From our upcoming book: Housebroken:
The myth of quality construction©

ALL IT'S CRACKED UP TO BE
One couple did the right thing when they felt the earth move: They called their lawyer early in the process.

NOAH'S LONG-TERM LEGACY
More and more water is intruding into homes as homes intrude on the wilderness. A review of your insurance policy sooner than later is your first line of defense.

	BREAKING NEWS - Court rules in favor of La Jolla homeowners to prevent a landslide in a suit against the City of San Diego involving a hazardous storm drain.

One couple did the right thing when they felt the earth move: They called their lawyer early in the process.

When Lisette Heins entered the master bedroom of the modest suburban Sacramento, California home she shared with her husband, Rick, that summer day of 1993, she noticed something odd and disconcerting: She was walking slightly downhill.

"I felt it, but I couldn't really see it," recalled Lisette many years later.

At first, the couple tried to convince themselves that they were simply imagining it.

But within a very few weeks other ominous signs of problems began to materialize. A hairline crack that had appeared in the ceiling of the master bedroom suddenly broadened and lengthened. Rick began to notice cracks and movement in wallboard joints in the garage. Lisette almost stumbled over a buckled section of bathroom linoleum.

And then the Heins made the disturbing discovery of a severely cracked concrete foundation. A major rift along the length of their driveway quickly followed.

Something was seriously wrong with the house they had occupied for more than nine comfortable years.

The Heins soon would know the magnitude of their problem. Their house, in fact, was literally cracking in half.

Yet their biggest trial was still ahead. A mere nightmare was about to become a living hell.

The Heins immediately tried to locate the construction company, Citation Builders. The company had either moved or gone out of business; no one could be found at the address listed on the Heins' paperwork. Rick made repeated efforts to locate the company, to no avail. (Unbeknownst to him at the time, the company had changed its name to Citation Homes.)

In the meantime, Rick hired a carpenter to correct a growing problem of sticking interior doors. The carpenter happened to be a general contractor, and he told Rick there were far bigger problems with the house than a bunch of sticking interior doors.

"That was really the first time I became aware that it was something more than just a regular problem," Rick would relate to an insurance investigator several years after that incident. "I figured, okay, the house had settled." But the contractors' words were worrisome.

The Heins had purchased the house in September 1983.

"It was our first house and we were so proud," said Lisette. "There are a lot of great memories from that place."

That was then. Now, it was nearly a decade later. The clock was ticking steadily toward the 10-year limitation placed on builder liability by California law.

Rick contacted a local architect, Seiss Wagner, and retained him to inspect the house. Wagner's subsequent report would describe the subdivision residence as a three-bedroom, two-bath, 1,200-square-foot house located on pleasantly-named Deerfield Court. It was new when purchased by the Heins for $87,500. The slab foundation structure is bounded by a creek and Western Pacific Railroad tracks.

Wagner wrote in his report to the Heins:

"From the street, large cracks and splits in the form of crazing can be seen in the ground surface of the front yard. Some of these soil separations go on under the driveway slab causing the driveway to crack and uplift. On the west side of the house along the garage, an eight-foot-high, precast concrete wall can be seen leaning at its top six inches to the west.

"The surface of the grade between the garage and the wall shows a differential settlement and cracking of the concrete slab.

"The property on the west side of the wall, which follows the railway easement, appears to have been dredged gradually six feet or lower than the surface of the building lot.

"Inside the house, the floor slab of the garage and ceiling of the master bedroom are both severely cracked and appear to be puling away to the west, and dropping down from the rest of the structure."

The architect quickly spotted the source of the problems, too. He noted the structural problems "are clearly the result of soil subsidence into the dredged channel along the railway easement."

Responsibility for the condition, he added, could be laid at the doorstep of faulty soil engineering and grading, or the dredging of the railway easement sometime after the property was developed.

So -- according to the architect -- either the builder or the railroad was engineeringly or physically responsible for the damage being wrought on the Heins' home.

Now the Heins' knew, more or less, what problems existed with their house. As to a solution, they were no closer than they had been when the bedroom slope had first been discovered.

Their architect then gave them the next layer of bad news. Structural repair of the residence, he wrote, "will be both difficult and expensive."

Preliminary recommendations for repair included razing most of the house and its cracking slab and constructing a brand new grade beam foundation, replete with concrete-and-steel piers extending down to stable soil conditions. No cost estimates were forthcoming pending completion of a recommended soil condition analysis.

One day in July, 1993, Rick, a plumber, had a job in the nearby town of Folsom. En route, he suddenly spotted a truck at a construction site which bore a door sign reading "Citation Homes." He stopped and asked for the telephone number and address of the construction company.

The company had moved to the San Francisco Bay Area, Heins discovered. That was why he had been unsuccessful in finding them, during what would prove to be a very critical five month period.

When he was able to finally contact the company's representative, Heins now recalls, the first words out of the rep's mouth was a question: "Has it been more than ten years since the house was purchased?

Heins had to admit that ten years had passed.

"But I had been trying to find them, and to contact them" said Heins.

Frustrated and beginning to feel the raw edges of panic, the Heins finally contacted a Sacramento attorney in early 1994.

Their attorney suggested the possibility that eventual liability might be assessed to Western Pacific Railroad due to its activities in the area. If this was the situation, their lawyer explained, it might comprise "an ongoing trespass and/or nuisance for which you don't necessarily have a statute of limitations."

A few letters back and forth with the railroad company convinced the lawyer and his clients that pursuit would prove very costly. Railroad lawyers have many decades of experience in handling these kinds of claims, and rarely does a railroad company endure liability for coincidental damage to residences. Eventually, Western Pacific formally "declined" to accept any responsibility for Heins' problems.

Not feeling a great deal of confidence, the Heims turned their attention back to Citation Homes.

In May 1994, the Heins' lawyer notified the couple's homeowners insurance carriers that a claim would be made to recover costs of repair -- as soon as those costs could be determined.

In August, he sent a registered letter to Citation Homes.

"The Heins' residence is now literally cracking in half. There is every indication the home is cracking because of improper compaction. They have been told by representatives of Citation Homes that they may make no claim with the company. While I am well aware that we are beyond the "ten-year" limitation period prescribed by our legislature, I feel compelled to present a claim to Citation on behalf of the Heins."

Their lawyer concluded: "This is legitimately a tragedy in the making."

Citation -- surprise, surprise -- failed to respond to his letter.

Heins then hired a geotechnical company, Wallace-Kuhl and Associates, to conduct a "distress evaluation." The subsequent report verified all of the structural problems that the Heins and architect Wagner had noted, and added significantly to the list.

The Wallace-Kuhl investigators saw the source of the problem almost immediately upon their arrival on the site.

"The exterior flatwork in the back yard exhibits both lateral and vertical movement. The surface soils on the lot were visually classified as dark grey silty and sandy clays," according to Wallace-Kuhl's report, the authors of which then observed: "We anticipate these soils are potentially expansive."

By auguring into the soil and taking samples, the engineers were able to pinpoint even more closely the source of the problem. Too much moisture and a considerable amount of organic matter was discovered in the nine-foot-deep landfill under the Heims' house, one created to cover a deep drainage ditch that had once paralleled the railroad tracks.

Not only were improper materials and too-high moisture levels allowed in the fill, but it was incorrectly compacted -- if it was compacted at all, the engineers suggested.

Heaving of the expansive soils resulted in the movement and subsequent cracking of concrete substructures and other features of the Heims house. The report noted that the slab foundation had "moved laterally about two inches."

Wallace-Kuhl's conclusion was that the improper backfill and compacting caused the Heins house to be "damaged by both horizontal and vertical movement of the supporting clay fill soils."

The solution proposed by the engineer was the virtual reconstruction of the entire lot, from the bottom of the former drain channel up, with appropriate concrete and steel pilings. Needless to say, said the engineers, the fix would be very costly "relative to the value of the structure."

Indeed, when a subsequent estimate was prepared by a restoration specialist, the estimated cost exceeded by 140 percent the total value of the property.

The Heins' lawyer's advice to the couple to make a claim against the carrier of their homeowners' insurance eventually turned out to be a big mistake.

The insurance company assigned a special investigator to look into the claim. Her probe echoed what Heins' architect and engineer had deduced: that the drainage ditch had been improperly compacted by the developer, and that is what had caused the overall problem.

However, an exclusion clause in the Heins' policy seemed to free the insurance company of any policy liability: "Faulty, inadequate or defective development...grading, compaction is not covered."

Also, the insurance company investigator alleged that Rick Heins and his wife had been watching the problem develop for at least three years, and their policy required that a claim be submitted "within one year" of the problem's manifestation.

" Mr. Heins acknowledged this...and accordingly we do not believe this claim was presented in a timely fashion."

With that, the company declined payment.

As if that weren't enough, the insurance company, in a letter following the claim denial, informed the Heins that their entire household liability insurance package was going to be cancelled "due to the rapidly declining condition of the property."
The company eventually agreed to keep the policy in force for an additional year, but the die was cast. The Heins were unable to find any other insurance carrier to issue a policy.

Their lawyer observed in a later letter to a bank seeking a loan for the Heins' reconstruction of the house: "In the end analysis, the Heins have absolutely no one to look to for repair of this house. They soon will not be able to acquire insurance for the residence. The residence may not be sold in its present condition. Technically it is uninhabitable. Soon, they will have to simply abandon the property."

The words were prophetic.

The bank loan was declined. The insurance was cancelled. The Heins forfeited ownership of the house on Deer Tree Court and walked away, forced by fate to begin their lives anew.

"I was going to stay and try to gut it out," said Rick. "But my wife didn't want to, and I can't blame her. It was like the rug got pulled out completely, and we had nothing left to fight with."

Today, the Heins rent a residence and try to patch their credit in the aftermath of a cruel twist of fate that altered the direction of their lives forever.