WestCon Tribune

On December 4, 2000, the California Supreme Court ruled San Diego case of AAS v. Superior Court. The Court ruled in a 5 - 2 decision that plaintiffs could not seek recovery under any tort theory for negligent construction that had yet to cause actual damage.

The case raised two separate issues. The first is whether the plaintiffs could recover for items of damage that had yet to cause harm under strict liability or negligence. The trial court had ruled in a pre trial order that, unless actual damages could be shown, the well established economic loss doctrine barred recovery. Quoting the recent case of Erlich v. Menezes, wherein the court refused to allow the imposition of emotional distress damages in a construction defect case, the Court ruled in the AAS decision that: "A person may not ordinarily recover in tort for the breach of duties that merely restate contractual obligations." The Court also used the established case of J’Aire Corp v. Gregory, to conclude: "We do not believe, however that the J’Aire court intended to dispense with the rule that appreciable, non speculative, present injury is an essential element of a tort cause of action".

The Court ended its majority decision by stating: "Home buyers in California already enjoy protection under contract and warranty law for enforcement of builders’ and sellers’ obligations; under the law of negligence and strict liability for acts and omissions that cause property damage of personal injury’ under the low of fraud for misrepresentations about the property’s condition’ and an exceptionally long 10-year statute of limitations for latent construction defects. While the legislature may add whatever additional protections it deems appropriate, the facts of this case do not present a sufficiently compelling reason to preempt the legislative process with a judicially created rule of tort liability."

The Supreme Court’s ruling in the AAS v. Superior Court decision now makes it harder for plaintiff’s to sue for construction defects that have not caused harm or actual damages.

For our February meeting, attorney and Westcon member Gene Bass will moderate a discussion on the AAS case. This case has far reaching impact on all of us. Mr. Bass will give us his over view and open up a discussion and invite participation from the audience. There surely will be a diverse reaction that will excite us all and give us greater understanding and knowledge.