements for engineering firm H2L to survey the house for structural issues, including evaluating the roof and windows. On May 26, 2009, H2L presented a $45,000 proposal to conduct a building condition survey, including a visual inspection of the building envelope, windows, and cladding. Despite counsel's recommendation that Allwin move forward with the inspection, Allwin declined to conduct a forensic analysis of the home in 2009.

         In a May 2010 CL-100 termite inspection report, a termite inspector noted evidence of termites, active wood-destroying fungi, and visibly damaged wood members. The termite inspector recommended a "complete and thorough evaluation by a qualified building expert to determine what repair if any is necessary to this property." CIS performed a second home inspection in May 2010, again noting numerous construction deficiencies, including: roof leaks, deterioration of roofing components, signs of prior termite activity, damage to siding, water infiltration at windows, water infiltration and damaged flooring at windows and doors, leaks into the basement, cupped hardwood flooring, water ...


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