Folsom Condo Owners Awarded Mold Settlement

June 16, 2010

By Lonnie Wong FOX40 News

June 15, 2010

Sacramento

FOLSOM, CA. - 24 people who purchased converted apartment condos have been

awarded a $5 million settlement by an arbitrator who ruled that the condo

developer concealed dangerous growths of mold in the units. Prometheus Real

Estate based in Santa began converting about 400 units in the Waterford

Place Apartments in 2005 at the height of the condo conversion craze. It sold 41

units from $150 to $250 thousand dollars.

But soon after those who bought the condos discovered that many of the units

were infested with mold that were deliberately covered by paint, baseboards and

new siding. Many owners reported respiratory illnesses. Violent Vernon's teen

aged children were among them. " Two of the three kids were diagnosed with asthma

a few weeks after we moved in, " said Vernon.

The condos are no worth about $60 thousand dollars. Owners were stuck with

condos they couldn't sell or rent. Vernon did not get any medical compensation

in the arbitrators ruling but is glad her four year old fight is over. " This was

about a sale that never should have occurred, " she said.

Folsom attorney C. , Jr. represented the two dozen condo owners. He

said the mold was caused by moisture from leaking windows and faulty plumbing.

" Instead of repairing the problems they merely covered it up with $9 million in

renovations, " said .

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also said Folsom city inspectors noted moisture leaks and mold problems

in reports that were supposed to be posted in the condo sales office and placed

on file. But he said the company did neither. The arbitrator cited " fraud and

concealment " on the part of Prometheus.

The ruling calls for the company to pay purchase expenses like property taxes,

closing costs, and mortgage payments. But condo owners must return their condos

and pay for rent to the company for the time that they stayed in the units. In

many cases that totaled $20 to $30 thousand dollars. Condo owners say they did

not come out ahead because there were no punitive payments assessed in the

settlement.

says mold is still a common complaint in apartments and condos. Most

settlements are confidential, but the arbitration ruling is public. His law firm

handles mold cases exclusively. " We get a minimum of 40 calls a week for new

cases, " said .

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