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Arbitration Panel Finds In Favor Of DHP Silver Creek Investors And Pacific Diversified Company In Comples Construction Case

May 1, 2002

San Jose, Calif. – May XX, 2002 – A contract dispute initiated by a residential homebuyer in the high-end subdivision of the Silver Creek area of San Jose, known as Silver Creek Vintage Estates, against the contractor and individual investors is now final. Attorney Kevin P. Cody, a partner at the San Jose-based Ropers Majeski Kohn & Bentley (RMKB), a multi-service law firm offering litigation and transactional services to domestic and international businesses, successfully represented DHP Silver Creek Investors and Pacific Diversified Company, Inc. before an arbitration panel in the residential home dispute, Fanelli v. DHP Silver Creek Investors, and Pacific Diversified Company, Inc. After an eight-day binding arbitration, DHP and Pacific Diversified Company, Inc. recovered all amounts claimed, including attorney’s fees and litigation expenses, totaling more than $800,000.

Background

San Jose’s DHP Silver Creek Investors and Pacific Diversified Company, Inc., specialists in residential and commercial construction projects, contracted with the buyer to construct a custom home. During the course of construction, the buyer was extremely critical and demanding, attempted to micro-manage the project, while making incessant changes.

In October 2000, when construction on the home was essentially complete, the buyer refused to pay anything further on an outstanding amount of almost $600,000. Though DHP made multiple overtures to the buyer to discuss and resolve differences, the buyer refused to negotiate amicably, at which point DHP became convinced that the buyer intended to obtain the beautiful new custom home at a “substantial discount.” Subsequently, the buyer filed for binding arbitration accusing DHP and Pacific Diversified Company, Inc. of breach of contract, intentional interference with contract, and intentional infliction of emotional distress, and requested, among other damages, punitive damages. DHP counter-claimed for all outstanding amount owed.

“The evidence overwhelmingly demonstrated that the quality of construction was exceptional and that the substantial delays in the construction were due to constant changes by the plaintiffs. We estimated that they requested close to 100 changes to the home during construction,” said Cody.

DHP and Pacific Diversified Company, Inc. have built 15 new homes in the subdivision of Silver Creek Vintage Estates. Fourteen of those new homes were built and sold without incident to the satisfaction of the buyers. According to David Pitzen, managing member of DHP and president of Pacific Diversified Company, Inc., “The actions of the Fanelli’s in this situation were blatantly deceptive and we are thrilled by the outcome of the case. We applaud Kevin for his extensive knowledge of the industry and his outstanding legal work.”

Cody handles a variety of cases ranging from complex construction defect lawsuits to products liability actions, including class actions. He has tried cases throughout the state of California both in federal and state courts. He earned his J.D. in 1980 from Santa Clara University.

Based in San Jose, Calif., Ropers Majeski Kohn & Bentley conducts a multi-service practice offering litigation and transactional services to domestic and international businesses and individuals. The firm's practice areas include corporate and commercial, employment, environmental, professional liability, intellectual property, coverage, bad faith and regulatory matters, fidelity and surety,
product liability, appellate, tax and estate planning. The firm also has offices in Redwood City, San Francisco, and Los Angeles, California, and New York. Visit the firm on the Internet at www.ropers.com.
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