The following story shares the facts about how our house was negligently remodeled, how that construction nearly got somebody killed, and the struggles we’ve encountered trying to hold the responsible individuals accountable.
Final Project Cost:
(as of 5/8/2018)
In October 2014, we purchased our first home. The house had been purchased at auction a few months prior, and “flipped” by the sellers, Dave and Joyce Potter, and their realtor, Jeffrey Krause. At the time, we were aware that work had been done without permits. We would later learn that the work was not only done without permits, but was done deficiently and outside of city and state building code.
In June 2017, I discovered a slight sag in the living room ceiling, where interior walls had been removed. I then discovered multiple roof trusses had completely failed at the peak, where the webbing had come completely disconnected from the top chord.
We immediately filed a claim with our home insurance provider, which was denied due to the failure being caused by either “faulty renovation by the previous owners, and/or wear and tear.”
We were lucky to find Darrell Staaleson, a licensed engineer who was available for a site visit the next day. After beginning the inspection, Darrell was forced to stop and order the placement of temporary shoring to prevent the roof from ending up on the living room floor.
On July 1st we had a licensed, bonded and insured contractor install the temporary shoring in our living room:
The permit information for this work is publicly available and can be found online via the Tacoma Permits office. What you will also find is that NO permitting was pulled for this home during the summer of 2014, and I called the Tacoma permits office to confirm this.
On July 17th, Darrell returned to our home to complete the investigation of the roof trusses, which involved assessing the damages and investigating the cause of the failure. The complete report can be downloaded here, but the most important information would be found on page 14 of the report:
In a nutshell, wear and tear contributed to the trusses acting like stacked framing instead of trusses, and the interior walls had become load bearing. This did not happen overnight. Had an engineer been hired to assess the structural integrity of the trusses before the interior walls were removed (which is required by Building Code), we might not have found ourselves in this situation.
The following drawing by the engineer shows the extent of truss connections that have issues. It’s not just a few. The majority of the connections have an issue of one sort or another.
It was at this time we were encouraged by numerous professionals to contact an attorney. We had a couple of meetings with Robert Casey at Eisenhower Carlson PLLC, and he suggested sending the Potter’s and Krause a certified letter notifying them of the situation and our intent to file a lawsuit. That letter was sent on September 21st, and stated:
This firm represents Derek and Michelle Rippe regarding the house they purchased from Mr. and Mrs. Potter in October 2014. From my discussions with the Rippes, and my review of the property records, it appears that the Potters purchased the house at a Trustee’s Sale on July 25, 2014. They quickly made some improvements to the house, and then closed on the sale of the house to my clients approximately three months later. It is also my understanding that Mr. Krause acted as both the real estate broker and a contractor for the Potters. Under RCW 18.27, house “flippers” must be registered, licensed and insured as contractors. “Flippers” are also liable for construction defects.
During the period of the Potters’ ownership of the house, they removed interior load- bearing walls. This resulted in the failure of at least five of the roof trusses and considerable damage to the home. Emergency repairs have been performed under the guidance of a civil engineer to keep the house from collapsing, but a final repair plan is still under review.
The cost to repair the Rippes’ home will be substantial. They will be making a claim against you for their damages, and likely will be filing a lawsuit shortly. We advise you to immediately notify your insurance carriers of this claim, particularly Mr. Krause’s insurance carrier through his contractor’s license. Your insurers will want to inspect the home before repair work is performed, and my clients will give the insurance company’s inspectors the opportunity to inspect the home within the next two weeks.
Please have your insurance adjusters contact me to make arrangements to have their experts inspect the home.
Contrary to what the letter requested, on September 26th Dave Potter showed up at our front door, unannounced. Michelle and I were not home, but my brother was visiting from out of town and was not fully aware of the ongoing legal situation. Dave entered our home and proceeded to perform his own investigation of the situation.
On October 2nd, all parties involved received an email from the Jeff Krause with their response to the situation. That email stated that the Potter’s and Krause would be taking no responsibility for the truss failure in our home because the required paperwork was signed during the sale of the home, and we had clearly made our own modifications to the house. To quote the relevant paragraphs:
We are very sorry to hear about the failure of some of the engineered trusses at 6009 N 40th St. We are sure this has caused you great distress. We regret to inform you that we are unable to help you at this point and do not assume any liability for your current situation. The house was built in 1981 and was approximately 33 years old when you purchased the home in October of 2014. The attachments included and facts laid out in this email argue our case.
It will be our argument that we had provided you ample time and opportunity to view the home, for you to have it inspected by licensed professionals, provided you our full disclosure throughout the process of the sale, that we agreed on items that would be remedied after inspections, that we had no knowledge of any defects with regards to the engineered roof trusses, and that YOU, in your 3 years of ownership had done your own remodeling, additions, installations to the homes walls and ceilings (Images attached).
IMG_1319.jpg & IMG_1319 – before.jpg
Shows you added a wall, cabinetry and crown moulding. We have no idea what else you’ve done to the house in the three years you’ve owned it.
IMG_1320.jpg & IMG_1320 – before.jpg
Shows that you constructed a new fireplace mantel and again shows you added crown moulding. Again, we have no idea what all improvements you’ve made to the home in the three years you’ve owned it.
IMG_1334.jpg & IMG_1334 – before.jpg
Shows you added a pull-down attic staircase in the entry hallway. We’d argue that the main reasons to install such a ladder would be that you wanted to use the space for storage and likely were accessing the attic space with some frequency. We have no idea how frequently you utilized it nor do we know what you were storing up there.
In conclusion, we feel that this is a claim that Derek and Michelle should be making to their own home owners insurance company. We will not be contacting our insurance company. Again, we are truly sorry that you are having to deal with this situation. We would never knowingly conceal a structural defect. We disclose everything we know about our properties in the short amount of time we own them. We wish you all the best moving forward.
And the referenced images:
First and foremost, Michelle and I both felt extremely violated that Dave Potter had entered our home and taken photographs. Then, to imply that the modifications we have made to this home (adding crown moulding, building out a pantry, installing a facade on the fireplace) could have in any way resulted in the truss failure was nothing short of insulting. In regards to the attic access, that was installed the same day the temporary shoring was installed (July 1, 2017) in order to make life easier for Darrell Staaleson and myself to access the attic and perform the investigation of the trusses. The attic space was certainly never used for storage.
Going back to September 2014, when we looked at the home a second time (before purchasing), Jeff Krause met us at the house and told us about the work they had done. It should be noted that Jeff Krause is related to the Potter’s, and their family business is flipping homes. He had informed us that they had done the work themselves and had “consulted a professional” in regards to removing the walls. I, however, had no tangible proof of this conversation. Looking back, we absolutely should have pursued conversation with “the professional” the seller’s claimed to have consulted.
Reminder: the truss design of this home is such that it should be capable of spanning the 34′ distance without interior walls, but seasonal temperature and moisture changes had damaged the trusses making them unsuitable of supporting the weight of the roof on their own (especially with two-layers of shingles already on the roof).
We had another meeting with Robert Casey at Eisenhower Carlson PLLC, and I had additional meetings with attorneys at Smith Alling PS and Ledger Square Law. The consensus was the same – we would have no realistic legal recourse from a real estate standpoint due to our acknowledgement of the home being worked on without permits, and no legal recourse against the contractor who performed the deficient work because we did not hire the individual. As mentioned before, I believed Jeff Krause was the acting contractor on the home, and he would have been hired by the Potters (who were family). At this point, to file a claim would have cost us $5,000, and we could expect to spend $25,000+ if our case went to court.
I made the decision to file claims with the insurance and bond companies held by Krause (the believed contractor) during the time our home had been renovated. While I had no confirmation or proof of who the contractor was, I still felt the individual who performed the work should be held financially responsible for the failure of the roof trusses. To no surprise, both the insurance and bond companies denied the claim.
I was determined to confirm who was responsible for the deficient construction work on this home, and made the decision on November 2nd to send the Potters and Jeff Krause an email of my own in an attempt to seek clarification:
I’m going to make this email quick, and provide you the opportunity to clear up any facts I may incorrect.
When the problem was discovered in June, I immediately hired a civil engineer to perform an inspection of the structure. Due to the cost of that inspection, you will not be privy to that report. That report, however, states that the failure of the trusses is a direct result of the interior walls that were removed.
There is no point of contention about the information that was disclosed to us. The issue here is that the construction performed was done so in a deficient manner that did not conform to city building code. Removal of the interior walls would have required by law that an engineer verify under seal and signature that the trusses were adequate to span the new distance. To my knowledge, and the information that has been shared with us, this was never done. This resulted in a situation that placed the life and safety of my family and I in mortal peril.
In regards to Washington State Legislature RCW 18.27, you have implied that you hired a contractor, but have chosen not to make that individual known to us. Therefore, I can only assume that you were the acting contractor for the work that was done, as you were a licensed, bonded and insured contractor at the time. If I am incorrect in this, please feel free to clarify whom the contractor responsible for the removal of the walls was.
I have to visit the office of Planning and Development Services when they open tomorrow morning to continue the process of repairing our home. I will be sharing the facts of our situation during my visit. If any of the information above is incorrect, please let me know.
The following day I received a response from Jeff Krause. That email response basically stated that Krause was not the acting contractor on the property, and that they always hire licensed and bonded general contractors to do the work on their “flips.”
If you would have contacted us you would have found that your assumption that I acted as the contractor on this property is incorrect. Yes, I did have a general contractors license at the time. I believe I was licensed for just over three years (2012-2015). And in those three+ years I have never performed the services of one. The main reason is that I’m a real estate agent who likes to occasionally get my hands dirty with landscaping or tiling a backsplash. We have been “flipping” properties since 2009.
If you would have contacted us you would have learned that since we started “flipping” in 2009 we have always hired a licensed and bonded general contractor or multiple licensed and bonded general contractors to work on our “flips”.
In conclusion, We deny all liability. I have already contacted my Insurance Company and Bond Company and inform them not to pay your claim. I have sent them my documented defense, as was laid out in the email to you dated 10/2. If attorneys are needed in the pursuit of the claim against my bond and you lose, I will be asking for attorneys fees. If you decide to pursue a lawsuit against the Potters or myself for failing to disclose a known defect and you lose we will be asking for attorneys fees.
Please have your attorney handle communications with the Potter’s and myself from here on out.
Despite the claim that Krause was not the acting contractor on this home, for whatever reason they still refused to inform me of who was responsible the work.
We had already made the decision not to pursue this matter legally because the financial risk was too great to us (and the odds were not in our favor, as previously mentioned). But I still wanted to know who performed the work on this home.
I called our real estate agent, Susan McCauley, to update her on the situation. She recalled our conversations with Krause about them performing the work and their claim that they did not need permits for removing the walls. She offered to look back through her emails to see what she could dig up.
On November 29th, I received an email from Susan dating back to October 15, 2014. In that email Jeff Krause stated that they did not need permits and had performed the work themselves:
There was no relocation of plumbing and other than adding new can lights, no new electrical was added… only removed from the areas where there were walls. Three walls were removed but there are engineered trusses in the house and none of the walls were load bearing.
I’m a general contractor and did all the work myself. I don’t do HVAC and Roof’s though and will be calling someone to service the furnace and heat pump. Luckily the roof was done when we bought it.
Susan responded with the following:
Did I ever get the Form 17 – My office will need that. You got permits right? Or did you not have to?
She received the following response:
I’ll get you the form 17 first thing tomorrow morning… unless I have it in my email from sending it to another agent… I’ll have to look. We didn’t have to get permits, but everything we hire out is done by licensed and bonded contractors. We’ve done it the other way before and got burned… It’s not worth it.
I have asked the city if interior walls could ever be removed WITHOUT a permit. The response I received was:
The work you describe should always be done with a permit in-hand. The International Residential Code, copied below, states work that is exempt from permit, and includes only minor activities.
You can read R105.2 of the International Residential Code here, https://www.co.pierce.wa.us/DocumentCenter/View/4295, or click here to download the PDF.
In addition, Darrell Staaleson’s Report of Findings states:
The Contractor was also required by the Building Code to have an Engineer verify under seal and signature that the trusses are undamaged and adequate to span the new distance with the interior wall removed.
1. Why were we not made aware of the fact that the work performed on this home had been done so illegally, outside of city and state building code?
From my discussion with three separate attorneys, this responsibility would have lied largely on our realtor Susan McCauley, but it is my opinion that Jeff Krause and the home inspector we hired, Todd Obergfell, should also share in this responsibility. I do not know why Jeff Krause claimed they did not need permits. According to my research, that is not true. I do not know why Susan McCauley took those claims as truth. I do not know why Todd Obergfell did not bring any concern to our attention. It seems to me that all three of these individuals, at some point or another, should have raised red flags in regards to the removal of the interior walls in this home without permits or inspections.
2. Why do we have to be responsible for negligence and damages caused by another individual?
This has been the hardest point for us to stomach, and the most frustrating, to have no options available to us for compensation even though I have evidence that negligent/deficient/illegal work was performed on this home. We did everything right when purchasing a home. We went through the proper avenues, hired professionals, and did everything by the book. Then we come to find out that someone else performed deficient construction on this home, placing our health and safety in mortal peril, and leaving us to suffer the consequences. Somebody could have been killed.
So, what next?
At this point, we have accepted our fate and are moving forward with repairing our home. While we would love to be financially compensated by those actually responsible for this house nearly collapsing, we’ve come to realize that isn’t going to happen. We certainly aren’t looking forward to spending somewhere in the ballpark of another $20,000 to get our home fixed. I suppose this is a “lesson learned the hard way.”
We’re continuing to work with the engineer and are finalizing plans to repair our home. In addition to the 308 plywood gussets that need to be built and installed, there are nine 2×4 top chords that have to be replaced. This means taking off sections of the roof to do so, something we were hoping to avoid… especially with the arrival of a newborn in early March. Performing these repairs after the baby arrives is about the least ideal situation we could have found ourselves in (outside of the roof actually collapsing that is).
From discovering the problem at the end of June, we’ve been doing our best to resolve the issue. We’ve had conversations with and followed the recommendations of numerous professionals. While our actions may not be satisfactory to all parties involved, we have done nothing wrong or illegal.
But we made the decision to share our story in an effort to save somebody else’s life. Fortunately, I’m hyper-aware of our home and things going on with it. Somebody else may not be so lucky to notice a sagging ceiling before the roof comes crashing down on them or loved ones.16