Award of Arbitrator

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WAN Y. CHIN, W.K. CORP., et al.


CASE NO. SC 060473


Pursuant to a stipulation of the parties, the undersigned Justice William A. Masterson (Ct. of Appeal, retired) served as the arbitrator for an arbitration hearing, which commenced on July 17, 2001 and continued on various days thereafter, concluding on August 3, 2001. Appearing on behalf of plaintiff was Robert M. Moss, Esquire. Appearing on behalf of the defendants was Prestholt & Fidone, LLP by Brian Holmberg, Esquire.

Having heard the evidence, reviewed the exhibits and having heard argument from counsel, the following is the arbitrator’s award.


This is a personal injury action by Sarah Shanley, “plaintiff” herein. The action was commenced when she was a minor. Plaintiff claims damages on various theories against a former owner-landlord and former managing agents of a unit in an apartment building in Santa Monica where she lived (WK Corporation, Wan Y. Chin, Jimmy Chin & Nancy Chin, collectively “defendants”). Plaintiff’s claimed damages are in 2 parts: (1) for serious medical problems occurring as a result of a failure by defendants to keep the apartment building in proper repair, & (2) for damages sustained as a result of the inhabitable condition of the apartment where plaintiff lived.

Causes of Action:

Five causes of action are alleged in the 2nd Amended Complaint, being negligence, breach of warranty of habitability, nuisance, intentional infliction of emotional distress, and a violation of Santa Monica’s Tenant Harassment Act.


Plaintiff’s mother first rented the apartment in 1978. Plaintiff has lived in the apartment since her birth in 1982. Plaintiff started having medical problems in the 90’s, experiencing particular severity in 1996. Over the years, she has had 5 surgeries to her nose, involving inter alia the removal of polyps. She has complained of fatigue, sleeplessness, coughing, and has manifested other complaints. She has been treated by a number of doctors, principally allergists, ENT specialists, and most recently a medical toxicologist. Plaintiff’s theory of the case, ably advanced by her experienced counsel, is that she has been poisoned by toxic mold which grew in the apartment as a result of various breaches of duty by the defendants.

Plaintiff carried her burden of proving that there was mold in the apartment that the apartment was not habitable, and that defendants had breached a duty owed to her to provide a habitable place in which to live. (Indeed, able and experienced counsel for the defendants correctly conceded that the apartment was not habitable.) However, that is not the end of the inquiry, at least insofar as plaintiff claims serious personal injury from the condition of the apartment.

The medical evidence (which consumed the bulk of the hearing) was in sharp conflict. The conflict was greatest between that offered by Dr. Ordog for plaintiff, and that offered by defendants through the testimony of Drs. Siegel and Weinstein. The legal issue tendered by this testimony is causation, i.e. whether the condition of the apartment and the evident mold growth was a factor in causing plaintiff’s various illnesses. On this issue, the arbitrator finds that plaintiff did not carry her burden of proving causation by a preponderance of the evidence. In appraising the expert medical testimony, the arbitrator was guided by Pacific Gas & Electric v. Zuckerman, 189 Cal App 3rd 1113 (1987) which holds that the opinion of an expert is no better than the facts upon which the opinion is based (p. 1114.) In particular, the arbitrator finds that the opinion of Dr. Ordog, the principal medical witness for plaintiff, did not have sufficient factual underpinning to be probative on the causation issue.

Although plaintiff is not entitled to recovery for her medical problems, she is entitled to damages for the uninhabitable condition of the apartment. Recovery for these damages is based on the following two causes of action: negligence and breach of warranty of habitability. Plaintiff’s expert witness Allan Snyder qualified as expert on the subject of property management and testified that defendants’ conduct fell below the standard of care required for property management.

As noted in the preceding paragraph, the arbitrator finds liability on only two of the five causes of action alleged. Specifically, the arbitrator finds that the acts and omissions of defendants do not rise to the level of an intentional tort, so no recovery is allowed on the cause of action for intentional infliction of emotional distress, or a cause of action for violation of Santa Monica’s Tenant Harassment Law, which seems to require a finding of “malice” in most of its parts. The arbitrator also finds that the unique facts of this case do not fit the accepted legal definition of “nuisance.” Finally, given the absence of any finding of an intentional tort, the subject of punitive damages is not reached.

Since there is liability on two causes of action, the remaining issue is the amount of damages. The arbitrator finds that defendants should pay general damages of $75,000.00 to plaintiff. The reason for assessing this amount of damages are as follows. Although this rent-controlled could never have been styled as the “lap of luxury”, its condition seriously deteriorated starting in the late `80’s – a time coincident with defendant’s assumption of ownership and management. It is true that defendants, from time to time, would respond to repeated complaints by plaintiff’s mother and effect some repairs. Nonetheless, it is fair to say that for an extended period of time, the condition of this apartment gave new meaning to the term “uninhabitable.” Given the conditions under which the plaintiff had to live, the sum of $7,500 per year for the approximate 10 years of the deplorable state of the apartment is reasonable compensation to plaintiff for defendants’ breach of duty, both in negligence and in warranty.


Plaintiff Sarah Shanley shall have and recover from defendants WK Corporation, Wan Y. Chin & Nancy Chin general damages in the sum of $75,000. Each side shall be responsible for its costs, expenses and attorneys’ fees, such being the agreement pursuant to which this matter was brought to arbitration.

Dated: 08-13-01

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