he Federal Trade Commission this week charged the Ward Corp., a Rockville based home-building company with several developments in Maryland and Virginia, with failingto repair substantial construction defects in homes under warranty.
The uncorrected defects included sagging or sloping floors, leaky basements, leaky roofs, inadequate heating and faulty window installation, the FTC said in its complaint. If corrections were made, they often were done improperly or after long delays, the commission added.
Officials at the Ward Corp. were not available for comment after the charges were announced.
The complaint is the first the FTC has issued under its housing program, started in 1979 to investigate home-construction defects, said FTC staff attorney Louise Jung. The commission is investigating a number of other builders throughout the country, and more complaints of this nature are expected in the future, she said.
The FTC could mandate any of a number of remedies, including forcing Ward to fulfill alleged promises and taking the company to court to seek damages for consumers.
Ward Corp. projects in Maryland include: Rockingham in Rockville, Montpelier Manor at Laurel, Montgomery Place in Gaithersburg, Quince Orchard Manor in Gaithersburg, Middleboro Estates in Damascus, Oakmont Manor in Gaithersburg, Foxhall North in Silver Spring, Seneca Highland in Darnestown, Snowdens Mill in Silver Spring, Montgomery Place and Montpelier Manor in Laurel.
The Virginia projects include: Partridge Court in Springfield, Winter Forest in Springfield, Burkeridge in Burke, University Woods in Fairfax County, Kenwood Oaks in Springfield and Prosperity Woods in Annandale.
Jung indicated that the FTC had not found problems in all the subdivisions but would not identify ones where complaints originated.
In addition to the warranties Ward specifically issued in writing, the Maryland and Virginia state laws provide for one-year warranties on new homes, the FTC said.
The commission noted that the company's advertising for subdivisions included such promises as "homes . . . surrounded by beautifully landscaped shade trees" but said that in numerous cases lots were not graded, rocks and construction debris remained and trees were not protected.
Harry Sheinfeld, president of the homeowners' association at Winter Forest, said that he and most of his neighbors experienced numerous problems with construction defects at their Ward Corp. subdivision when they moved in four years ago.
Most of these problems now have been corrected, but it took up to two years to get this done and only after buyers enlisted the help of Fairfax County Superviser Marie Travesky, he said.
"We and most of our neighbors had a whole string of complaints on about anything you can think of that could go wrong with a house," Sheinfeld recalled. "The first two years were absolute hell."
The Sheinfelds' basement flooded every time it rained, for example. But they were more upset about what happened to the 60-feet-deep copse of trees in their back yard, which they were promised would remain. They watched helplessly, in tears, as most of the trees were bulldozed, Sheinfeld said.
Some of his neighbors had difficulties getting VA-insured loans, because their grading "literally sloped down a cliff," he said.
"Some of the things regarding landscaping never got fixed," he added, "but after four years you learn to live with it."
At the neighboring Partridge Court community, Kathy Scheufele said that her husband eventually fixed the defects in their home himself. The beams in the basement weren't braced properly, and the bedroom doors would not close because of the bowing that caused. This was after Ward supposedly had fixed the problem but merely managed to block her access to the washer-dryer, she said.
Scheufele, whose husband Bill is the homeowners' association president at the subdivision, also credited superviser Travesky with getting Ward to repair defects. Travesky's office "knows the homeowners really well because we have been down there so often with complaints."
Travesky said that Ward has not "been impossible to deal with but very difficult to deal with." Company officials' attitude at first was that they should not have do make the needed repairs, she said.
Ward now has taken care of most problems in its Fairfax County subdivisions, but the county still is in dispute with the company over whether it will take care of a storm water facility at Kenwood Oaks and whether it will pave a road at Partridge Court, Travesky said.
In Montgomery County, 39 complaints have been filed against Ward in the past two years with the county's consumer affairs division, and almost all have been resolved to the homeowners' satisfaction, said Eric Friedman who handles all new-home complaints for that office. The number of consumer complaints, most involving repair and service problems, appears to be significantly higher than for other area builders, however.
The FTC's complaint cites the Ward Corp., its principal officer Richard E. Ward, and five Ward subsidiaries: R.E. Ward, Inc.; Ward Development Co., Inc.; Ward Component Systems, Inc.; Richlynn Development, Inc.; and Richlynn Land Developers, Inc.
The commission has scheduled a hearing before an administrative law judge on its charges on May 10.
If the judge concludes that Ward violated the law, the commission could require Ward to take any of a number of actions. Among these are fulfilling its current and future warranty promises, giving notice to past buyers about their warranty rights under state law or ending warranty claims.
The commission also could ask for redress for injured consumers through the courts.