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Judge sides with insurance company in Waukesha condo lawsuit

On Friday, federal judge Lynn Adelman sided with the insurance company Travelers Indemnity Company.
Horizon West condominium building
Posted at 11:57 AM, Nov 18, 2022
and last updated 2022-11-18 18:25:03-05

WAUKESHA, Wis. — A judge ruled against the residents who lived in a Waukesha condominium building facing the threat of collapse, displacing them from their homes.

On Friday, federal judge Lynn Adelman sided with the insurance company Travelers Indemnity Company. The insurance company had been sued by homeowners under the name Horizon West Condominium Homes Association. Judge Adelman agreed to the insurance company's motion to dismiss homeowners' case, according to court documents.

Homeowners wanted money from the company per their insurance policies; the insurance company argued coverage did not apply at the time. [Read the judge's concluding remarks at the bottom of this report].

Horizon West Condominium
Horizon West Condominium

"It's not about me it's a whole community. Trying to push this thing forward to not get emotional over it is hard," said Patricia Esposito.

Esposito and her husband planned to make their Horizon West condo their last home before they were forced to leave in December 2021. Since then, the couple has bounced around between hotels and apartments.

Like many of their neighbors, they are still paying the mortgage for a place where they cannot live.

"We're comfortable for now, but it's not permanent. In April, we have to sign another lease and I don't know what but the price on that's going to be," Esposito said.

"Very disappointed. My hope's not gone completely because we will be appealing the decision," said Laurel Peterson, another condo owner.

She and her wife Theresa made a home in the Horizon West building.

"It's really like a bad nightmare that you can't wake up from," Peterson said.

Meanwhile, the homeowners are being sued by the City of Waukesha to demolish the building, an order they say they cannot afford.

As TMJ4 News reported extensively at the time, 70 people living across 49 units were all abruptly forced to move from the Horizon West Condominiums in Waukesha back in December. On Jan. 3, the City of Waukesha and the fire department ordered that the Horizon West Condo must be torn down within 120 days. Authorities cited the building's steel columns were rusting and therefore structurally deficient.

Residents say they'd rather see the building get fixed instead of demolished. But documents show the building's contractor says, "The repairs to the building far exceed the value of the building as it is now".

A GoFundMe has been set up to help those displaced by the emergency evacuation.

GoFundMe aims to help displaced Horizon West Condominiums residents in Waukesha

Horizon West Condominium Building, located just south of the city's downtown area, was built in 1966. The fire chief called the building's design "unique" and that they are not aware of any similar buildings with structural issues. Fire Chief Howard described the discovery of imminent collapse like "peeling an onion," as the condo association that owns the building, as well as the fire department slowly learned of more issues with the building's construction.

The fire chief said in a strange way a previous windstorm that damaged the Carroll University area and peeled soffit off the condo helped exposed issues that probably would not have been detected until something "catastrophic" would have happened with a balcony.

Read the judge's concluding remarks:

"These reports generally reaffirm that the underlying damage to the property was caused by rusting that had been occurring for many years prior to the commencement of the policy period. Some of the reports mention other building defects, such as the lack of required fire protection around the building’s structural components ... but those defects would have been present at the start of the policy period and would fall within other exclusions, such as an exclusion for faulty design and workmanship...The plaintiffs also suggest that the engineers’ intentional removal of balconies from the building contributed to the building’s instability... but even if the removal occurred during the policy period, the resulting harm (building instability) would be excluded by the exclusion for general building... instability that does not result in an abrupt collapse. Accordingly, I conclude that granting leave to amend would be futile and will dismiss this action with prejudice."

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