Source: The Wall Street Journal, April 1, 2012
By: Josh Barbanel
The problem of mold—that furry, slimy or powdery substance that grows in damp places—just got a lot more dangerous, at least for landlords and co-op and condo boards in New York.
Four years ago, a key appellate court decision in Manhattan blocked millions of dollars in legal claims for damages for health effects of mold in buildings, saying that the scientific evidence that mold caused illness was in dispute.
But a few weeks ago that conclusion was overturned by a split 3-2 decision by another five-judge panel in the same court that found that the scientific literature was now “indicative of a causal relationship.”
The decision has been the talk of condo and co-op lawyers since, who worry that it will lead to a new wave of personal-injury lawsuits for mold injuries, driving up insurance rates and costs for building owners.
In the current case, Brenda Cornell, who once lived in a ground-floor apartment above a moldy basement in a Hell’s Kitchen tenement, filed a complaint seeking $11.8 million in damages, primarily for health problems.
The former owners of the building had argued that it wasn’t possible to link her conditions to mold dust that wafted up from the basement during the brief period when a work crew began removing debris from the basement in 2003. Attorneys for the previous owners didn’t respond to a request for comment.
The new appellate decision said the previous decision hadn’t ruled out the possibility that “dampness and mold can ever be considered the cause of disease.” And it found that several new studies added to the weight of evidence on the theory.
Eva Talel, counsel to the division of the Real Estate Board of New York that represents residential building managers, said that the decision provides “an opportunity” for people who claim they have “suffered personal injury by reason of mold.”
She said that she hoped the New York Court of Appeals, the state’s high court, would quickly take the case “to give us true clarification.” But she said that under the court’s procedural rules it wasn’t clear whether that would have to wait until after the case was sent back to the lower court for trial.
“It is going to result in a heck of a lot more lawsuits being filed by people who have mold- and moisture-related conditions and suffer from health effects,” said Bill Sothern, a certified industrial hygienist who sometimes testifies about mold damage in court. He is the founder of Microecologies, a mold inspection and consulting company.
Suits on mold made headlines a decade or so ago across the country, and in New York some lawyers began making mold cases a specialty. Mold-related insurance claims soared.
In one case filed in 2003, Bianca Jagger stopped paying rent and sued her Park Avenue building because of health problems she said were caused by mold. She eventually lost the case, after her landlord showed that under her temporary visa she was not entitled to the rent-stabilized apartment in the first place.
In buildings, mold can feed on damp sheetrock, wallpaper glue, wood and other substances. Mold exposure has been linked by some studies to asthma systems, cough and wheezing, though for most people the symptoms disappear when the exposure ends.
City officials say building owners are supposed to quickly clean up mold, and deal with leaks, roof or masonry problems, though by one measure the problem may be getting worse. Last year housing inspectors issued 15,942 violations for mold-related conditions, a 19% increase from 2007. The number of the most serious category of violations rose by 67% during the same period.
But personal-injury mold suits went into a lull after the 2008 appellate-court decision brought by a family living in a co-op apartment in a basement and first-floor co-op apartment on East 52nd Street. That decision, known as the Fraser decision, found that there was no scientific consensus that air-borne mold spores caused illnesses. It barred testimony from experts who blamed mold for health problems. Though the appellate decision only directly applied to Manhattan and the Bronx, lawyers said it influenced many other courts as well.
The latest case dates back to 2003, when a new owner bought the building and began cleaning up the basement which had been damaged in flooding before the sale. Within days, Ms. Cornell, who worked in the music industry, moved out of the apartment, complaining about rashes, dizziness, difficulty breathing and severe headaches.
She settled her lawsuit with the new owners for a relatively modest sum, but is still seeking damages from the prior owners of the building, who expected the case to be dismissed, lawyers said.
The majority opinion, written by Justice Sallie Manzanet-Daniels, said the suit can proceed, noting several new studies on mold illness. But a dissent by Justice James Catterson said Ms. Cornell’s lawyers had failed to show that her theory of mold illness “is generally accepted by the scientific community.”
Morrell I. Berkowitz, who represented Ms. Cornell, said, “This is not hocus-pocus junk science, and I should be able to go before a jury.”
Both Ms. Cornell and the plaintiffs in the Fraser case were examined by the same doctor, Eckardt Johanning, who specializes in Family and Occupational Medicine.
He testified that to “a reasonable degree of medical certainty” her problems were due to her exposure to “atypical mold exposure in her apartment, after ruling out other possible causes for her condition.
But the New York City Health Department does not keep counts of cases of health problems caused by mold, because of the difficulty of identifying mold as a cause, according to Sam Miller, a department spokesman.