a Delaware limited liability company CK $ $ SUPERIOR COURT OF THE STATE OF v;.r1l,~ FOR THE COUNTY OF SANTA

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1 I t I I.., ti!ia '"t,. s. <S U! '" :I 0 PETER V. DESSAU, ESQ., SBN NO. FRANK J. PERRETTA, ESQ., SBN NO. GRANT H. BAKER, ESQ., SBN NO. MILLER, MORTN, CAILLAT & NEVIS, LLP Metro Drive, Floor San Jose, CA 0- r- r II '- ED ;Jd, f" - n,. 'lo.a - r d.( -'-:l. '" J t: n '"\!nljil0... ' I Telephone: (0) - Ji..i...!...i.j. "t'tp III FacsImile: (0) - David H. Yamasak i Chie f Executi \Ie Off c Attorneys for Plaintiff By: ssancayco DTSCl! THE IRVINE COMPANY LLC, R#D00iJi a Delaware limited liability company CK $0. 0 TL $0. r :. -CV- SUPERIOR COURT OF THE STATE OF v;.rl, FOR THE COUNTY OF SANTA THE IRVINE COMPANY LLC, a Delaware ) Case No. limited liability company, ) ) COMPLAINT FOR DAMAGES, BREACH Plaintiff, ) OF CONTRACT, BREACH OF EXPRESS ) WARRANTY, NEGLIGENCE; BREACH vs. lof WRITTEN CONTRACT BY TIDRD PARTY BENEFICIARY; AND BREACH OF SEGUE CONSTRUCTION, INC., a California EXPRESS INDEMNITY corporation; and DOES through 0, ) Defendants. Unlimited Civil Case (over $,000) ) PRELIMINARY ALLEGATIONS. Notwithstanding the allegations identified herein, Plaintiff THE IRVINE COMPANY LLC (hereinafter "IRVINE" or "Plaintiff') does not waive its right to have this matter submitted to binding arbitration, in accordance with the terms of its Prime Contract with SEGUE CONSTRUCTION, INC. (hereinafter "SEGUE"), or, in the alternative, judicial reference pursuant to California Code ofcivil Procedures sections, et seq.. Plaintiff IRVINE is a Delaware limited liability company authorized to do, and doing business in California and is the owner of the real property commonly known as THE PINES AT NORTH PARK APARTMENTS located in San Jose, California ("PINES"). The PINES is comprised oftwo parcels, Parcel Bland B. The allegations and claims identified herein pertain to

2 Parcel B only. The PINES, Parcel B, is legally described in Exhibit "A" which is attached hereto.; 0!a ;!u..& '- ;: tll. <S U I!l ri (the "Property").. Defendant SEGUE is a California corporation authorized to do, and is doing business in the State ofcalifornia.. Plaintiff is ignorant of the true names and capacities of Defendants sued herein as DOES through 0, inclusive, and therefore sues these Defendants by such fictitious names. Plaintiff prays leave. to amend this Complaint to allege their true names and capacities when the same have been ascertained.. Plaintiff is informed and believes, and thereon alleges that DOES through 0, are design professionals who were hired by Plaintiff or SEGUE to perform work at the Property including, but not limited to, architectural and other design and/or consulting services.. Plaintiff is informed and believes, and thereon alleges that DOES through 0, are subcontractors who were hired directly by SEGUE to perform work at the Property including, but not limited to, work at breezeways, private balconies and stairwells.. Plaintiff is informed and believes, and thereon alleges that DOES through, are third party or lower-tier subcontractors, hired by subcontractors who were hired directly by SEGUE, to perform work at the Property including, but not limited to, work at breezeways, private balconies and stairwells.. Plaintiff is informed and believes, and thereon alleges that DOES through 0, are third party or lower-tier subcontractors or design professionals, hired by design professionals who were hired by Plaintiff or SEGUE to perform work at the Property including, but not limited to, architectural, structural, civil and other design and/or consulting services.. Plaintiff is informed and believes, and thereon alleges that each of the Defendants sued herein is responsible in some manner for the occurrences herein alleged, and that Plaintiff's damages, as herein alleged, were legally caused by such Defendants.. Plaintiff is informed and believes, and thereon alleges that at all times herein mentioned each ofthe Defendants sued herein was the agent and employee of each of the remaining Defendants, and was, at all times, acting within the scope ofsuch agency and employment.

3 t J t <Ii!la >-" S! h lo 0 U ::I. On or around August, 000, IRVINE entered into an agreement with SEGUE (the "Prime Contract") whereby SEGUE agreed to construct on the Property a certain set of improvements more particularly described in the Prime Contract; specifically a multi-story apartment building (the "Project"). A true and correct copy of the Prime Contract is attached hereto as Exhibit "B".. After SEGUE and The Irvine Company entered into the Prime Contract, The Irvine Company transferred and assigned its rights under the Prime Contract to Irvine Commercial Development Company ("ICDC"), which later changed its name to Irvine Commercial Property Company and merged with and into IRVINE. By these assignments and mergers, IRVINE is the true legal entity having rights to enforce the Prime Contract.. Within the last three () years from the date of this Complaint, Plaintiff discovered that there were certain conditions at the Project resulting in water penetration causing tangible property damage at the Project. Specifically, Plaintiff is informed and believes, and based thereon alleges, that there are defects in the breezeways, private balconies and stairwells at the Project. FIRST CAUSE OF ACTION [Breach of Contract against Defendant SEGUE]. Plaintiff hereby re-alleges and incorporates by this reference each and every allegation contained in Paragraphs through of its Complaint, as though fully set forth herein.. Pursuant to Paragraph., of the Prime Contract, SEGUE agreed that it would be solely responsible for construction means, methods, techniques, sequences and procedures employed in connection with the work. SEGUE further agreed to be responsible for any failure by it or its subcontractors to carry out the work, including, without limitation, the construction of the breezeways, private balconies and stairwells at the Project, in accordance with the contract documents and all applicable laws, rules and regulations.. Plaintiff has fully performed all terms, conditions, covenants and promises required of it pursuant to the terms ofthe Prime Contract.. SEGUE breached the terms of the Prime Contract by, among other things, failing to construct the breezeways, private balconies and stairwells at the Project in substantial compliance

4 with the contract docwnents and all applicable local and state codes.!i 0 d {:II <S Ii j I. The Prime Contract contains an attorneys' fees clause.. As a proximate result ofdefendant's breach ofthe contract, as set forth above, Plaintiff has suffered damage in an amount to be shown according to proof at trial, but not limited to, the cost of repairing and replacing the defective materials and workmanship, testing and investigation of such defective materials and workmanship, lost rents and income, diminution of fair market value, and legal and professional costs, as well as other incidental and consequential damages. WHEREFORE, Plaintiff prays for judgment against Defendant as SECOND CAUSE OF ACTION [Breach ofcontract against DOES through 0, inclusive) 0. Plaintiff hereby re-alleges and incorporates by this reference each and every allegation contained in Paragraphs through ofits Complaint, as though fully set forth herein.. Plaintiff entered into various written agreements with Defendant DOES through 0 for the performance of certain design and/or consulting services in connection with the design, planning, surveying of the Project, including design and/or consulting services in connection with waterproofing of the breezeways, private balconies and stairwells on the Project (collectively "Design Contracts").. Pursuant to paragraphs. and. oftheir Design Contracts with IRVINE, Defendants DOES through 0 contracted to perform their services with professional skill and care.. Plaintiff has fully performed all terms, conditions, covenants and promises required of it pursuant to the terms ofthe Design Contracts.. DOES through 0, inclusive breached the terms of the Design Contracts by, among other things, failing to design the breezeways, private balconies and stairwells at the Project in substantial compliance with all applicable local and state codes and according to industry standard.. The Design Contracts contain attorneys' fees provisions.. As a proximate result of the Defendants' breach(es) of the contract, as set forth above, Plaintiff has suffered damage in an amount to be shown according to proof at trial, but not limited to, the cost of repairing and replacing the defective materials and workmanship, testing and

5 t. vi h d tll -!U IQ! Ii' ::Ii 0 investigation of such defective materials and workmanship, lost rents and income, diminution of fair market value, and legal and professional costs, as well as other incidental and consequential damages. WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as THIRD CAUSE OF ACTION [Breach of Express Warranties Against Defendant SEGUE]. Plaintiff hereby re-alleges and incorporates by this reference each and every allegation contained in Paragraphs through of its Complaint, as though fully set forth herein.. Pursuant to Paragraph.. ofthe Prime Contract, SEGUE warranted to Plaintiff "that all Work will be completed in accordance with the requirements of the Contract Documents (whether performed by Contractor or a Subcontractor) and will be of good workmanship and quality." SEGUE further warranted to Plaintiff "that the Work and all portions thereof (whether performed by Contractor or a Subcontractor) will be free from all defects in material and workmanship furnished in the Contract Documents for a period of one () year from the date of Final Completion.". SEGUE breached the warranty contained in Paragraph.. by, among other things, failing to construct the breezeways, private balconies and stairwells at the Project in a workmanlike manner and in a manner consistent with the Prime Contract. 0. The Prime Contract contains an attorneys' fees clause entitling any party enforcing any provision ofthe Agreement to recover reasonable attorneys' fees.. As a proximate result of Defendants' breach of contract, as set forth above, Plaintiff has suffered damage in an amount to be shown according to proof at trial, but not limited to, the cost of repairing and replacing the defective materials and workmanship, testing and investigation of such defective materials and workmanship, lost rents and income, diminution of fair market value, and legal and professional costs, as well as other incidental and consequential damages. II NEGLIGENCE, AND BREACH OF WRITTEN CONTRACT BY TIDRD PARTY BENEFICIARY

6 WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as FOURTH CAUSE OF ACTION d.,;!a d 0 i U ;!(I! [Negligence against Defendants SEGUE and DOES through 0, inclusive and through, inclusive]. Plaintiff hereby re-alleges and incorporates by this reference each and every allegation contained in P!lfagraphs through of its Complaint, as though fully set forth herein.. Plaintiff is informed and believes, and based thereon alleges that Defendant DOES through 0 entered into various agreements with SEGUE to perform certain works of improvement in connection with the construction of the Project including, without limitation, design services, consulting services, construction services and repair services in connection with the construction and waterproofing ofthe breezeways, private balconies and stairwells on the Project.. Plaintiff is informed and believes, and based thereon alleges that Defendant DOES through, inclusive entered into various agreements with DOES through 0, inclusive to actually perform certain works of improvement in connection with the construction of the Project including, without limitation, design services, consulting services, construction services and repair services in connection with the construction and waterproofing of the breezeways, private balconies and stairwells on the Project.. Plaintiff is informed and believes, and based thereon alleges, that the aforementioned services were performed in a negligent manner and that such services resulted in water penetration to the Project which has caused tangible property damage to elements ofthe Project.. As a proximate result of Defendants, and each of their, negligent conduct, Plaintiff has been damaged in an amount to be shown according to proof at trial, but not limited to, the cost of repairing and replacing the defective materials and workmanship, testing and investigation of such defective materials and workmanship, lost rents and income, diminution of fair market value, as well as other incidental and consequential damages. WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as

7 h d.! 0 IH g I FIFTH CAUSE OF ACTION [Negligence against Defendants DOES through 0, inclusive and through 0, inclusive]. Plaintiff hereby re-alleges and incorporates by this reference each and every allegation contained in Paragraphs through of its Complaint, as though fully set forth herein.. Plaintiff entered into various agreements with DOES through 0, inclusive for the performance of certain design and/or consulting services in connection with the design, planning, surveying of the Project, including design and/or consulting services in connection with waterproofing of the breezeways, private balconies and stairwells on the Project.. Plaintiff is informed and believes, and based thereon alleges that Defendant DOES through 0, inclusive entered into various agreements with DOES through 0, inclusive to perform design and/or consulting services in connection with the design, planning and surveying on the Project, including design and/or consulting services related to the waterproofing of the breezeways, private balconies and stairwells on the Project. 0. Plaintiff is informed and believes, and based thereon alleges, that the aforementioned services were performed in a negligent manner and that such services resulted in water penetration to the Project which has caused tangible property damage to elements of the Project.. As a proximate result of Defendants, and each of their, negligent conduct, Plaintiff has been damaged in an amount to be shown according to proof at trial, but not limited to, the cost of repairing and replacing the defective materials and workmanship, testing and investigation of such defective materials and workmanship, lost rents and income, diminution of fair market value, as well as other incidental and consequential damages, WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as SIXTH CAUSE OF ACTION [Breach of Written Contract by Third Party Beneficiary against DOES through SO, inclusive]. Plaintiff hereby re-alleges and incorporates by this reference each and every allegation contained in Paragraphs through of its Complaint, as though fully set forth herein.

8 . Plaintiff is infonned and believes, and thereon alleges, that Defendant SEGUE entered.. i!!i... " -i 0 -! U lq.! i into various written contracts with Defendants DOES through 0, inclusive to perfonn certain works of improvement in connection with construction of the Project including, without limitation, design services, consulting services, construction services and repair services in connection with the construction and waterproofing of the breezeways, private balconies and stairwells on the Project.. Plaintiff is infonned and believes, and thereon alleges, that Plaintiff was an intended third party beneficiary of those contracts entered into by and between Defendants.. Plaintiff is infonned and believes, and thereon alleges, that Defendants DOES through 0, inclusive breached the written contracts by, among other things, failing to construct the breezeways, private balconies and stairwells at the Project in a workmanlike manner and in a manner consistent with the Prime Contract.. As a proximate result of Defendants' breach of contract, as set forth above, Plaintiff has suffered damage in an amount to be shown according to proof at trial, but not limited to, the cost of repairing and replacing the defective materials and workmanship, testing and investigation of such defective materials and workmanship, lost rents and income, diminution of fair market value, and legal and professional costs, as well as other incidental and consequential damages. WHEREFORE, Plaintiff prays for judgment against Defendants, and each of them, as PRAYER For The First, Second, Third And Sixth Causes of Action:. For damages according to proof;. For fees and costs; For The Fourth & Fifth Cause of Action:. For damages according to proof; II / / /

9 , i For All Causes of Action:. For interest at the maximum legal rate; and. For such other and further relief as the Court deems just and proper. Dated: February $-,0 MILLER, MORTON, CAILLAT & NEVIS, LLP Attorneys for Plaintiff THE IRVINE COMPANY LLC, a Delaware limited liability company ::ODMA\GRPWISE\MMCN_SJDOMAIN.MMCN_SJPO.NewLitigationLibrary:..; 0!! I&.& t::.! U r.:! J