“Spoliation” Rule Could Bar Damage Claim

Published on: July 22, 2004

The call comes, as these calls always seem to come, at midnight. Water is pouring into two units and an adjoining common area from a breach in the newly installed roof. The trustees contact a contractor, who makes the necessary repairs the next day. The quick action pleases the affected owners, who were not enjoying the waterfall in their living rooms. But, unfortunately, the repair also destroyed the evidence the association needs to pursue a claim against the developer or roofing company responsible for the shoddy work.

A recent Massachusetts case illustrates this risk, which it is all too easy for association managers and trustees to overlook. Plaintiff and defendant owned abutting units in a Cambridge dwelling, sharing a common roof, a common party wall, and a brick foundation wall. Defendant undertook major renovations to her unit, which, Plaintiff claimed, caused extensive damage to the roof and to the foundation and party walls. She repaired the roof and other problems, and then filed suit against Defendant to recover the costs.

To support her claim, Plaintiff had obtained an expert witness, who investigated the property before it was repaired, and was prepared to testify, more or less, that the renovations were responsible for the damage. But Defendant argued that the expert’s testimony should be barred and the suit dismissed for lack of supporting evidence, because the repairs were made and the damaged components removed, before she was able to have her own experts assess the damage and evaluate the likely causes.

An Unfair Advantage

Massachusetts Superior Court Justice Julian Houston agreed. By removing the damaged components, Justice Houston explained, Plaintiff violated the “spoliation” rule the Massachusetts Supreme Judicial Court outlined in a 1989 decision, Nally v. Volkswagen of America, Inc. That decision held that expert witness testimony will be excluded if one party destroys or alters evidence before the other party can examine it. Although courts have some discretion in applying that rule, Justice Houston said, in this case, “the plaintiff could gain an incurably unfair advantage” if her expert testimony on the damage and its cases went unchallenged. While acknowledging the “draconian” effect of this ruling, which invalidated virtually all of Plaintiff’s claim, Justice Houston ruled, “No other remedy adequately cures the plaintiff’s actions.”

This was not a happy outcome for Plaintiff, to say the least, and it is a result that community associations clearly would want to avoid. That means, among other things, that association trustees and managers must think before they act – good advice in almost all situations, but essential when there is a risk of damaging or destroying evidence needed to support a construction defect or negligence claim.

As a first step, if you are dealing with a damage situation in which a future claim is possible, you should contact your association’s attorney to determine what evidence you should try to preserve. Before removing or altering that evidence, you should notify the party or parties you plan to hold responsible for the damage of your plan to repair the element, and give them an opportunity to inspect and evaluate the deficiency the association perceives. While you should make every effort to provide reasonable advance notice before you begin any repairs, what constitutes “reasonable notice” and your ability to provide it will depend on the situation.

Now or Never

If the roof is about to collapse, you might well tell the responsible party to check it out “now or never.” But if the claim involves decorative trim that was installed incorrectly, the repair won’t have nearly the same urgency, and a court would be less likely to view that “now or never” notice as either reasonable or fair.

Common sense has to provide your guide in these situations. If water is pouring through a gaping hole in the roof, you obviously have to deal immediately with the problem, even if that means destroying evidence in the process. Spending $50,000 to repair water damage in order to preserve a $50,000 construction defect claim doesn’t make a lot of sense. On the other hand, if a temporary measure – throwing a tarp over the hole – will prevent further damage and preserve the evidence, that’s what you should do.

Also, while the “spoliation” rule requires giving a potential defendant the opportunity to evaluate the evidence of a damage claim, sometimes strategic concerns will argue against that. When you put potentially responsible parties on notice that you are contemplating a suit, you create the risk that they will shed assets and take other steps to render themselves “judgment proof.” This is not a concern if you are dealing with a large corporation, but it is a very real concern with single-purpose entities — a category that would typically include the developers community associations are most likely to sue.

In our defective roof example, let’s assume temporary measures will suffice to control the leak, but a large section of trim is dangling dangerously and requires immediate replacement. You might well want to go ahead and make that partial repair, even if it means sacrificing the ability to recover the $10,000 cost, in order to avoid giving the developer or contractor advance notice that you may be planning to pursue a much larger claim.

Creating a Record

In situations where you have no choice but to repair over the evidence, or where the responsible parties don’t respond to the invitation to inspect before the repairs are begun, you should take affirmative steps to preserve the record through photographs or videotape, reflecting conditions before the repair, intermittently during the repairs, and when the work is complete. This is not as solid as first-hand evidence, but a good photographic record would enable you to build a fairly compelling argument to support the testimony your expert witnesses will provide, or to replace it, if a court applies the spoliation rule and refuses to accept your expert, as the court did in Plaintiff.

Although the spoliation rule is severe, judges do have some discretion in applying it. In doing so, they will make an equitable judgment, weighing the competing rights of the parties involved. Your position will be strengthened if you can demonstrate that you made a reasonable effort to allow the responsible parties to review the damage, and then took steps to preserve the record when the parties failed, for whatever reasons, to inspect the evidence first-hand.