Great article from Jay on Chinese Drywall
A great solution is renovation loans like the FHA 203k Loan
Two things have happened in the past few weeks regarding Chinese Drywall. I have been blogging about Chinese Drywall for two years, long before it hit the media or public conversation. But two interesting things have happened recently which deserve comment.
In April 2010, in Louisiana, and what is called a "warning shot," and a "bellwether case," Federal Judge Eldon Fallon in New Orleans ordered Taishan Gypsum Co. Ltd., a Chinese concern, to pay seven Virginia families a total of $2.6 million to remediate defective Chinese-made drywall in their homes. This is the first settled case of many that have hit American courts. There are hundreds of cases already in courts to follow. Currently residents in 37 states, Washington DC, American Samoa and Puerto Rico have filed thousands of complaints and/or have filed suit.
When was this drywall used? Mostly during the wave of new building after the major hurricanes in the Southeastern United States between 2005 and 2007. A majority of the cases are found in Florida, Louisiana, Mississippi and Virginia.
And where was most of it used? According to Engineering News dot com, “ 'Most of the problems are going to be occurring near the ports where they brought in [the defective drywall],' says Ron E. Wright, a building diagnostic expert and chief operating officer of Buric, a claims consultant with an office in Wilmington, N.C. Wright testified as an expert witness in the Taishan case."
Now, maybe it's just me, but do the affected residents and the courts really think that China, or any Chinese government-controlled company, will roll over and pay whatever it takes to remediate this problem? I remain a skeptic! As nice as it would be for the responsible party(ies) to take responsibility for what they have done, I think it's a pipe dream to think they will.
The second recent development are guidelines issued by the Consumer Products Safety Commission. They call it "interim guidance," issued 2 April 2010. In their three-page document, they recommend:
- Removing "all possible problem drywall"
- Replacing all electrical components and wiring
- Replacing all gas-service piping and fire suppression systems and
- Replacing all smoke detectors and carbon monoxide alarms
Interestingly they did not issue guidelines on copper HVAC coils and copper plumbing lines. Anything copper has been affected and is corroding. The CPSC guidelines focus only on immediate life-threatening issues. Copper products are caused to fail by the gas byproducts coming off this drywall and AC systems in particular have been affected and rapidly fail. Perhaps this is why they call this report "interim guidance." Further study or review will likely produce more guidelines. They are still conducting gas emission testing and analysis.
This isn't exactly pure revelation! It's a big DUH... OF COURSE ALL OF THE CHINESE DRYWALL AND ANYTHING AFFECTED BY IT NEEDS TO BE REMOVED!! The question has always been at whose expense.
Since it isn't an insurable problem and the builders are not really at fault, whose problem will it be ultimately? Of course it's the homeowners' problem! This may seem a harsh bottom line, because this problem is huge and very, very expensive to remediate, but really, whose problem is it ultimately? If you are having this problem and want to sell or rent your house, what alternative is there? *
This is a big deal, and getting bigger. This is terribly, terribly unfortunate.
My recommendation: I THINK WE NEED TO RECALL CHINA! AND AVOID CHINESE-MADE GOODS OF ALL STRIPES, SHAPES, COLORS AND SIZES. THIS, HOWEVER, IS VERY, VERY DIFFICULT TO DO. WE ARE INUNDATED.
* If the motor goes bad on your car, would you contact your insurance company? And if you did, what would they say? That it is a manufacturing problem and not covered by your policy. And if the manufacturer would not, or could not, take responsibility, whose problem would it be? If the motor goes bad on your Yugo, who you gonna call?