Chinese drywall can turn homes into toxic assets

By George Sells - bio | email

BATON ROUGE, LA (WAFB) - Some call it a cultural thing with the Chinese. Despite mounting evidence, Chinese businesses still are not willing to admit their part in the $15 billion bomb they've dropped on homeowners on the Gulf Coast. In 2004 and 2005, Florida, Mississippi and Louisiana were hit by so many hurricanes that when rebuilding time came, a critical shortage developed for drywall, the big hard plaster sheets that are right below your wallpaper or painted wall.

In the two years after Katrina, building permits were issued for nearly 5,000 houses in East Baton Rouge Parish alone and inside many of those homes, something nasty was being installed. Building suppliers had pressed China to step up drywall production. The Chinese opened new plants, apparently in the filthy, polluted conditions documented a year ago by the program "60 Minutes."

"I'm trying to make people aware and how many people could actually be affected by this and how much drywall came in," Mike Middleton said from the attic of his infected $350,000 home.

One of the problems is the coils in his air conditioner. They should be a shiny copper color, not the dull gray they now display. The dull gray comes from hydrogen sulfide being emitted by the Chinese drywall. It attacks light switches, electrical outlets and electrical junction boxes. One photographed wire should have been a shiny copper color, but it too was gray.

A homeowner in Central says his three-year-old home has the same problem. He found the three feared words on his drywall, "Knauf, Tiangin, and China." The emissions do not only damage equipment right down to alarm systems and phones, but people as well.

Sean Payton, the head coach of the New Orleans Saints, first noticed the problem with equipment.

"Five computer failures," he said. "We're on our fourth hard drive right now."

More important, Payton was worried about his family.

"Sean could smell it all over," said Daniel Becnel, an attorney. "His kids' noses were bleeding."

So, people have moved out of their houses, large and small. A Walker family has moved into a camper next to their house. A man who got married this past weekend can't bring his bride to live in the house he built. Some have moved in with in-laws. Children aren't allowed into houses by their parents because experts suspect the drywall is affecting people, too.

Mike Middleton is a project manager for large commercial projects. He shocked a customer at how fast he restored a building that burned downtown. He knows his stuff and knows costs to repair those toxic assets for homeowners.

"The average person, who doesn't have contacts with construction companies and guys they deal with day-to-day, it's probably going to cost about $70,000," he said.

"They've got their heads in the sand," said Michael Barclay of Barclay Assessments in New Orleans, referring to other homeowners. "They don't want to know about it."

"We've not heard a case yet where an insurance company has honored a claim for Chinese drywall," said Robert Becnel, an attorney.

Worse yet, lawyers allege if insurance companies find out you have the drywall problem, they'll refuse to renew your policy. Here's the text from the second biggest insurer in Louisiana. Not covered are people injured "...from the release of vapors, fumes, acids, toxic chemicals...or other irritants, contaminants or pollutants."

"They'll have a stigma associated with them," Barclay said.

And you can't sell a house that's not insurable, but a white knight is riding to the rescue. A New Orleans judge in his 70s has put these cases on a fast track with speed never before seen by lawyers. Judge Eldon Fallon has designated 30 homes as a test. An army of experts have found the exact type evidence that all homeowners must pull out of their houses and seal in plastic bags. It's so you can get on with fixing your house right now with some assurance you'll be reimbursed.

In fact, the German-owned company in China, which already has examined a house in a Walker neighborhood, appears ready to cave.

"Knauf has said they're interested in identifying every single house with Knauf drywall so they can consider a resolution of the case," Daniel Becnel said.

There are several tell-tale signs that your home might have defective Chinese drywall. Not all Chinese drywall is defective and you do not necessarily have defective drywall if you find the name of the Chinese-based German distributor, Knauf.

The defective product began arriving mainly in Florida in late 2004 after the multiple hurricanes there. Then, Louisiana became victim after the rebuilding boom caused by Katrina on Aug. 29, 2005. Between September 2005 and September 2007, East Baton Rouge Parish issued 4,967 building permits for single family homes and these are the most likely to be affected.

What to look for:

1. Repeated problems with lack of efficiency in your air conditioner and recommendation that that the coils in the exchanger box in your attic be changed. One Baton Rouge homeowner has changed the coils four times in a three-year-old house.
2. A subtle, but constant sulfur-like smell in your home.
3. Any copper wiring in your house, regular voltage or low voltage, that begins to turn a dull gray or black. After a long enough period, it will disable things like fire alarms, burglar systems and any other equipment that uses exposed copper wiring. If you feel you're capable, pull a light switch out of the wall and see if the copper ground wire to the ground screw, usually a green screw, has gone from bright copper color to dull black or gray.
4. Discoloration of some knobs and towel hangers that should be shiny.
5. With a file or knife, scrape away any dark film from a pipe connected, for instance, to your water heater. If you find a shiny copper color underneath the pipe you've scraped you almost certainly have the defective drywall.
6. At any spot (usually the attic), where you can push back insulation and look at the name on the drywall. If you see the words "Knauf, Tianjin, or China," it's very likely you have a problem.

Do NOT try to hide your problem from insurance companies or future buyers unless those difficulties are extremely minor. Most inspectors doing "due diligence" in the home sale will see the problem. Unfortunately, there have been reported cases of a homeowner's insurance being cancelled when it comes up for renewal. Some attorneys are charging one-fourth to one-third of your settlement. In theory, their fee should be over and above your actual damages. A general estimate to strip your home down to studs and change wiring is about $70,000.

The federal court direction above lists all the materials you must preserve for evidence for a future settlement. If you're capable with construction materials, you could do it yourself, but the federal court lists areas in which you should bring in an expert, for instance, on air conditioning coils. We highly recommend making an appointment with an attorney to discuss the case before trying to resolve it solo.

The Baton Rouge Bar Association (225) 344-9926 (as well as several others) has a lawyer referral service that people without a regular attorney can be referred to someone with the specific expertise in a particular area of law. Visit the Louisiana State Bar Association website for phone numbers and more information.

This particular situation with drywall calls for someone familiar with construction law. Generally, this would necessitate using a larger firm with lawyers skilled in construction and insurance law.

DRYWALL SITES