Attorneys invited to comment and will be contacted for a consultation to see if they may want to take over. The numbering and bullets is different here than in the original.
Comes now, the Plaintiff, Laura Hammett, (hereinafter referred to as “Hammett” or “Plaintiff”), in pro se, who in support of this Complaint, states and alleges as follows:
PARTIES, JURISDICTION AND VENUE
Hammett is an individual and is a resident of Faulkner County, Arkansas, and was at all relevant times that gave rise to this lawsuit.
First American Home Warranty Corporation (“FAHW”) is incorporated in California, has an agent for service of process in Fayetteville, Arkansas and provided home warranty policies in Faulkner County at all relevant times of the events that gave rise to this lawsuit.
Nicholson’s Heating and Air Conditioning, Inc. (“Nicholson”) is incorporated in the state of Arkansas and did business in Faulkner County at all relevant times of the events that gave rise to this lawsuit.
Nicholson is vicariously liable for the actions of its employees, agents and contractors by the theory of Respondeat Superior.
SmartCool of Arkansas, Inc. (“SmartCool”) is incorporated in the State of Arkansas and did business in Faulkner County at all relevant times of the events that gave rise to this lawsuit.
SmartCool is vicariously liable for the actions of its employees, agents and contractors by the theory of Respondeat Superior.
FAHW, SmartCool and Nicholson are collectively called “the Defendants”.
Doe defendants 1 to 99 may be determined through discovery.
The Faulkner County Circuit Court shall have original jurisdiction of all justiciable matters herein, which are not otherwise assigned pursuant to the Arkansas Constitution, pursuant to Ark. Code Ann. § 16-13-201.
Venue is proper in Faulkner County, Arkansas, pursuant to Ark. Code Ann. § 16-60-101. A substantial part of the events or omissions giving rise to the claim occurred within Faulkner County and the plaintiff resided in Faulkner County at the time of the events or omissions giving rise to the cause of action.
This lawsuit involves the following issues: (1) Fraud in the inducement; (2) Rescission; (3) Promissory Estoppel; (4) Negligence; (5) Reckless Endangerment; (6) Bodily injury; (7) outrage; (8) violations of the Arkansas Service Contracts Act and (9) fraud.
This action was commenced within the applicable statute of limitations as the statute of limitations for promissory estoppel, fraud in the inducement, fraud, negligence and reckless endangerment causing personal injury and outrage claims are each three years (Ark. Code Ann. § 16–56–105); and no events giving rise to the suit took place more than two years and six months before the suit was filed.
Introduction
Plaintiff obtained a home warranty through escrow on the purchase of her home. Defendant First American Home Warranty Corporation sent a “Contract and Home Warranty Guide”, (“the Contract”). It states, in part:
“First American Home Warranty is here to offer you peace of mind when covered breakdowns occur and to provide you with quality service when you need us most.”
When Plaintiff’s HVAC broke down about a week after moving into her home, Defendant FAHW did not cause the replacement or repair of the unit.
Instead, the Defendants worked in concert in a ruse to allow FAHW to keep the premium paid on the behalf of the plaintiff without providing the service promised, with the intent of extracting thousands of dollars more from the Plaintiff to be paid directly to SmartCool or Nicholson.
FAHW and Nicholson conspired to defraud the Plaintiff by denying the claim on the pretextual ground that the fault was a pre-existing condition.
FAHW and SmartCool promised SmartCool would make a service call on four days, then pointed the finger at each other and the plaintiff when SmartCool failed to show up each of those four days.
Only because Plaintiff has good documentation and the Defendants have a horrible reputation will the Plaintiff prevail.
The Plaintiff asked to rescind the Contract the day she read it for the first time, April 9, 2018.[1]
She would have replaced the unit herself immediately and gone to arbitration to be reimbursed for the cost of replacement on the theory of fraud in the inducement. She should have been awarded the cost of replacement minus the cost of the policy.
Instead, FAHW agreed and promised they would fix or replace Plaintiff’s HVAC and would not deny the claim for any reason.
FAHW failed to keep this promise.
When FAHW and its contractor Nicholson found they could not fix the unit cheaply, they concealed the fact from Hammett. They strung her along and gave her the run-around. Ultimately, they did what can be described as “gaslighting” Hammett.
The result was to cause Plaintiff not only aggravation and loss of occupation, but physical injury that may be permanent.
General Allegations
At the time of the occurrences complained of Plaintiff’s chosen occupation was restoring homes and reselling them. She has also restored a church and a community center building for charity.
In anticipation of working in the Central Arkansas area, the plaintiff purchased two homes for personal residence in February and March of 2018. (All dates are 2018 unless specified.) The first in North Little Rock was for her son to live in with his small family and had an area downstairs for Plaintiff to stay in, like a “mother-in-law unit”. This property is called “the NLR house”.
Hammett had also purchased a house in a non-judicial foreclosure as a fixer in February. That is called “the Avilla Heights house”.
While Hammett was pulling wall-paper off in one of the rooms in Avilla Heights, she met the man of her dreams, Mike Hammett. Mike contacted the Plaintiff off an internet dating website. They met in person the next day. It was love at first sight and they have had the best two years of their lives since, in spite of the damage caused by the defendants in this case, the Coronavirus, the stock market crash and civil unrest.
Plaintiff decided to live with Mike Hammett after close of escrow on the NLR house. She bought the second house on Lake Conway because it had more privacy and space for their boats and R.V. This property is called the “Gold Lake house”.
The address of the Gold Lake house is 16 Gold Lake Club Road, Conway, Arkansas, 72032.
Both homes were “move-in condition”.
Plaintiff was represented by the same real estate agent on both purchases.
The real estate agent is a daughter of Plaintiff’s Women’s Bible study host and dear friend, a member of the quorum court in Searcy County. Plaintiff believes the real estate agent was also misled by FAHW.
The real estate agent suggested Plaintiff use First American Home Warranty to buy a policy that was supposed to cover unforeseen problems with the HVAC and other systems in the house.
Plaintiff was a real estate broker herself for decades, actively selling homes in the late 1990s until about 2007 in California.
She had listened to several presentations by Defendant FAHW during that period and suggested numerous buyers she represented ask for the sellers to buy a policy for them from FAHW.[2]
The information that she passed along included a story she heard of how a dishwasher broke in the first weeks of owning a home and the home warranty company replaced it with a brand new one.
She also repeated what she heard in the FAHW presentations that sellers were not as likely to knock $400 off the price of the home as they were to buy a $400 policy.
The policy was supposed to give peace of mind to the buyer and seller that in the unfortunate event of a failure of a unit in the home, costly and time-consuming litigation would not be required to affix blame between buyer and seller.
Based upon the representations several FAHW representatives made to Plaintiff and promotional literature FAHW distributed, Plaintiff accepted her real estate agent’s suggestion.
Plaintiff does not believe her real estate agent received compensation in violation of Section 8 of the Real Estate Settlement Procedures Act, 12 U.S.C. § 2607 (RESPA) for suggesting Plaintiff purchase the policy.
Plaintiff believes her real estate agent was also duped by FAHW.
Both Mike and Laura Hammett have been in the building industries for decades, but their home is their sanctuary and they don’t have the time or energy to fix problems in their own home…like the cobbler’s kids have no shoes. They did not want their home to be a fixer and told this to their Realtor.
Both sellers gave disclosure statements that said there were no problems with the HVAC.
The seller of the Gold Lake house was a retired real estate agent and gave a detailed description of having fixed several problems, none of them regarding the HVAC.
Plaintiff and her son inspected the NLR house, finding two minor problems, one where venting of the HVAC went through the roof. The seller had the vent flashed and corrected the other problem.
Plaintiff’s son inspected the Gold Lake house and found nothing of concern except water pooling by the front door and he was disappointed that the boat house belonged to a neighbor.
Mike and Laura Hammett inspected the Gold Lake house about a month later and found nothing of concern. (The pooling water has been a problem only once in the two years they lived in the house, and it was corrected by cleaning and installing new gutters.)
Before selling real estate, Plaintiff was a combination building inspector for a large county for 10 years and has “flipped” about 20 houses using investors’ money. Several of her represented buyers and investors were repeat clients. Plaintiff also served as an expert in premises and construction defect cases. Hammett’s older son grew up in two real estate and construction families, has a college degree in the field of solar energy installations, and has worked in several construction fields. Mike Hammett became a carpenter at 17, has worked in construction and log truck driving ever since and is a tournament bass fisherman who does much of the maintenance on his boats himself. Hammett felt comfortable that she was buying two good structures after the three inspected them.
In the case that any issues did present, Hammett asked for a home warranty policy. Her agent Lora Blair suggested FAHW and the sellers agreed to pay, making Hammett the owner of the policy.
FAHW did not require any further inspection before issuing its policy.
Unfortunately, within a week of moving into the Gold Lake house, the HVAC failed. It was below freezing outside and the condenser had ice on it.
There is no way Plaintiff could have discovered the malfunction during the inspection period if it did begin before she purchased the home warranty. The heat pump causes the house to heat until temperatures fall below freezing, when the heat strips kick in. The weather was not below freezing at the inspection. Checking for a freon leak takes special equipment.
Hammett had run the unit at the inspection, and it seemed to work well.
It is possible the seller knew the HVAC was not functioning well and omitted that from the disclosure statement. Plaintiff chooses not to make the seller a co-defendant but will not oppose if FAHW files a motion to file a third-party complaint or cross-claim on the condition that undue delay is not caused. Plaintiff had no luck finding the seller to ask them about the HVAC.
Whether the seller knew of the problem or not is irrelevant to Plaintiff’s claims. Plaintiff rejected the adhesion contract written by FAHW and is not suing for breach of contract. She is suing for fraudulent inducement and promissory estoppel.
Defendant FAHW does not give a copy of their adhesion contract to the customer until after escrow closes and they are paid. The buyer never signs the contract. Mail was not being delivered to the NLR house properly, and Plaintiff never received that contract. The Conway house contract arrived a few days after escrow closed.
On the freezing cold morning of Sunday, April 8, 2018, there was ice on the condenser of the HVAC at the Conway house. Plaintiff believed this to indicate a lack of R-22 in the system and that the system might incur irreparable damage if she continued to run it. She called Defendant FAHW’s customer care number.
They told Plaintiff that her inoperable heater would be treated as an emergency and they assigned the job of diagnosing and repairing it to Defendant SmartCool.
A neighbor dropped by the Plaintiff’s house and said her daughter dispatched companies for home warranty claims. The neighbor said her daughter saw plaintiff’s street name on a claim and called her mother to see if she knew Hammett. The neighbor forwarded advice from her daughter to make a check-up call to encourage FAHW’s contractor to show up, because they often would not.
Later Plaintiff learned that the Neighbor’s daughter worked for a third-party contractor to Defendant FAHW. The neighbor’s daughter no longer works for that company but has not been able to talk directly to Plaintiff, because she was being treated for cancer.
When Hammett called them, SmartCool’s answering service confirmed that the HVAC company would be to the plaintiff’s home on Sunday, April 8, to fix the unit. The plaintiff stayed home in freezing temperatures all day. Defendant SmartCool’s technician did not show up. They did not call.
On Monday, April 9th, the plaintiff called First American Home Warranty. She was told that Defendant SmartCool did not make calls on week-ends – ever!
Hammett asked for a different contractor. Nicholson Heating and Air was assigned. They could not get to the plaintiff’s home until Tuesday, April 10.
Hammett read the contract for the first time on April 9th. There were several clauses that troubled her, including severe limitations to bringing any kind of suit against the provider and limiting damages.
Hammett also looked at online reviews of Defendant FAHW and found that the vast majority were complaints of receiving “the runaround” and often not having problems fixed.
Hammett, whose name was Laura Lynn before her marriage, wrote an email on the 9th and sent it to the proper email to cancel policies. The email sent from Plaintiff’s cell phone said:
“To First American,
“I am requesting a refund on policy number 1055507801. My phone number is (760)966-6000. Address 3900 Glenmere Rd, North Little Rock, AT(sic), 72116.
“The reason I am cancelling is that I have lost confidence in your company because of the poor response on a claim on another house I own. That policy is 10558900301 on 16 Gold Lake Club Road, Conway, AT(sic), 72032. Both First American and the original contractor assigned lied to me and led me to believe restoring heat to my home was an emergency priority. In actuality, the company assigned never works on weekends and they did not make me first in the morning on Monday, as promised when I called them late Sunday evening to see where they were.
“I will wait to cancel the Gold Lake Club property if my claim is denied for some reason.
“It would show good faith on your company’s part to waive the proration on Glenmere which went into effect 37 days ago. Because I did not make any claim in that period, I could not know that First American would leave me without heat for over 14 hours and be so deceptive that I did not even buy a space heater to get me through the frigid night.
“Thank you,
“Laura Lynn”
The policy with no claims was “cancelled” and a refund made less a “processing fee”.
First American acted as if they were going to honor the HVAC claim and did not confirm or deny cancellation of the Gold Lake Club policy explicitly.
It appears it was Defendant FAHW’s intention to fix the Plaintiff’s HVAC at that time, but only if it could be repaired, not replaced.
If the unit needed replacement, as it did because parts are no longer available for repair, Defendant FAHW had no intention of replacing. They did not tell Plaintiff this, but by their actions and reports that this was habitual for them, Plaintiff eventually came to believe it to be true.
For instance, in Diaz v. First American Home Buyers Protection Corporation (previous name of FAHW), U.S. District Court, S.D. Cal case no. 09-CV-00775[3] in their Third Motion to Dismiss at 8, FAHW objects to a class action on the basis that it would necessitate “tens or hundreds of thousands, of mini trials.” They are aware of that many complaints.[4]
The effect of the rescission was two-fold.
Pre-rescission, by fraudulent concealment of their common practice of denying claims in bad faith and failure to provide the adhesion contract prior to purchase FAHW induced the owner of the policy to obtain coverage from them rather than a reputable company.
This leaves liability for fixing problems that come up before the rescission with FAHW.
After the rescission, the Defendants each made explicit promises which Hammett justifiably relied on that caused her to refrain from buying an HVAC system and having it installed.
Here, Hammett offered to let FAHW keep the money paid for her policy if they promised they would fix the HVAC and any other issues without the objectionable limitations inserted in the adhesion contract. (Promissory estoppel is enforceable in the absence of consideration, but in this case, there was consideration paid to FAHW.)
FAHW through their employees and contractors agreed explicitly and implicitly to repair or replace Hammett’s HVAC and the claim would not be “denied for some reason”.
SmartCool and Nicholson made promises to Hammett that they would make service calls, diagnose problems, report back to FAHW and correct the problems for compensation offered by FAHW plus $75 from Hammett when they completed the work. There was no written contract between Hammett and SmartCool or Nicholson. Their rights and duties arose from promissory estoppel.
On April 10, 2018 Defendant Nicholson sent technicians to Plaintiff’s home. They recharged the R-22 refrigerant (“R-22”)[5] and said the heat strips melted and would need to be replaced.
Within a few hours, the heater quit working again.
Plaintiff did not run the heater until after the R-22 was recharged on April 10. When the R-22 was gone within hours, plaintiff did not run it again.
The Hammett’s were travelling to California for a week to get dental implants for the Plaintiff. So, Hammett thought they would only need to be in freezing temperatures with a space heater for a couple days and that Nicholson would fix the HVAC upon their return.
On April 23 at 8 a.m., a Nicholson employee called the plaintiff and said the part was on order, but “a challenge to find.” Further, the Nicholson employee told the plaintiff they would call her with an ETA when they knew more.
On April 24, Jason from Defendant Nicholson called the plaintiff and left a voice mail that the parts were ordered from the manufacturer, York, and he would call when they came in.
About May 4, a Nicholson employee called the plaintiff and set an appointment to install the parts on Monday, May 7.
On May 7, a woman from Nicholson called the plaintiff and said the wrong parts were sent and they would reschedule when the right parts came in. The plaintiff expressed concern because the HVAC made lots of noise, even though it was not on. The female representative at Nicholson said she would send a technician to listen to it that day.
A technician from Defendant Nicholson stopped by, listened to the unit and ensured the plaintiff that it was still safe to run it.
About May 25, the plaintiff called Defendant FAHW to report a toilet was running.
It was extremely hot and humid but the air conditioner kept “freezing”. It would not work. While Plaintiff was on the call in regards to the toilet, she inquired when the HVAC parts would be available.
Defendant FAHW employees supposedly looked into the situation. They concocted this story: They said the unit was fixed on April 10 and the job was “completed”. They said Nicholson stopped by on May 7 to listen to the noise.
The written communication log was later altered to delete the event of dispatch on May 7.
The record was also altered to reflect Nicholson scheduled their first visit for April 9 between 2-4 p.m.
The reason the date was important to FAHW is that if they had a valid contract, which they did not, then they would be required to make the first visit within 48 hours of the claim call.
Insisting the first visit was on April 9 is an example of the maliciousness with which FAHW and Nicholson acted.
The problem was logged as being a second complaint and a “pre-existing condition” as of May 25.
Two Nicholson employees told the plaintiff that Defendant FAHW convinced Nicholson to make the fraudulent entry on the project log.
On May 25, FAHW said they would find out what was happening and get back to Hammett.
The Plumber, Max Air, came to the Gold Lake house on May 26 and fixed the toilet. Hammett paid Max Air $75 as a service fee directly at the end of the visit.
FAHW did not contact Hammett about the HVAC. So on or about May 30, Hammett called FAHW.
Hammett spoke to a representative who called himself Frankie Fernandez.
Mr. Fernandez apologized for the fact that a service provider was not dispatched after the May 25th call. He said FAHW should not have acted that way; authorized Hammett to purchase a $150 room air-conditioner; and promised a service provider would be dispatched after the long Memorial Day weekend.
Mr. Fernandez specified that Hammett should not talk directly to the service provider about scheduling but should only discuss schedule with FAHW.
Hammett did not buy the $150 room air-conditioner. Primarily, the house has a very open floorplan and floor to ceiling windows across most of the length of the house. A room air-conditioner would cost more than $150 and still would be horribly inefficient, probably useless. Hammett may have gone to a mountain home she owned for the weekend, because the small rural community holds “Hill-Billy Daze” that weekend and the Air-conditioner in that home worked.
On May 31, having not heard from FAHW since the 25th, Hammett called FAHW again. A woman calling herself Yvonne Martinez (“Martinez”) told Hammett there was no Frankie Fernandez working there and Martinez would be handling the case.
On June 1, FAHW sent a text to Hammett that said a contractor has been assigned to her request.
On June 4, FAHW sent a text to Hammett that said a service appointment with SmartCool was scheduled for June 5 and a technician would arrive between 8:00 a.m. and 5 p.m. CDT.
Hammett scheduled with FAHW to send a contractor to her home on three more days, June 5, 7 and 8. FAHW instructed Hammett to keep the HVAC off until the technician arrived. (FAHW made the decision not to send a technician on June 6; Hammett would have stayed home with the air-conditioner off that day as well if they had.)
A FAHW employee told Hammett that the only HVAC contractors they used in Conway were SmartCool and Nicholson, so Hammett reluctantly agreed to SmartCool.
That there was no other HVAC contractor available was another lie. When FAHW realized Plaintiff was hiring an outside contractor and suing them, they tried to have MaxAir out to Hammett’s home. Plaintiff believes Max Air was not complicit to the fraud practiced by the Defendants. But Plaintiff had already waited double a reasonable time to have the problem fixed and been lied to bold faced and seen FAHW and Nicholson commit fraud, and did not agree to give FAHW any more chances.
Each day, the plaintiff stayed at home, with the air conditioner off, even though it could cool the house to 81 degrees when on and waited.
All three days the contractor, Defendant SmartCool cancelled after plaintiff called to see where they were.
On at least June 7 and June 8, Martinez was errantly sending the emails meant for SmartCool to a disinterested contractor with a similar email address to SmartCool. Hammett copied her emails to this disinterested party also, thinking it was SmartCool because Martinez used that email address.
Finally, exhausted, tired of being lied to, worried about the health issues involved in staying in a hot, humid house, and tired of losing money and opportunities to work on her businesses, Plaintiff reached out to Home Depot.
Plaintiff paid for the replacement of her unit with her own savings and is now forced to litigate to be reimbursed properly by First American.
On June 12, FAHW authorized Hammett to go to the contractor of her choosing and after Hammett paid them FAHW would reimburse One hundred and twenty-five dollars ($125.00). FAHW would consider paying more, they said.
Hammett did not agree to this pittance.
On June 15 after receiving the proposal to replace or repair from the Home Depot contractor, FAHW wrote that replacement of the entire system was not authorized.
The contractor wrote on the proposal “Leak in evaporator coil//will not be able to fix//must replace”.
FAHW interpreted this to mean they could not fix the coil so must replace the coil only.
FAHW wrote “[n]eed to know the following:
Why is the coil not repairable?
Why is replacement needed?
First American will not replace the entire system for the coil that has the only failure present.
Price would be needed for 1. Coil & labor and or 2. Indoor unit & Labor”
FAHW’s contractors tried to obtain heat strips for over two months, and then FAHW claimed that only the coil would need to be repaired or replaced.
During the period the house was 81 degrees or hotter, Plaintiff took proper precautions. She ran the fans in the house. She drank plenty of water. She cut back on physical activity, especially her daily yoga practice and daily hour-long walk.
Prior to this period, Plaintiff was an advanced student of yoga. She could balance on her hands with her legs in the air out to the side cross legged; she could do plow position with ease (plow is a forward fold but done in a supine position with legs folded at the hips back over the torso); she could sit in full lotus and forward fold in full lotus; she could do a Bird of Paradise standing balance with her arms and legs bound through each other. She also wore a loose size 10 jeans and climbed the Manitou, Colorado mile high staircase just a year earlier.
During the time Hammett lived without proper heat and air conditioning, she suffered physically quite a bit.
Hammett documented in emails to FAHW that she was sick and exhausted from the heat. She said she had to take naps during her usual work hours and slept all weekend.
Hammett could not do yoga in the hot, humid house.
Normally, walking would be uncomfortable in the heat, but Hammett knew she would be able to get her core temperature down when she was relaxing in the house afterwards. Not so while she had no air conditioning.
Hammett had just moved into the house and wanted to scrub down all the surfaces just to make sure there were no viruses lingering. She planned to pull up the old carpet in the bedroom downstairs and paint the concrete, but it was too hot. So, she lived with the residual from past inhabitants. (The old musty smelling carpet is still in one section of the downstairs bedroom because Plaintiff is unable to do the physical labor of removing it and her husband is busy working on other people’s homes to support Plaintiff. Gratefully the main part of the bedroom was stripped and painted before it got too hot.)
The upstairs is Plaintiff’s office and yoga room. The Hammetts call it “Laura’s She-shed”. Plaintiff could not use the upstairs at all for a couple weeks because it was stifling hot. She had that carpet professionally removed and new carpet installed because it is such an important space to Plaintiff and the heat combined with any organisms in the carpet could be quite unhealthful.
Hammett was a pattern day trader in the equities market. This takes passionate concentration, which is difficult while one is suffering from heat-exhaustion.
Weight started creeping on to Hammett’s 50 something year old body.
The Hammetts are usually affectionate, cuddling all the time they are together. But they could not even hold hands while disgustingly sweaty. This made Hammett sad.
The HVAC was replaced on June 20.
The evening Plaintiff finally replaced her air-conditioning, she and Mike Hammett made love. Toward the end, he pushed her legs back into plow, as normal for them, and Plaintiff suffered excruciating pain through her lumbar region.
Hammett’s muscles had tightened up during the period of forced inactivity. But for this forced inactivity and prolonged exposure to heat indexes over 100 degrees, Hammett would not be injured doing her customary activity. Before the forced lack of yoga practice, Plaintiff could normally be in that position as easily as most people stand or sit in a chair, with no pain whatsoever. She loved the stretch she felt in that position.
In the case of Lee v. Louisiana Bd. of Trustees for State Colleges, 2016 WL 9460653, District Court of Louisiana, Nineteenth Judicial District, Parish of East Baton Rouge, a jury awarded $2,529,229 to a young athlete who was forced to run 4 miles in the same type heat conditions FAHW subjected the Hammetts to live in for several weeks.
Hammett could probably have gotten away with a lie if she said the injury occurred while cleaning the house, but Hammett tries to be completely honest. Hammett’s delay in filing this complaint is partially due to the embarrassment of publication of such a private fact.
Mike Hammett suffered equally with Laura, working at a construction job, then coming home to unbearable heat. Plaintiff was anguished to think Mike Hammett was suffering physically to be able to spend time with her.
Plaintiff visited a licensed massage therapist (LMT) about six times. It seemed to help give Plaintiff some comfort and healing. But the LMT moved her office location, so Plaintiff tried several others.
Finally, Plaintiff found a chiropractor in Little Rock who advertised that she specialized in sport injuries. Plaintiff went to her, Elite Chiropractic, for about five adjustments. It was helpful, but quite a distance from Plaintiff’s home.
Plaintiff has now found a chiropractor in Conway, Owen’s Chiropractic. Dr. Owens and the three LMTs who work in her office are all healing, caring, intelligent people. Twice per week visits alternating massage with chiropractic adjustment and other modalities seems to be relieving some of the pain in Plaintiff’s back and left hip.
She is still unable to fix properties, which entails bending, lifting and stretching.
Plaintiff now wears a size 15-17 juniors. She can walk and fish, but she has limited range of motion compared to pre-injury and is not able to lift.
Plaintiff is unable to perform household chores such as squatting down to sweep dirt into a dustpan. Plaintiff is just now able to lift her computer off the floor without excruciating pain. Plaintiff must sit down to put her pants on. She could surf and she could stand in a yoga tree position with her leg extended toward the sky at 45 degrees, hand hanging on to her foot before the injury accident caused by the Defendants. Putting her pants on standing up was easy.
During the time without air-conditioning, Plaintiff was unable to work on restoring the Avilla Heights house. She was occupied waiting for the HVAC guys to come to her Gold Lake house instead. Then she was injured perhaps permanently.
Because the Avilla Heights house was bought in foreclosure and an inspection could not be made, Plaintiff did not buy a home warranty on that house. She intended to do most of the work to restore the house herself, literally.
Instead, she partnered with another couple to do some of the work, but the work of fixing a house was too complex and demanding for them without Hammett there to guide them. Plaintiff shelved the project until her injuries healed.
Mike Hammett was retiring from construction to become a professional tournament bass fisherman. Because tournaments were cancelled due to the coronavirus, he returned to construction. Laura Hammett agreed to a joint venture on the Avilla Heights house with him. Because Arkansas is a common law marriage state, Laura Hammett is losing half the potential profit on the project technically.
Plaintiff’s income is not uniform. She does not work on salary. Most of her income is from investments, mostly real estate, and is not realized on a bi-weekly basis, like a normal person.
Plaintiff had a net worth over a million dollars on March 30, 2018 when she closed escrow on the Gold Lake House and planned to enjoy fishing with Mike, hiking, yoga and fixing houses up, a semi-retirement.
God seems to have other plans for Hammett.
In 2018 and 2019 Hammett made no improvements on investment properties and she still has not finished the Avilla Heights house.
Plaintiff was blessed with an aptitude for law and has been a successful crusader for justice for children and against corrupt attorneys and judges in California. (The main reasons Plaintiff made Arkansas her state of citizenship was for the amazing government, the freedom of religion, and that the people are all hard working and get along with each other, unlike California.)
Plaintiff believes the defendants should pay for her to retrain out of construction by paying all the expenses of law school at Bowman. Alternatively, to set up scholarships for Plaintiff’s son and granddaughter to study to become doctors like Plaintiff’s father who passed away.
In the time between purchasing the policy from Defendant FAHW, instead of from a reputable company, and discovering that Defendant FAHW had no intention of replacing the HVAC, Plaintiff’s dishwasher broke down. The repair or replacement would have been covered by a reputable home warranty policy company if Plaintiff were not fraudulently induced to buy from Defendant First American Home Warranty.
Violations of the Arkansas Service Contracts Act
FAHW is in violation of Arkansas Code §4-114-107(a)(2)(B) and (b) as discussed in the paragraphs above and below, in particular:
Ark. Code §4-114-107 (a)(2)(B). “A company shall not use a name deceptively similar to the name or description of any insurance or surety corporation or any other provider unless it was using any of the prohibited language in its name prior to October 1, 2007. However a company using the prohibited language in its name prior to October 1, 2007 shall conspicuously disclose in its service contracts that the service contract is not an insurance contract.”
First American Home Warranty is considered an insurance company in some states such as its home state of California. The code does not specify that the similarly named insurance company must be doing business in Arkansas.
Also, First American Home Warranty is similar in name to its sister company, First American Title Insurance. The logos and colors are identical.
FAHW calls itself just “First American” often, such as on the cover of the contract where it says “A Home Warranty Service From First American”.
FAHW does not disclose in its service contract that it is not an insurance company.
Hammett wrote the word “insurance” several times while discussing the claim with FAHW. Hammett filed a complaint with the Department of Insurance. This would suggest that Hammett was deceived by FAHW that it was an insurance company. And Hammett is fairly sophisticated, having been a real estate broker and teaching herself enough law to prevail in 100% of the civil cases that have been decided. Imagine how much more so the average citizen would be deceived.
Arkansas Code § 4-114-107 (b) states: “A provider or its representative shall not in its service contracts or literature make or permit or cause to be made any false or misleading statement or deliberately omit any material statement that would be considered misleading if omitted in connection with the sale, offer to sell, or advertisement of a service contract.”
On the Contract cover stating under a happy house that looks like the letter “A”, “little peace of mind”. It is true that FAHW offers little peace of mind, as in no peace of mind, but they try to convey that they offer “A little peace of mind”.
On page 2, “ – and you are now protected against unforeseen system and appliance breakdowns.” (italics theirs)
It might be argued that the customer foresees all the system and appliance breakdowns that may occur, or they would not buy a home warranty. But the idea that comes across is the common usage of the word unforeseen, that the problems did not present to the customer before purchasing the insurance.
On page 2, “First American Home Warranty is here to offer you peace of mind when covered breakdowns occur and to provide you with quality service when you need us the most.”
A quick look at the internet shows that the majority of customers who write a comment think the service was the worst possible. There are several class action lawsuits filed against FAHW, but the plaintiffs consistently fail to attain class certification.
In contradiction to the statement about being protected against unforeseen breakdowns, FAHW wrote mid-paragraph two on page four that “[i]tems are not covered unless they are in safe working order at the start of coverage.” Then a couple sentences later it states “[t]his Contract provides coverage for unknown defects if the defect is not detectable through visual inspection or simple mechanical test (excluding renewal and non-real estate transaction customers).” These two statements are contradictory.
Advertising literature for FAHW says “If we can’t repair it, we’ll replace it.”
“Request service 24 hours a day, 365 days a year”, but omits the fact that the customer will often wait two days or two months for a service provider to show up.
“Avoid huge, inconvenient, expenses.” (sic)
“Homeowners depend on their HVAC system to keep their homes cool and comfy in summer. Find out how your clients can benefit from First American’s big HVAC coverage.”
All these statements are misleading.
Worse FAHW omits that the customer has a right to rescind instead of cancelling the contract. Most people would not know the difference between the terms, but they would know the difference behind the concepts. Plaintiff had some experience with rescission, yet when she wanted to rescind the Contract with FAHW, she followed their leading use of the word “cancel”.
On the First Cause of Action for Fraudulent Inducement to Contract
(Against Defendant FAHW)
Plaintiff incorporates by reference the paragraphs above and below and in particularity in the section on fraud below as though fully set forth herein.
Defendant FAHW through fraudulent marketing and advertising promised that if Plaintiff purchased her home warranty policy from them, as opposed to any other home warranty company, they would repair or replace a covered HVAC timely. This was a false representation.
Defendant FAHW knew the representations were false or knew that they did not have sufficient knowledge to make the representation. Plaintiff will show at trial that it is common practice for FAHW to refuse to provide the services they advertise.
FAHW does not make a home inspection before selling their policy. They do not require buyers to provide an inspection report and in this case, they did not accept the inspection made by buyer or the seller’s disclosure statement when there was a covered malfunction claimed.
FAHW does not give the buyer a copy of the adhesion contract prior to close of escrow when the contracted service is purchased.
FAHW intended that the plaintiff would rely on the representation made in their marketing and advertising.
Plaintiff, relying justifiably on Defendant FAHW’s representations, purchased her home warranty policy from Defendant FAHW, refraining from purchasing from another company.
Because of Plaintiff’s reliance on defendant’s promise, Plaintiff did not buy from a different company and get replacement or repair of her covered unit from a reputable home warranty company.
Defendant FAHW should be required to pay the full cost of replacing the HVAC unit and dishwasher.
On the Second Cause of Action for Rescission
(against FAHW)
Plaintiff incorporates by reference the paragraphs above and below as though fully set forth herein.
In order for a contract to exist, there must be: (a) competent parties, (b) subject matter, (c) legal consideration, (d) mutual agreement, and (e) mutual obligations.
Hammett never agreed to all the terms of the Contract; there was no mutual agreement.
Hammett first conveyed her disagreement with the contract to FAHW on April 9, 2018.
A glaring fault in the contract written by attorneys for FAHW and provided to customers who may not be attorneys as an adhesion contract is that the contract purports to allow for cancellation but not recission.
If the customer, like Hammett, disagrees with the contract, there is no meeting of the minds and no contract exists.
FAHW then insists that customers who object timely to the contract are still obligated to perform according to the contract, such as using binding arbitration.
Hammett did not use the proper language, but her intent was clear. She wanted to rescind the contract if FAHW had any reason they were not going to repair or replace the HVAC.
Hammett offered to restore FAHW by relieving it of any obligation to fix any breakdowns that occurred after the rescission on April 9, 2018. FAHW could keep the “processing fee” on Gold Lake house as it had on the NLR house, to cover any expense for answering the one phone call on April 8.
The breakdown that occurred before the recission would be the liability of FAHW not by contract but by fraudulent inducement. Because Hammett would not be able to purchase a home warranty from a reputable company to cover the now broken HVAC, she would not be whole if FAHW was able to get away with the fraudulent inducement.
FAHW decided not to “cancel” the contract and instead pretended they would repair or replace Hammett’s HVAC.
On the Third Cause of Action for Promissory Estoppel
Defendant FAHW promised to repair or replace the Plaintiff’s HVAC on April 9, 2018 after receiving the rescission email from Plaintiff.
FAHW knew Hammett did not agree with the adhesion contract, particularly at page 12, Limits of Liability section 4 because Hammett told them verbally and in writing.
FAHW knew Hammett wanted to rescind the contract if they were not going to fix or replace the HVAC for any reason.
FAHW continued to promise to have contractors come out to the property, then break those promises.
A quasi contractual promise was formed in which FAHW kept the policy fee as consideration and agreed to repair or replace the HVAC without the objectionable clauses of the policy.
Defendant FAHW should have reasonably expected the plaintiff to refrain from repairing or replacing her HVAC on her own in reliance on the promise.
Defendant SmartCool promised to come to the property to inspect and fix the HVAC on April 8, 2018, June 5, 7 and 8.
SmartCool had the expectation they would be paid $75 from the Plaintiff after making the service call and the rest from FAHW for the service.
SmartCool typically performed service for FAHW warranty holders and then was paid by FAHW or what it could convince the customer to pay for “uncovered” repairs and replacement.
SmartCool did not perform. They never came to the Gold Lake house.
Defendant Nicholson told Hammett they were obtaining parts to fix the unit on April 10 before leaving the Gold Lake Club House.
Nicholson employee Jason left a voice mail saying he was waiting on parts on April 24.
A Nicholson employee told Plaintiff on May 4 that parts were in and a technician would come to the Gold Lake Club House on May 7.
On May 7 a female Nicholson employee told Plaintiff the wrong part was delivered, and they would call when the right part came in.
Defendants Nicholson and FAHW did not contact Hammett when they learned the parts were not available.
Plaintiff called York, the manufacturer in mid-June and was told the part was no longer available.
All defendants should have reasonably expected Plaintiff to wait for them to fix the HVAC.
Nicholson diagnosed the HVAC as having a R-22 leak.
If FAHW did not know about the R-22 leak it was the fault of their own contractor and not following their own policies.
SmartCool knew there was a potential and probable R-22 leak in the Gold Lake house system.
R-22 leaks get worse over time and should be taken care of as soon as possible.
R-22 leaks negatively affect an AC system’s efficiency and overall performance. And they can also lead to negative effects on human health.
Inhaling R-22 can have lethal consequences and can be hazardous to the environment if it escapes.
A R-22 leak inside a home is toxic for the inhabitants and should be taken care of as soon as possible.
In fact Section 608 of the Clean Air Act prohibits individuals from intentionally or knowingly venting ozone-depleting substances, such as the chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons (HCFCs) commonly found in R-22.[6]
Yet the Defendants caused the Plaintiff to put off correcting the known leak for over two months and would have caused this indefinitely until the Plaintiff finally paid for the correction out of her own pocket.
On three days when there was extreme heat FAHW told Hammett to stay home with the air-conditioner off to wait for SmartCool to come at least diagnose the problem.
SmartCool knew they were expected at the Gold Lake house and never showed up.
On June 5, a SmartCool technician called Hammett’s phone three times in three minutes from a phone number that Hammett was not familiar with. FAHW employee Frankie Fernandez had already told Plaintiff all scheduling communications would go through FAHW. Yet, when Hammett did not answer the technician’s calls immediately, SmartCool claimed the technician had already drove out of the area and could not return until June 7.
Plaintiff was clear that if the HVAC was not going to be replaced or repaired by FAHW’s contractor, that she would purchase a unit from a third party contractor and expect reimbursement.
Defendants should have reasonably expected Hammett to stay home on those days without air-conditioning.
Instead of admitting to their negligent or intentional lack of communication with Hammett when they learned parts were not available, the defendants FAHW and Nicholson altered business documents and made false claims that the HVAC was already fixed and there was a second claim. The Defendants conspired to claim the damage was pre-existing.
The Defendants acted with reckless disregard for the health and safety of the plaintiff.
The plaintiff stayed home without heat or air-conditioning for at least four days and many more with impaired air-conditioning, causing discomfort, heat exhaustion, a resulting injury that may be permanent, diminished performance at equity investing and total disability to restore buildings.
During the almost two months of impaired HVAC in her home Hammett suffered inability to do her daily yoga practice, leading to a loss of mobility and range of motion, and ultimately to an acute injury to her lumbar region when she tried to partake in customary activity; inability to concentrate properly for her intense work day-trading; a period of loss of use of her upstairs which was so oppressively hot no one could stand in there more than a minute; a period of loss of the physical affection of her fiancé whom she married in April 2019.
The loss of affection is not a loss of conjugal relations, which would require that the Hammetts were already married when the injury occurred. It is not her partner’s body that is impaired. It is her own.
Laura Hammett likes physical affection as much as doing yoga, hiking and other athletics. All these pass-times were taken from Hammett by the defendants’ negligence, fraud and broken promises.
Injustice can be avoided only by enforcement of the promise, holding Defendants liable for collateral damage caused while they refused to fulfill their promise.
As of this writing, FAHW has not offered to reimburse Plaintiff the $8,668.84 or any amount, not even the $125 promised for the HVAC without extorting a full release of all the other claims and giving complete confidentiality. If FAHW was an insurance company, their actions would be considered “bad faith”.
On the Fourth Cause of Action for Outrage
(Against FAHW and Nicholson)
Plaintiff incorporates by reference the paragraphs above and below as though fully set forth herein.
FAHW and Nicholson conspired to alter business records to be able to thwart their customer Hammett’s pursuit of justice.
FAHW made fraudulent statements meant to and which did deter the Department of Insurance and Office of Attorney General from advocating against FAHW.
FAHW did not cancel or rescind the Contract and refund Plaintiff’s premium because FAHW and Nicholson intended to bilk the Plaintiff of even more money.
Evidence will be presented at trial that FAHW with its contractors customarily would deny claims and the contractors would convince the customers to spend significant sums on replacing and repairing out of their own pocket. It was a bait and switch scheme that allowed FAHW to underpay the contractors and still allow the contractors to reel in the profits. The Defendants could not cut their customers loose or they would lose the “big fish”.
FAHW said they would dispatch a contractor on the morning of April 8 who would arrive that freezing day to repair or replace the HVAC. They did not.
SmartCool confirmed they would be making a visit to the Gold Lake house on April 8. They did not.
Nicholson came to the Gold Lake house for the first time on April 10. The work order between FAHW and Nicholson specifies in bold capitals that the service was to be done on April 9. No record of the visit was logged by the defendants.
Nicholson in its answer to the complaint filed June 17, 2020 ⁋14 states: ”The allegations contained within paragraph no. 62 of the Plaintiffs’ (sic) Complaint are denied. The date stated therein [April 10] is incorrect.” Nicholson did not come to the property on April 9 as FAHW claims. The first service call was April 10 or later. It was a morning time.
Nicholson sent an employee to listen to the HVAC on May 7 even though he had no parts available. This visit does not show on the Work Order Details between Nicholson and FAHW.
Ms. Martinez wrote in an email on June 8, 2018 that the last time Nicholson was out was May 7.
Further communications by counsel on behalf of FAHW deny the visit of May 7.
FAHW attorney R. Ryan Younger of the law office of Quattlebaum, Grooms & Tull wrote a letter on November 1, 2018 to the Arkansas Department of Insurance in response to a complaint lodged by Hammett. In the letter he told the following lies and deceit, including but not limited to, with an intent to deceive the Arkansas Department of Insurance so as not to pursue justice for Hammett and others similarly situated.
A. “[Hammett], moreover, has not alleged or suggested that First American has violated any statutes or regulations applicable to service contracts.”
The statement in the paragraph above is not true. Hammett did not give the statute numbers that were violated, but she did allege and suggest that FAHW violated the following statutes:
deceptively similar to the name or description of any insurance or surety corporation or any other provider unless it was using any of the prohibited language in its name prior to October 1, 2007. However, a company using the prohibited language in its name prior to October 1, 2007 shall conspicuously disclose in its service contracts that the service contract is not an insurance contract.
Hammett alleged and suggested all these statements in the Contract and literature were misleading.
B. “First American dispatched Nicholson’s Heating and Air Conditioning on April 9, 2018.” While not an outright lie, this was deceptive. First American uses the word dispatched as the day they contact the contractor, but the service call is made at a later date. Nicholson’s did not make the first visit until April 10, 2018.
C. “First American did not hear from [Hammett] again until May 29, 2018, when she advised that the job was incomplete because she was under the impression that parts were being ordered.”
Hammett called FAHW on April 30 and May 25, which communications are reflected in the “My Service Requests” log generated by FAHW. Hammett does not recall calling FAHW between May 25 on May 31, and has no emails or notes to confirm a call made during this period.
This was also deceptive because of the implication that the parts being on order was merely an impression and not the truth. In other words Mr. Younger should have written “First American did not hear from [Hammett] again until April 30, 2018, when she advised that the job was incomplete because parts were ordered but the right parts never arrived.”
D. “On June 1, 2018, [Hammett] placed a new claim relating to her air conditioner.” June 1, 2018 was not a new claim. The parts were ordered but never obtained or installed on the claim of April 8.
E. “On June 5, 2018, SmartCool advised First American that it contacted [Hammett] on three separate occasions but was unsuccessful in reaching her.” This is technically not an outright lie, but deceitful.
A SmartCool technician called Hammett three times at 12:04, 12:05 and 12:06. He left no voicemail
Hammett had waited since 8 a.m. and was hot and disgustingly sweaty. She figured the technician was on lunch at noon and had taken a shower. Then she quickly went back to her work day-trading.
When she saw the missed calls from the technician David and Mike Hammett, who called within minutes of the technician, she returned the calls immediately. At 1:06 she called the technician, who did not answer his phone.
At 1:09 Hammett called SmartCool, whose representative told Hammett the technician already left the area and could not make the service call that day.
F. “On June 7, 2018, SmartCool advised First American that it tried contacting [Hammett] to confirm the appointment but was unable to reach her.”
Hammett’s phone records show no call, missed or completed, from SmartCool on June 6 or 7. There was quite a bit of finger pointing by both SmartCool and FAHW, but no matter who made up the lie, Mr. Younger knew it was a lie and should have not obstructed justice.
G. “An attempt was made to reschedule for June 8, 2018, but [Hammett] declined.”
On June 7, 2018 at 4:23 PM CDT, Hammett sent an email to FAHW confirming the June 8 appointment and emphatically stating the contractor should show up.
H. “On June 12, 2018, First American offered [Hammett] up to $200.00 to hire a licensed and bonded contractor to diagnose failures to her air conditioning system.”
The offer on June 12 was for $200 less $75 to hire a licensed and bonded contractor to repair or replace the HVAC. That is $125 to diagnose, repair and replace the unit.
I. “On June 20, 2018, First American learned from Nicholson’s that, when it provided service in April, it found the Freon was low, the heat strips were melted together, and it ordered parts.
First American learned these things from Nicholson’s on or before May 25, 2018.
J. Mr. Younger implies that the decision that the HVAC was not in “safe working order” came on or after June 20, 2018. Plaintiff printed out an internal work order on June 8, 2018 that said the heat strips were melted inter alia.
K. “First American’s claims decisions and handling have been based on the service contract purchase by [Hammett], and First American stands by them.”
FAHW denies legitimate claims as standard policy.
FAHW attorney R. Ryan Younger of the law office of Quattlebaum, Grooms & Tull wrote a letter on April 5, 2019 to the Office of the Arkansas Attorney General in response to a complaint lodged by Hammett. In the letter he told the following lies and deceit, including but not limited to, with an intent to deceive the Attorney General so as not to pursue justice for Hammett and others similarly situated.
A. “First American dispatched Nicholson’s Heating and Air Conditioning on April 9, 2018.” While not an outright lie, this was deceptive. First American uses the word dispatched as the day they contact the contractor, but the service call is made at a later date. Nicholson’s did not make the first visit until April 10.
B. “First American did not hear from [Hammett] again until May 29, 2018, when she advised that the job was incomplete because she was under the impression that parts were being ordered.”
Hammett called FAHW on April 30 and May 25, which communications are reflected in the “My Service Requests” log generated by FAHW.
This was also deceptive because of the implication that the parts being on order was merely an impression and not the truth.
C. “On June 1, 2018, [Hammett] placed a new claim relating to her air conditioner.” June 1, 2018 was not a new claim. The parts were ordered but never obtained or installed on the claim of April 8.
D. “On June 5, 2018, SmartCool advised First American that it contacted [Hammett] on three separate occasions but was unsuccessful in reaching her.” This is technically not an outright lie, but deceitful.
A SmartCool technician called Hammett three times at 12:04, 12:05 and 12:06. He left no voicemail
Hammett had waited since 8 a.m. and was hot and disgustingly sweaty. She figured the technician was on lunch at noon and had taken a shower. Then she quickly went back to her work day-trading.
When she saw the missed calls from the technician David and Mike Hammett, who called within minutes of the technician, she returned the calls immediately. At 1:06 she called the technician, who did not answer his phone.
At 1:09 Hammett called SmartCool, whose representative told Hammett the technician already left the area and could not make the service call that day.
E. “On June 7, 2018, SmartCool advised First American that it tried contacting [Hammett] to confirm the appointment but was unable to reach her.”
Hammett’s phone records show no call, missed or completed, from SmartCool on June 6 or 7. There was quite a bit of finger pointing by both SmartCool and FAHW, but no matter who made up the lie, Mr. Younger knew it was a lie and should have honest.
F. “An attempt was made to reschedule for June 8, 2018, but [Hammett] declined.”
On June 7, 2018 at 4:23 PM CDT, Hammett sent an email to FAHW confirming the June 8 appointment and emphatically stating the contractor should show up.
G. “On June 12, 2018, First American offered [Hammett] up to $200.00 to hire a licensed and bonded contractor to diagnose failures to her air conditioning system.”
The offer on June 12 was for $200 less $75 to hire a licensed and bonded contractor to repair or replace the HVAC. That is $125 to diagnose, repair and replace the unit, not $200 to diagnose.
H. “On June 20, 2018, First American learned from Nicholson’s that, when it provided service in April, it found the Freon was low, the heat strips were melted together, and it ordered parts.
First American learned these things from Nicholson’s on or before May 25, 2018. [7]
I. Mr. Younger implies that the decision that the HVAC was not in “safe working order” came on or after June 20, 2018. Plaintiff printed out an internal work order on June 8, 2018 that said the heat strips were melted inter alia.
J. “First American’s claims decisions and handling have been based on the service contract purchase by [Hammett], and First American stands by them.”
FAHW denies legitimate claims as standard policy.
K. “First American nevertheless has attempted to resolve this matter in a reasonable fashion, but [Hammett] has demanded millions of dollars.”
“Reasonable” is subjective and needs to be determined by a jury. The highest offer made by FAHW was $8,668.48 paid to Hammett, but only at the cost of complete confidentiality, and dismissal of any other claims such as but not limited to personal injury, mental anguish, punitive damages, and fraud.
Hammett offered to rescind the contract on April 9, 2019 (though the layperson plaintiff used the word “cancel”). In that case she would have accepted the cost or repair or replacement and had her HVAC replaced as soon as it was discovered that parts are no longer available.
Hammett later offered to settle for millions put into a fund to help other homeowners and renters who were having problems with issues in their homes and no coverage.
The letter of April 5, 2019 was in response to Hammett’s attempts to have the People of the State of Arkansas receive the bulk of the settlement. Technically, Hammett was asking for millions, but FAHW left out that the millions would not be paid to Hammett.
FAHW advertises that they give the customer “peace of mind”. The home warranty company should realize that the stressful situation they put Hammett in would cause the opposite of peace of mind- severe emotional distress.
FAHW should and did realize leaving someone without heat for more than 24 hours when temperatures were below freezing may cause them to fall ill and would cause deep self-concern that they would fall ill or even freeze to death.
FAHW should have known that leaving a person without air-conditioning for weeks at a time while the heat index was over 100 degrees might cause heat exhaustion and maybe even death.
Plaintiff had to worry about herself and Mike Hammett, the love of her life.
The defendants’ conduct was extreme, outrageous, and utterly intolerable in a civilized community.
FAHW employees conspired with each other and with Nicholson to alter business records and denied coverage based on fabricated “preexisting conditions”, and left plaintiff without heat and air for two months.
Nicholson knew FAHW was using a fabricated diagnosis to rationalize shirking their responsibilities.
Nicholson eventually knew parts were no longer available, but did not inform Hammett, leaving her without heat and air indefinitely.
On July 26, Nicholson said they would give testimony about the lies FAHW was telling if Plaintiff would pay them $200 an hour.
That was the last time a Nicholson employee spoke with Hammett. Apparently, Nicholson got a better offer from FAHW.
This was not an isolated incident. It is common practice for FAHW. The Executive Secretary of Arkansas Department of Health Bob Higginbottom was aware of a preponderance of complaints against HVAC contractors in Pine Bluff, where Nicholson and SmartCool are both located.
Plaintiff was extremely upset by FAHW’s actions. It is two years later, plaintiff’s back still aches and so she is constantly reminded of the unethical, maybe illegal, reckless actions of FAHW.
Whenever the weather starts getting hot, plaintiff is reminded of those physically miserable weeks in her new home when she could barely even hold Mike’s hand for the profuse sweating.
When the Hammetts have conjugal relations, they are appropriately careful of Laura’s back. But Laura still has a moment of panic when the couple is close to missionary position.
No reasonable person should be expected to endure this aggravation and distress, especially after paying for “peace of mind”.
Wherefore, Plaintiff prays for Remedies as herein set forth.
Equitable Relief for Statutory Violations
Plaintiff begs the Court to refer the statutory violations under the Service Contract Act to the Department of Insurance for Investigation and remediation;
Alternatively for declaratory relief that FAHW must a) present its contract to customers before the premium is paid, b) make it clear in big bold letters that “First American Home Warranty Corporation has the sole discretion to decide if conditions were preexisting and deny coverage based on their decision” and c) require a building inspection before issuing the policy which will be the sole basis of what conditions are preexisting;
Or any relief the Court finds appropriate.
On the First Cause of Action for Fraud in the Inducement Against First American Home Warranty Corporation:
For general damages in the amount of $8,668.89, the cost of replacing the HVAC, exclusive of interest minus $430 that would have been spent on a home warranty from a reputable company;
For the cost of a new dishwasher;
For costs of litigation;
For attorney fees;
And for such other relief as the Court deems appropriate.
On the Second Cause of Action for Rescission Against FAHW
For Recission of the Contract effective April 9, 2018.
Restitution of $430 to Hammett from FAHW for the cost of the premium. The $430 is returned to FAHW as part of the agreement formed through promissory estoppel.
FAHW dispatched contractors to the Gold Lake house for events unrelated to the HVAC on two occasions.
Once for a running toilet. Hammett paid more directly to the contractor than it would cost her to buy the part and ask Mike Hammett to replace it, but Hammett is willing to pay the price difference if it actually cost FAHW anything.
The second service call was for a cook top hood that did not turn on sometimes when the switch on the hood was flipped and that did not work well when it did come on.
Hammett paid the contractor $75 directly. He flipped a light switch across the room and the hood came on. Apparently, the hood was installed on a switched outlet. The contractor said the vent was working and left. The vent still does not work.
It is doubtful FAHW is owed anything for that call.
On the Third Cause of Action for Promissory Estoppel Against All Defendants Jointly and Severally
Compensatory nominal damages for loss of income in an amount to be determined by jury;
Compensatory damages to retrain Plaintiff or if better for public policy to train plaintiff’s son and granddaughter;
Compensatory damages for medical expenses in an amount to be determined at trial;
Compensatory damages for physical pain and suffering to be determined at trial;
Compensatory damages for emotional distress to be determined at trial;
For costs;
For attorney fees;
And for such other relief as the Court deems appropriate.
On the Fourth Cause of Action for Outrage Against FAHW and Nicholson Jointly and Severally
Punitive damages enough to deter FAHW, a Fortune 500 subsidiary from acting the same way toward other citizens of Arkansas and to let them know malice, the disregard for truth, and fraud will not be tolerated;
And to deter Nicholson likewise from altering documents to support fraud and refusing to come clean even after they knew they were caught.
And a Court referral to the Office of the Attorney General to take another look at potential fraud charges against the individuals who were not named as defendants in this complaint, but who committed fraud.
Plaintiff expects the aggregate damages to exceed $75,000.
I, Plaintiff Laura Hammett, state that the contents of the pleading above are true to my knowledge, except as to those matters stated on information and belief, and as to those matters, I believe them to be true.
Dated July 1, 2020 /s Laura Hammett
[1] The pro se plaintiff is a layperson and used the term “cancel” instead of “rescind”, but the intent is clear and will be discussed in depth in the section on rescission.
[2] FAHW was called First American Home Buyer’s Protection but the name changed when the parent company restructured.
[3] Case No. 09-CV-00775 was consolidated with 13-CV-01585, Carrera v. First American Buyer’s Protection Corporation and settled 3/30/2018 after 9 years of litigation. Class certification was denied at the District Court and the denial was affirmed by the Ninth Circuit Court of Appeals.
[4] Because it is so difficult to get class certification and their contract limits damages, FAHW has no incentive to change their malicious and dangerous behavior. The unique situation in this case, that the contract was rescinded, and a second agreement formed, gives Hammett the unique opportunity to hold FAHW accountable.
[5] R-22 is commonly called “Freon”, but Freon is a trade name, like Coke is to soda.
[6] R-22 was phased out for the safer R-410-A refrigerant, but units built prior to 2014 such as the one in Gold Lake house still required R-22.
[7] Even if FAHW learned that parts were not available on June 20, it had no intention of replacing the HVAC and is not excused from pretending it was considering replacing the HVAC instead of rescinding the contract. But it is unlikely that FAHW was told multiple times by Hammett that Nicholson said the parts were unavailable and FAHW did not confirm or deny that fact with Nicholson.
A Higher Law 