And They Built A Crooked House, by Ruth S. Martin


The House is For Sale

For some time we had contemplated selling the house before any legal resolution. A sale would eliminate our suit for recision, but would also define the damages and allow us to move out sooner rather than later. We could still pursue the case and at the same time be free of our structurally-defective house. When it became clear that Murdock's insurance company wasn't going to settle and that the defense attorneys were going to drag out the case, we became serious about selling. At first we planned to sell `by owner' but Baxter vetoed that as a bad idea. He was afraid we would say something that might provoke a libel suit, like the fol-lowing imaginary conversation:

Prospective Buyer (after seeing all the defects): "Who did you say built this house?"

Us: "Frank Murdock. He screwed up next door, too. He doesn't use a level when he builds houses. In our opinion the man's an incompetent builder."

Since Murdock hadn't been `proven' incompetent, we couldn't say anything inflammatory. The `buyer' could be his brother-in-law. Baxter approved selling the house if: 1) it was handled through a real estate agent, 2) there was full disclosure of the experts' reports, and 3) no selling price was stipulated. Why the third provision? If we asked, say, $251,000 (the ap-praised value with defects), the defense could use that figure as a limit of their damages. Baxter wanted the house offered `as is', and let the potential buyer make an offer. Finding a real estate agent was not easy. The first two we contacted wouldn't take the house without a definite asking price. We finally ended up with Bill Arrington, a broker for one of the largest real estate firms in Cleveland. There was one potential hitch to using Arrington. His office also represented Frank Murdock! Bill's office manager, surprisingly, saw no potential conflict of interest and agreed to let Bill take our house. The sales contract was reviewed by a lawyer in Tom's firm, Brad Michaels, who wanted to make sure we were protected.

The contract called for Arrington to market the house with no asking price and no guarantees (`as is'). Realistically, this meant the house would only be shown to builders and contractors, people who could appraise, fix and re-sell a damaged home. The contract also stipulated that a potential buyer could in no way be connected with Murdock, Nelson, or Cooper, either professionally or personally. We didn't want a crony trying to buy at an inflated price, falsely establishing a market value the house didn't have. Several builders were interested, and we received two written offers in November 1987. One builder offered us $200,000, with the stipulation that we move out of the house by March 1, 1988. He wanted the house ready for the spring market. Another builder named Ray offered $202,000 but left the move- out date up to us. As far as we know, neither builder was aware of the other's bid.

We were at the house when Ray came through for a second visit (before his written offer). He seemed both friendly and know-ledgeable.
"The house needs a lot of work," he said. "I can maybe get it fixed for fifty to seventy-five thousand, and then sell it for a profit. It's risky, but you've got a great location and lot."
Ray demonstrated the slope in the kitchen floor in a way no one else had, with a taut string stretched across the floor. He laughed when we told him our architect had called the slope an optical illusion. Ray saw all the problems we had long recognized. It was not a case of knocking the house to get a lower price. Unlike Murdock, he knew how to build a house.
"Ray, if we end up with a cash settlement, would you be willing to fix the house for us?"
He thought for a moment.
"No. No matter what I did, I don't think you two would ever be happy with this house." We didn't argue his point.
Both offers were turned over to Brad Michaels. After real estate commissions neither offer would cover our mortgage, so we could not move. There would be no equity left to buy another home. Michaels thought we should still respond with a counter offer. After consulting with Baxter, Michaels came up with a figure of $300,000. If either builder accepted we could move out, and Tom would drop the demand for recision and sue for the lost value of the home plus damages. Three hundred thousand dollars was still $100,000 less than the appraised value if the house had been built correctly, but both builders said `no thank you.' At that price they would make no profit. At this point (mid-December 1987) Bill Arrington ceased marketing the house, but it was just as well. We had defined our home's value at only half what it should be, but at least we could live in it while the suit dragged on.

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