Fox Team Wins Appeal for Homeowners in Construction Defect Case

October 3, 2017 – Press Releases

In a court battle over shoddy workmanship in the construction of a home, a Fox Rothschild litigation team led by J. Benjamin Nevius successfully defended its victory at trial in a hard-fought, lengthy case, and won an award of additional attorneys’ fees that is almost certain to substantially increase the clients’ recovery.

The Pennsylvania Superior Court’s 84-page precedential opinion in Krishnan v. Cutler Group Inc. is legally significant for several reasons.

The decision:

  • Clarifies the standard of proof required in claims under the Pennsylvania Unfair Trade Practice and Consumer Protection Law (UTPCPL).
  • Reaffirms that a plaintiff need not be driven from his or her home to demonstrate a violation of the implied warranty of habitability.
  • Requires that any disclaimer of implied warranty rights must be explicitly stated.
  • Upholds the power of a trial judge to award costs for expert witnesses in the context of a UTPCPL claim.
  • Reaffirms that an award of attorneys’ fees should be calculated using a simple formula of reasonable rate times reasonable hours.

In the suit, Fox’s clients asserted claims under the UTPCPL, as well as contract and warranty claims. They alleged that a home built by the Cutler Group in a development known as Malvern Hunt was improperly constructed and suffered from chronic water infiltration and damage.

Nevius argued at trial that the builder attempted to hide the home's significant water problems and avoid its promises and obligation to repair the home.

A jury found in favor of the homeowners on the contract and warranty claims. Since there is no right to a jury trial under the UTPCPL, the trial judge held a second nonjury trial on that claim. Ultimately, the court found in favor of plaintiffs' on their UTPCPL claims and awarded a total of $317,668 in damages, costs, and attorney fees, plus prejudgment interest.

Now the Pennsylvania Superior Court has upheld the verdict and ordered that additional attorneys’ fees be awarded to plaintiffs.

The three-judge panel rejected all of the Cutler Group’s arguments about how the trial judge handled the evidence and the testimony from expert witnesses.

The panel also ruled in favor of Fox’s clients on their cross-appeal for a larger attorney fee award. The panel noted that the trial judge specifically found that Fox’s “hourly rates were reasonable,” and that the hours worked were proportional. As the trial court recognized and the plaintiffs experienced, “nothing during the life of the litigation was simple” because of the Cutler Group’s uncooperative litigation strategy. As a result, the appellate panel found it was wrong for the trial judge to impose an artificial limit on the attorneys’ fees. It ordered the lower court to recalculate the fees, including the work in defending the appeal.

Fox attorney Melissa E. Scott assisted in the appellate phase of the litigation.