General Release of Contractor Upheld Despite Knowledge of Construction Defects

Judges behind bench illustration

The decision was grounded primarily on how the purchase agreement was drafted.

February 27, 2019
Garret Murai - California Construction Law Blog

Ah, the elusive Lepus Cornutus, commonly known as the Jackalope. Rarely seen, we may have one in SI 59 LLC v. Variel Warner Ventures, LLC, Court of Appeals for the Second District, Case No. B285086 (November 15, 2018), an interesting case involving a developer, a contractor, a general release, and Civil Code section 1688.

SI 59 LLC v. Variel Warner Ventures, LLC

In 2005, Variel Warner Ventures, LLC (Variel Warner) entered into a construction contract with Verdugo Management & Investment, Inc. (Verdugo) to construct improvements at an 85 unit apartment complex. Under the terms of the contract, Verdugo agreed to construction the improvements in a good and workmanlike manner in strict compliance with all drawings and specifications and to comply with all laws. It didn’t. The work was defectively flashed, counterflashed, and waterproofed.

Mr. Murai may be contacted at gmurai@wendel.com



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