Wednesday, August 26, 2009

High court considers Hanks’ home dispute

Actor, wife also seek damages from home’s architect

Express Staff Writer

Courtesy photo by Getty Images Actor Tom Hanks poses with his wife, Rita Wilson. The Idaho Supreme Court heard arguments on Friday regarding a longstanding home construction dispute between the couple and Storey Construction of Ketchum.

The action in a seven-year legal dispute between actor Tom Hanks and Storey Construction moved to Boise last Friday when the Idaho Supreme Court heard oral arguments pertaining to allegations that the actor's home north of Ketchum was built with defects.

The question before the court was whether Hanks and his wife, Rita Wilson, can pursue further litigation against Storey Construction, the Ketchum company that built the couple's home.

The last round in the dispute went to Storey in 2008 when 5th District Court Judge Robert J. Elgee ruled that the case was settled in earlier litigation. Hanks and Wilson appealed that decision to the high court.

Meanwhile, Hanks and Wilson are also seeking financial compensation from Lake/Flato, a San Antonio, Texas-based architectural firm that designed the couple's home. A claim was filed against Lake/Flato by Hanks and Wilson in 2007 and is pending before the American Arbitration Association.

Hanks' attorney, John Hanover of Los Angeles-based Peckar & Abramson, said Monday that Hanks and Wilson are seeking about $1.5 million apiece from both Storey Construction and Lake/Flato. Hanover said the claims against the two companies "do not overlap" because Hanks and Wilson are alleging "construction defects and design defects."

Hanks and Wilson have alleged numerous defects in various court papers filed in the cases, but Hanover said the most serious was a leaking roof, which caused damage to other parts of the home.

He said the couple spent more than $2 million last summer on repairs.

"The home now does seem to be performing well," Hanover said. "The home at least seems to be safe, warm and dry, which is what they wanted."

'High-end residential villa'

Idaho Supreme Court documents describe the Hanks and Wilson home as a "high-end residential villa." The $10 million home is on an 11-acre site with several surrounding guest cottages.

Legal proceedings over the home started in 2002 when Storey completed construction and then filed a claim with the American Arbitration Association seeking an unpaid contract balance. Hanks and Wilson filed a counterclaim with the arbitration association alleging construction defects.

In 2003, the association ruled in Storey's favor and awarded the company $1.85 million in contract balance, interest and legal fees.

The case was seemingly over, but in 2007 Hanks and Wilson filed another claim with the arbitration association alleging that "latent" construction defects had been discovered. Storey then filed a lawsuit in 5th District Court to block further arbitration on the legal principal of res judicata, which means that the issue had already been litigated and resolved.

At Friday's hearing, the high court justices did not seem agreeable to Storey's argument that the case was settled.

The Associated Press reported Saturday that Storey's argument was met with "skepticism" and the justices pointed out that "the contract between the couple and the construction company didn't specifically ban them from bringing new claims for damages as new problems were discovered."

A Supreme Court ruling on the case is not expected for several months.

"You never know how they're going to turn out," Storey attorney Miles Stanislaw said Monday. "But I've never been to a hearing that I'm not confident about the outcome.

"If Storey wins, that will be the end of the story for Hanks. If Hanks wins, it will start a whole new series of litigation.

"I think it's apparent that the Hankses are pretty desperate to find someone to pay. All the work that they've done hasn't been to repair anything, it's been to make improvements to their home. This is all about getting a free remodeling for their home."

Wilson, who attended Friday's court hearing, issued the following statement Monday to the Idaho Mountain Express:

"I never thought it would come to this, but it is important to resolve, as it seems like lots of consumers could be hurt by a similar situation—where there is defective construction that is hidden for years. We are looking forward to the court's decision and to putting this all behind us and enjoying our home in Idaho."

Terry Smith:

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