Building a case
Some Albuquerque homeowners allege Longford Homes cut corners on construction. But Longford says its homes are just fine. Client Juliette Alarcon and her family were among the first to move into the then-new Mountain View Estates development in Southwest Albuquerque in 1998. A bad storm that first year created a sinkhole in front of the home that eventually split the sidewalk and created a channel of water under the house, Alarcon says. Longford told her the problem was caused by a backhoe that cracked a pipe during construction, and it had the hole dried and backfilled, she says. Alarcon says she and her family later that year noticed cracks in the interior and exterior walls. And Alarcon says her bathtub flooded the garage through a leak, and that Longford told her the plumber forgot to seal the tub.

Building a case

New Mexico Business Weekly - July 27, 2007

by Tom O'Connell

NMBW Staff   
   nolanrudi.com
Fissures like these, in Mountain View Estates
(above and left), have triggered a legal rift
between homeowners and the home building
company.

About 150 homeowners in four Albuquerque subdivisions are suing Longford Homes, alleging shoddy construction.

Longford says the accusations are unfounded, the result of ambulance-chasing legal tactics.

"We believe this lawsuit ... is a result of a two-year door-to-door campaign by a California law firm who set up shop in Albuquerque with the goal of soliciting people to sue Longford and other area builders," says Tom Robinson, director of legal affairs for Las Vegas, Nev.-based Longford. "Only 5 percent of our homeowners joined the lawsuit, which means that 95 percent of our homeowners are satisfied with their homes."

John Rhinehart of Robertson & Vick of Calabasas, Calif., represents the homeowners.

Client Juliette Alarcon and her family were among the first to move into the then-new Mountain View Estates development in Southwest Albuquerque in 1998. A bad storm that first year created a sinkhole in front of the home that eventually split the sidewalk and created a channel of water under the house, Alarcon says.

Longford told her the problem was caused by a backhoe that cracked a pipe during construction, and it had the hole dried and backfilled, she says. Alarcon says she and her family later that year noticed cracks in the interior and exterior walls. And Alarcon says her bathtub flooded the garage through a leak, and that Longford told her the plumber forgot to seal the tub.

A recent visit to the homes of Alarcon and her neighbor revealed cracks in walls and ceilings throughout both homes, what appeared to be mold or mildew around a crack in Alarcon's bathroom, cracks up to an inch wide running through the floors of both homes, cracks in exterior stucco walls and fissures running through the sidewalk and street in front of the homes.

Rhinehart peeled back a section of carpet and padding inside the neighboring home of Leroy and Pamela Chambers, revealing a crack that he says runs the length of the house. He stuck the flat of his hand in the widest part of the crack, and it slid inside. At one point there was a small plant growing through the floor, Rhinehart says.

He has hired forensic construction investigators to examine the homes for defects, and is awaiting results.

Rhinehart says he and his clients simply want Longford to fix the homes and pay the homeowners' legal fees.

"Longford said the suit was motivated by money," Alarcon says. "This is an investment for me. We expected this house to last 30 years -- at least as long as the mortgage."

The first lawsuit was filed in December 2005 as a Chapter 40 filing against Longford, alleging construction defects on behalf of 96 homeowners in the Mountain View Estates and Rolling Hills developments -- which contain about 400 homes -- in an attempt to negotiate a settlement with Longford. Chapter 40 refers to Nevada's homeowner construction defect statute, which was included in many of the contracts for homes built by Longford in Albuquerque, according to Rhinehart. Nevada's "choice of law" statute allows homeowners to collect on a settlement from a builder without proving damages. Under New Mexico's choice of law statute, homeowners have to prove damages.

The Nevada statute was mistakenly included in the New Mexico contracts due to a misprint, says Robinson. He says the Nevada statute appeared in New Mexico contracts and vice versa.

Last fall, a judge decreed that the Nevada statute was legally binding.

"In legal theory, you can void a contract if there's a mutual mistake," Rhinehart says. "It was clear that [Longford] made a mistake, but it was not clear the homeowners made a mistake. You're dealing with a pre-printed purchase agreement."

In response to the initial claim, Longford "filed a complaint for declaratory and injunctive relief" against the homeowners, Rhinehart says.

Basically, they were seeking for the court to apply New Mexico law to the cases," he adds.

Rhinehart filed a counter-claim, and the case is now in the discovery phase.

Longford has hired its own engineers to look for structural defects. It has filed complaints against roughly half its subcontractors, Rhinehart says.

The second lawsuit involves 20 to 25 homes in Sunrise Ranch, which has about 350 homes. The third lawsuit was filed on behalf of about 40 homeowners in Paradise Skies, which has about 650 homes. Out of the 2,570 homes built by Longford in New Mexico, those in dispute in Albuquerque represent 6.07 percent of that total, says Longford's Robinson.

Rhinehart says the soil content could be responsible for the fast deterioration of the homes, and he alleges Longford's subcontractors did not properly compact it.

"Longford retained a soil engineer from Albuquerque who did analysis and a recommendation for preparation of soil," Robinson says. "Longford required all subcontractors to comply with this recommendation."

Robinson insists Longford has a reputation for responding to homeowner complaints "sometimes within 15 minutes," and that Longford is doing everything within its power to locate "the responsible party, if there is such a thing."

"A house is probably the last hand-built thing in America," Robinson says. "With all due respect to Mr. Rhinehart, we build fine houses. We've always stood by our product and always will."

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