Jordan Fogal
Houston, Texas
Jordan bought her dream retirement home in Houston, Texas. Within months of moving, she discovered over $150,000 worth of damages--damages so severe that her doctor forced her to move out immediately, because of the harmful health effects. Jordan pleaded with her builder to fix the damage on the home but instead he forced her in to arbitration because, as with many homebuyers’ contracts, her contract included a binding mandatory arbitration clause. Jordan went through arbitration, spending thousands on experts and witnesses. After successfully proving fraud against her builder she only received $26,000 for her $300,000 home, which is now uninhabitable. Jordan now cannot appeal and has no recourse for action. She is left homeless and stripped of her basic American right to get justice through the courts.
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Dale Beinusa
Dixon, Missouri
Dale Beinusa is a US Army Combat Veteran of 22 years, recently returned from a tour of active duty in Iraq in October 2006. Still on active duty, he was stationed at Fort Leonard Wood, Missouri, when he purchased a newly constructed home in November 2002 in Waynesville, Missouri.
There were multiple problems with the home, including major structural damage and an unstable, un-level kitchen floor. Dale notified the builder about the problems but the builder only a few of the many problems were resolved. Dale was forced to settle the dispute through arbitration, as required by his warranty. Dale paid $500 in arbitration fees and $80 in additional travel expenses for a meeting that only lasted 38 minutes. The arbitration process was severely slanted in favor of the builder. The arbitrator had not read the information on the case and he did not inspect the structure of the house as requested. The final arbitration ruling provided no remedies to his home. Dale did not understand the references in the ruling so he asked for clarification. He was told that the arbitration ruling would stand and that the case was closed with absolutely no explanation. While he tried to fight this unfair ruling, Dale received orders to return to Iraq.
For Dale, it must be difficult to fight for freedom and justice abroad when he cannot get proper justice at home.
Scott and Leslie Kimbell
Jefferson, Georgia
Scott and Leslie Kimbell decided to build their dream home. After extensive searching they found a beautiful lot and a reliable builder to do the job. Toward the end of their first year in the house they noticed a dip in the fireplace and some cracking in the walls above the fireplace. The builder offered to repair the problem, but the “repairs” did not correct the problems which only grew worse. They spent thousands of dollars on structural engineers who confirmed the horribly defective construction of the home, including numerous code violations. When the builder would not return their calls or fix the problems, they filed a lawsuit. That is when they discovered that an arbitration clause in their contract denied them access to the courts. The arbitration process took over two years and cost them $40,000. They were harassed and threatened by the builder throughout, and could not do anything about it. The arbitrator’s bias and incompetence were displayed by his lack of knowledge and disregard for the facts of the case. The Kimbells presented a case with indisputable evidence, including expert testimony and video evidence that proved the builder committed fraud. The arbitrator exceeded the month-long deadline in rendering a decision. Defying logic, his final decision stated that all the defects in the house were the fault of the homeowners, but all fees would be split by both parties. When they requested an explanation of the verdict they waited two more months, when the arbitrator finally told them that he would not state the evidence or law he used to reach his decision. The Kimbells have spent all of their savings on arbitration and were left with a house that no one will buy.
Greg Cole
Marietta, GA
Greg bought his dream home for his two boys and his wife. Greg noticed a few structural problems with the home so he hired an engineer who discovered three pages worth of defects in the house. In particular, there was mold growing throughout the house. His family was diagnosed with dangerously high levels of mycotoxins in their bodies because of the mold. His two boys have mold in their bloodstream and his wife has a fungus eating away her ear canal that her doctor cannot cure. The family’s doctors say they are all slowly dying. Greg tried to go to court with the builder, but was forced into arbitration. When he bought the home, he was instructed to initial a box on arbitration, which was never explained to him. The arbitrator instructed the builder to make some minor repairs but he did not address the largest problems, most importantly the mold. Despite his supposed “victory,” Greg was told to split the arbitration fees with his builder. The house was uninhabitable, so he was forced to tear it down and rebuild. Greg is too sick to work. He has no home and he has mounting arbitration bills and medical bills from his family’s deteriorating health. The arbitration process denied him access to justice that would have held the builder accountable and provided a remedy for the wrongs Greg and his family suffered.
Guy Combs
Alpine, TX
Vietnam veteran Guy Combs bought a house in his hometown of Alpine, Texas. After living in the house for only four years, Guy discovered that his home had severe structural problems. He asked his builder to repair the damage, but the builder offered to pay only $3,000 for $300,000 worth of damages. When Guy bought the home he unknowingly signed an arbitration agreement, which was not explained to him at the time. Therefore, he was forced to settle his dispute in arbitration. Guy describes arbitration as “third world justice.” The arbitrator refused to recognize that there were damages to Guy’s home despite the testimony of twenty expert witnesses that Guy hired. The arbitration process cost him $77,000. The arbitrator billed him a flat fee of $150,000 but after negotiations he brought the fee down to $50,000 plus interest. Guy did not want to lose his ranch and, since there was no means for appeal, he paid the fees. Guy has a PhD from Brown and he thought he understood our legal system, until his rights were eviscerated by arbitration.
Jim Stacy
Horn Lake, Mississippi
Jim moved from Biloxi right after Hurricane Katrina and bought a $350,000 home. The mortar was messy all around his house so he complained and the builder poured acid all over the house and driveway to repair it. When that did not resolve the problem the builder chiseled around the bricks to remove the mortar and ended up cracking the bricks. Jim got an engineer to come out and look at the house who told him he would need to re-brick the entire house at a cost of approximately $39,000. Since he owned the home for less than a year, he asked the builder to make the repairs under the advertised one-year warranty. Jim’s home also suffered water damage, so the total bill for damages was $45,000. After the builder refused to repair the damage Jim got a lawyer. This is when he discovered he would be forced into arbitration. The arbitrator would not allow expert testimony. He visited the home but appeared aloof and did not take any notes. The arbitrator ruled in favor of the builder except for a few minor repairs. Jim says the experience has been the worst of his life.
Linda Etherson
Knoxville, TN
When Linda Etherson bought her home, she was informed that she would receive a one year builder’s warranty. After being told by the builder that he would take care of everything, Linda signed a form which she was told was an acknowledgment of her warranty. It in fact contained a clause that said any disputes would be handled through arbitration. Within a month, there was extensive damage cause by water leaking through the foundation. Only when she filed suit did Linda find out that she was headed to arbitration. When an inspection was conducted, the report said that even though there was water damage, the warranty did not cover mold. The arbitrator sided against Linda. When she appealed, the new arbitrator ruled that since they could not show actual water leaking through the wall during the two day period of the appeal, her claim was denied. Unfortunately for Linda, it had not rained during either of those days.
Rose Harrison
Washington, GA
When Rose Harrison bought her home, she signed what she thought was a homeowner’s warranty agreement. Unbeknownst to her, it contained a provision that any disputes would be handled through arbitration. She was informed that the home was a model home and had never been lived in. The advertisement said the home had a working sewage and septic system; however, after inspection, this was determined to be false. The builder assured her that this was because it was a model home and she should not worry because one would be installed shortly. When installed, the faulty system caused Rose and her son to become sick. When the health inspector conducted tests of the water, it contained e-coli and coliform. They were advised to use bottled water and not consume any from the house. When she sued, Rose was sent to arbitration. While the arbitrator in the case did order the builder to conduct some repairs, he ruled that the water contamination was not the builder’s responsibility, so Rose had no recourse. She has spent around $10,000 in arbitration and her home is uninhabitable. She has no potable water and the conditions have been so deplorable that her son decided to live with his father.
Mary Finn
Cincinnati, Ohio
Eight-two-year-old Mary Finn had a home built for her by Ray Murphy Homes but due to numerous structural problems (the home did not meet building standards) she did not purchase the home. She tried to get her down payment back, but was told she was bound by an arbitration clause. Using the “fast track” system, she went through arbitration with the American Arbitration Association. The builder and attorneys kept cancelling, so it was not a fast process, as advertised. During arbitration Mary encountered misrepresentation and fraud. The builders hid the damage on the house by limiting inspections and Mary paid high costs and was misled about the costs of arbitration. The builder's lawyer took money out of their retainer to pay for the builder's filing fee without their knowledge or approval. She still can not get the builder into arbitration because he refuses to make himself available. She refers to arbitration as “rape” because she has felt so violated through the process.
Steven Vinson
Lexington, KY
After bravely serving his country in Vietnam, Steven Vinson never thought he would have to face a new enemy at home. Using a Veteran Affairs loan, he purchased a house. While he noted numerous code violations before he signed the contract, he was assured that all repairs would be completed within ten days. That was then pushed back to thirty days after the contract was signed. After no repairs were ever completed, he contacted the Home Builders Association, which sent out a team of inspectors. They found numerous violations and when they ordered the builder to repair them, he refused. Mr. Vinson contacted numerous people in Washington, including the VA, the Vice-President, and the President. Eventually after five years, he sold the house. When he tried to hold the builder accountable, he was referred to arbitration. Since it was going to cost thousands of dollars and there was no guarantee the arbitrator would even follow the law in this quasi-legal process, Steven declined.
Ned Bond
Frederick, Maryland
Ned and Lori Bond got an addition to their house in Frederick, Maryland. They signed an arbitration clause, which they were told would put them in arbitration to settle disputes more cheaply, quickly and informally than going to court. The addition project fell through and the builder would not return their deposit. When they tried to hold their builder accountable, they were forced into arbitration. The fees were astronomical. The rules and regulations of their procedure continuously changed. After a year of letters and many attempts at mediation and arbitration with nothing to show for it they finally got into a courtroom.
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