Hicks v. Kaufman & Bd. Home Corp.

• Decision Date: 06 June 2001
• Citation: 107 Cal.Rptr.2d 761,89 Cal.App.4th 908
• Court: California Court of Appeals Court of Appeals
• Parties: (Cal.App. 2 Dist. 2001) ROBIN HICKS et al., Plaintiffs and Appellants, v. KAUFMAN AND BROAD HOME CORP. et al., Defendants and Respondents. B139140 SECOND APPELLATE DISTRICT DIVISION SEVEN Filed

107 Cal.Rptr.2d 761 (Cal.App. 2 Dist. 2001)

ROBIN HICKS et al., Plaintiffs and Appellants, v. KAUFMAN AND BROAD HOME CORP. et al., Defendants and Respondents.

B139140

IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

SECOND APPELLATE DISTRICT

DIVISION SEVEN

Filed 6/6/01

Amended 7/3/01

(Super. Ct. No. BC198414)

APPEAL from an order of the Superior Court of Los Angeles County. Bruce E. Mitchell, Commissioner. Affirmed in part, reversed in part with directions.

Cohelan & Khoury, Timothy D. Cohelan, Isam C. Khoury, Michael D. Singer; Freeman & Freeman and Lawrence P. Freeman for Plaintiffs and Appellants.

Morrison & Foerster, Douglas M. Rawlings and Mark R. McDonald for Defendant and Respondent Kaufman and Broad Home Corporation.

Heller Ehrman White & McAuliffe, Richard DeNatale, Michael T. Williams, Jilana L. Miller; Murchison & Cumming, Friedrich W. Seitz and Edmund G. Farrell, III, for Cross-Defendant and Respondent Synthetic Industries, Inc.

CERTIFIED FOR PUBLICATION

JOHNSON, Acting P.J.

Plaintiff homeowners appeal the denial of their motion for class certification in this action against a developer and general contractor for the cost of repairing or replacing defective concrete foundations under their homes. We hold a class action may be maintained as to the claims for breach of express and implied warranty. Therefore, we reverse the trial court's order in part and remand the cause with directions.

FACTS AND PROCEEDINGS BELOW

Plaintiffs Hicks and Gonzales purchased and continue to own homes built and sold by defendant Kaufman and Broad Home Corporation and its subsidiaries (hereafter Kaufman). Plaintiffs allege the concrete slab foundations under their homes are "inherently defective" because Kaufman constructed them using Fibermesh, a polypropylene product, instead of welded wire mesh.

The parties agree Fibermesh does not cause concrete slab foundations to crack. Cracking is caused by loss of moisture as the concrete dries and by other occurrences such as soil erosion and seismic activity. It is also undisputed neither welded wire mesh nor Fibermesh will prevent cracks from occurring in a concrete slab foundation. Plaintiffs allege, however, welded wire mesh will restrict those cracks to a hairline width and thus maintain the integrity of the slab. Slabs built with Fibermesh, on the other hand, exhibit predominantly wider cracks which split the foundation into pieces and permit moisture, dirt and insects to intrude into the house, cause bumps in the flooring, and do not resist horizontal and vertical ground movement as well as slabs built with welded wire mesh. Plaintiff Hicks alleges, for example, her daughter's bedroom has become uninhabitable due to the dirt and insects entering through cracks in the foundation.

In their complaint, plaintiffs allege causes of action for strict liability, negligence and breach of express and implied warranty on behalf of themselves and all others similarly situated. The class is defined in relevant part as: "All persons or entities who own one or more homes [in specified Kaufman developments] which were constructed and marketed by [Kaufman] in which 'Fibermesh,' a polypropylene product, was utilized in the concrete foundation slabs as a substitute for 6x6, 10x10 welded wire mesh with manifested damage or defect due to the Fibermesh substitution." The complaint seeks "compensatory damages associated with the repair and/or replacement of the concrete foundations" of plaintiffs' and class members' homes. It does not seek compensation for plaintiffs or the class for personal injury or property damage caused by the use of Fibermesh in the foundations.¹

After Kaufman answered the complaint, plaintiffs moved for an order certifying the case as a class action.

The trial court denied class certification and dismissed the class allegations on two grounds: the members of the putative class were not reasonably ascertainable and the causes of action lacked common issues of fact. Plaintiffs filed a timely appeal.

We concur in the trial court's ruling with respect to the tort causes of action because the elements of liability and causation cannot be established without individualized proof as to each of the purported 10,000 class members. We conclude, however, a manageable class action may be maintained as to the causes of action for breach of express and implied warranty because the class is ascertainable and common questions of law and fact predominate with only the amount of damages subject to individualized proof.

DISCUSSION

I.

THE CLASS IS ASCERTAINABLE WITH RESPECT TO EACH CAUSE OF ACTION.

Our Supreme Court has held two requirements must be met to sustain a class action. "The first is existence of an ascertainable class, and the second is a well-defined community of interest in the questions of law and fact involved."² Although courts sometimes treat these two requirements as if they were one,³ they are better examined separately because they serve separate purposes.

Ascertainability is required in order to give notice to putative class members as to whom the judgment in the action will be res judicata.⁴ Common questions of law and fact are required in order to assure the interests of the litigants and the court are furthered by permitting the suit to proceed as a class action "rather than in a multiplicity of separate suits."⁵

In the present case, the trial court concluded "class membership under any of plaintiffs' causes of action [cannot] be ascertained without an individualized analysis of each putative class member's concrete slabs [because] manifest damage to a slab must exist as a precondition for class membership."

The trial court applied an improper criterion in determining ascertainability of the class. Manifest damage to a slab is not a "precondition" for class membership. It is, if anything, an element in the proof of Kaufman's liability and relates to the existence of common questions of law and fact, not ascertainability of the class. ⁶ The court's reasoning is circular because it makes ascertainability depend on the outcome of the litigation on the merits.⁷ Our Supreme Court has held, however, courts may not consider the merits of the claim at the certification stage.⁸

Block v. Major League Baseball illustrates the difference between ascertainability and commonality for purposes of class certification.⁹ Block and four other former major league players brought a class action suit alleging defendants had violated their statutory and common law right of publicity by using their names, voices, signatures and photographs in various commercial products without consent or compensation. The class was defined as "'all major league baseball players who played major league baseball before 1947, or, if they are now deceased, their heirs or beneficiaries.'"¹⁰ The appellate court held the complaint defined "an ascertainable class, i.e., approximately 800 men (or their heirs and beneficiaries) who played major league baseball prior to 1947"¹¹ but affirmed denial of class certification "given the numerous complex issues the trial court would be required to evaluate for each member of the class if the action were certified[.]"¹² The court found the class ascertainable even though it was not defined as former major league players whose voices, likenesses, etc. defendants used without their "consent or compensation." Rather, the court properly treated the lack of consent or compensation as an ultimate fact each class member would have to prove to establish liability.

As explained in the leading treatise on class actions, ascertainability can be better achieved by defining the class in terms of objective characteristics and common transactional facts making the ultimate identification of class members possible when that identification becomes necessary. The class certification order and notice to the class are the proper places to explain the relationship between the defined class and the legal claims being made in the case.¹³

In the present case the complaint defined the class as homeowners whose homes contained Fibermesh foundations "with manifested damage or defect due to the Fibermesh substitution . . . ." This definition is flawed for the reasons stated above, but the flaw is not fatal. A class is still ascertainable even if the definition pleads ultimate facts or conclusions of law. For example, in Wilner v. Sunset Life Ins. Co.¹⁴ the class was defined as persons who owned policies issued by defendant "'which were purchased as a result of deceptive or fraudulent sales practices described herein . . . and were thereby harmed.'" The court held this definition "describes the class sufficiently to make it ascertainable."¹⁵ In Slaven v. BP America, Inc.,¹⁶ an oil spill case, the court certified a class defined as persons having an interest in real or personal property "who have suffered or will suffer economic damage as a result of the oil spill and/or the ensuing clean-up effort.¹⁷ Furthermore, if necessary to preserve the case as a class action, the court itself can and should redefine the class where the evidence before it shows such a redefined class would be ascertainable.¹⁸

The class in the case before us is ascertainable. It consists of the owners of homes in specified developments constructed and marketed by Kaufman in which Fibermesh was utilized in the concrete foundation slabs. As such, the class is precise, objective, and can be determined from public records and Kaufman's own records, at least with respect to the California Marquis development.¹⁹

We conclude, therefore, an ascertainable class exists with respect to all of the causes of action in the complaint.

II.

COMMON QUESTIONS OF LAW AND FACT PREDOMINATE WITH RESPECT TO THE CAUSES OF ACTION FOR BREACH OF WARRANTY.

A class may be certified when common questions of law and fact predominate over individualized questions.²⁰ As a general rule if the defendant's liability can be determined...