As Chinese drywall horrors and costs mount, Washington waffles
Wake up and good morning. After so many months of mounting evidence, families effectively banned from their homes for health reasons, homes so tainted that they can't be resold, litigation, federal and state investigations and general outcry... you'd think we'd finally be making some progress on fixing the problems caused by the use by builders of sulfur-spewing, corrosion-inducing Chinese drywall in thousands of homes built in or around 2005-2006 in Florida and other states.
Then comes our startlingly wishy-washy federal product-safety regulators, apparently led by Chief Waffler and Consumer Product Safety Commission chair Inez Tenenbaum (see photo). While saying Thursday that their sampling of Chinese drywall emits higher concentrations of sulfur gases and strontium than U.S.-made product, the regulators found no evidence so far that the emissions were to blame for health problems and metal corrosion reported by at least 1,900 U.S. homeowners. Here's the complete Wall Street Journal/Dow Jones story.
An abundance of scientific caution? Just an unfortunate coincidence? Or perhaps a weak-spined federal accommodation to China? You decide.
There's some serious liability lurking here. Consulting firm Towers Perrin estimates that the tab for drywall damage could range from $15 billion to $25 billion, and housing experts have estimated it costs about $100,000 per average-sized home to pull out bad drywall and replace corroded electrical wiring and appliances. No wonder housing developments in Florida (see AP photo of sign) are going out of their way to advertise "No Chinese Drywall Here."
As the Dow Jones story notes, the Consumer Product Safety Commission's "inconclusive preliminary report promises to continue the uncertainty over who will pay for damage claimed by homeowners in 30 states, the District of Columbia and Puerto Rico—China, the home builders, distributors, insurers or the U.S. government." Federal studies on the health and corrosive effects of the drywall are continuing. The story adds:
"Before CPSC Chairman Inez Tenenbaum visited China earlier this month for a U.S.-China summit on consumer product safety, she said she planned to ask Chinese officials whether they were prepared to help pay for any drywall damages. But the agency has since sidestepped answering whether Ms. Tenenbaum discussed the cost issue with Chinese officials. A CPSC spokesman said only that Ms. Tenenbaum, in private and public meetings with senior Chinese officials, stated her expectation that Chinese companies 'should do what is just and fair' and accept responsibility if any of their products are at fault.
"A spokesman for the Chinese Embassy said he wasn't aware of any agreement between the U.S. and China on payment for any damages."
Sen. Bill Nelson of Florida— the state that has seen the majority of homeowner complaints — told Dow Jones that the CPSC results "defy common sense," and added that he is frustrated by "the slowness of the testing." Nelson (in photo) sent a letter to President Barack Obama Thursday asking him to raise the issue of contaminated drywall when he meets with Chinese President Hu Jintao next month in Asia.
Why do I have a growing suspicion this 5K of fingerpointing is about to become a bureaucratic marathon?
Here's the inside joke. President Obama replaced acting CPSC chairwoman Nancy Nord last spring after Sen. Nelson accused her agency of doing too little, too late to prevent tainted imports of Chinese drywall from causing health problems for homeowners in Florida and other states.
Whew. Glad we got that fixed.
In the meantime, feast on this NPR story headlined Toxic Chinese Drywall Creates A Housing Disaster or this AP story headlined Insurers Dropping Chinese Drywall Policies.
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One of the reasons this is happening is that it has become very hard to hold an American home builder (or other business) truly accountable for wrongdoing. Homeowners find out very quickly that it isn't like the tort reform claims you read about.
Building industry groups lobby at the state and federal level for builder-friendly (aka business friendly) laws and the reduction of consumer protection. Often these industry friendly laws are touted as being good for the country, or good for consumers.
When a home buyer finds themself the owner of a defective house, they are faced with numerous hurdles.
The first is the binding arbitration clause that's ubiquitous in builder contracts and those popular 10 yr home warranty policies. This means the homeowner has no right to sue the builder or warranty co. Arbitration by industry friendly arbitrators, and private records that hide complaints, keep homeowners from recovering full or any damages, and keep future home buyers in the dark about it.
Providing that the homeowner manages to find one of the rare ways out of arbitration, they still face builders' "right to repair laws" in over half the states, that force them to jump thru more hoops.
If they ever get to the point where they CAN sue for damages, most lawyers won't take their case individually, because most cases are not worth enough for the enormous amount of work it is, and the low likelihood of ever collecting a judgment should the homeowner go to trial and win.
Only the big class action firms have found a way to make the risk and work worth the potential of winning, and few cases qualify with the court as a class action.
There is a federal class action suit set to go to trial already in Jan 2010. Though the wait for justice no doubt seems interminable to the homeowners, this is actually quick for a trial and one can only hope that the facts, and cure, are discovered by then, because pushing a case through trial unprepared is a recipe for disaster. It may be to the suppliers, importers, and builders, advantage that it IS going to trial quickly for that reason. State cases have been filed but I don't know how many, if any, qualified for class status yet.
It is no surprise that the government is waffling on this issue. It's been a long time, if ever, since the government's first concern was its citizens. The main concern of our elected officials and the appointed heads of 'consumer protection' type agencies, is how beholden they are to industry special interest lobbying groups that donate a lot to their campaigns, and/or have other ways of influencing them. It seems that in America, "business friendly" has come to mean "fraud friendly."
Posted by: Consumer | October 31, 2009 at 06:24 PM
Chinese drywall manufacturer, Knauf, has agreed to accept “service of lawsuits” for one month, an unprecedented move that removes many of the obstacles claimants have been facing, a huge breakthrough for plaintiffs who have suffered the unpleasant and potentially harmful odors and fumes metal corrosion associated with defective Chinese drywall. Claimants with KPT drywall need to file their suits as soon as possible. This is a good place to get information on filing a suit: Chinesedrywall.org. Knauf Plasterboard (Tianjin) Co., Ltd., is alleged to be a subsidiary of the German-based Knauf Gips KG and is one of several Chinese companies accused of manufacturing and importing defective drywall from China into the U.S.
Posted by: Cyn | November 02, 2009 at 08:40 PM
Revision--Important Filing and Contact Information:
Chinese drywall manufacturer, Knauf, has agreed to accept “service of lawsuits” for one month, an unprecedented move that eliminates many of the obstacles claimants have been facing, and a huge breakthrough for plaintiffs who have suffered the unpleasant and potentially harmful odors and fumes and metal corrosion associated with defective Chinese drywall. Claimants with KPT drywall need to file on to the suit no later than December 2, 2009, with the suit filed by December 9, 2009. Homes must be inspected before the December deadline so that claimants can submit proof that their house was built with Knauf Drywall. This is a good place to get information on filing a suit: http://www.yourlawyer.com/articles/read/17221 and includes a toll-free number for claimants looking to join the lawsuit. Knauf Plasterboard (Tianjin) Co., Ltd., is alleged to be a subsidiary of the German-based Knauf Gips KG and is one of several Chinese companies accused of manufacturing and importing defective drywall from China into the U.S.
Posted by: Cyn | November 04, 2009 at 08:02 AM