$19.48 Million Arbitration Award for Aurora Townhome Association Against Century Communities

Residents of a 17-building, 82-unit townhome community in Aurora, Colorado began noticing serious problems with their homes not long after moving in. Foundations shifted. Water leaked through walls and roofs. Structural framing was improperly built. Drainage systems failed. Fire-code violations were found throughout the development. The community's homeowners' association brought claims against Century Communities, Inc., the publicly traded builder that had acted as declarant, developer, and general contractor for the project, along with related corporate entities.

The case went to arbitration before an arbitrator at Heiserman Resolution Trust Company. The proceedings stretched across more than 17 days, with engineers, geotechnical experts, and cost estimators testifying in detail about the scope and cause of the deficiencies. A central issue involved the site itself: the land had been over-excavated because of concerns about swelling soils, a problem that contributed to the foundation movement documented throughout the community.

The arbitrator found that Century Communities and its related entities had breached their duty to construct the project with reasonable care. The award addressed each category of defect, and the arbitrator ruled that the corporate entities, including the parent company, acted together in concerted action, rejecting attempts to isolate liability within subsidiary shell companies.

The arbitrator issued an award of $19.48 million to the association. A separate hearing on attorney fees and costs was scheduled for later in December 2020, with the possibility of an additional award on top of the base amount. The team ultimately recovered more than $8 million in attorney fees and costs as well.

The Burg Simpson team was led by Mari Perczak, who served as lead trial counsel, alongside Mike Menghini, Diana Sada, Ryan Pardue, and Joe Smith. Perczak described the result as 'the largest [arbitration award] so far, in either a verdict or an award, in residential construction in the state of Colorado,' as reported by Law Week Colorado.