Judge Allows Moldy Home Lawsuit Against Home Builder D.R. Horton to Proceed in Louisiana Court

Homeowners Challenge Arbitration Clause Over Mold, Humidity Issues

BATON ROUGE, La. — A Louisiana couple can proceed with their lawsuit against one of the nation’s largest homebuilders after a judge ruled they are not bound by a disputed arbitration agreement.

On July 22, Judge Donald Johnson of the 19th Judicial District Court found that West and Alicia Dixon’s contracts with D.R. Horton were “not legally binding or enforceable,” clearing the way for their claims to be heard in state court. The ruling is a key development in the couple’s case, which centers on mold, humidity, and water intrusion problems allegedly caused by a faulty HVAC system in their Youngsville home.

D.R. Horton has argued for three years that the matter should be handled through private arbitration. The company says the couple’s signed contracts include clauses requiring legal disputes to go before an arbitrator, not a judge or jury.

But Johnson found that the contracts were flawed. The original agreement was printed poorly, with ink streaks and small, unreadable text. A revised version had a $4,000 price discrepancy and was not signed by a D.R. Horton representative. The judge said the contracts gave D.R. Horton broad exemptions and failed to clearly explain the arbitration process, including a lack of clarity about the American Arbitration Association rules.

Lawsuit Alleges Defective Homes Across Louisiana

The Dixons claim their home, built in Lafayette Parish, was not constructed to withstand Louisiana’s heat and humidity. Their attorneys argue that a defective HVAC system led to harmful mold growth and expensive moisture damage. They say D.R. Horton knowingly installed inadequate ventilation in homes to cut costs.

“The system is looking for air,” said attorney Lance Unglesby, who represents the Dixons. “Instead of getting cold air to recycle, it’s sucking that hot air into the house.”

Unglesby said D.R. Horton failed to install return air vents in master bedrooms, which would have helped maintain proper airflow. He believes the issue is widespread and plans to seek class-action certification. His team has conducted air quality tests in other homes built by D.R. Horton and found the same issue.

Builder Denies Allegations

D.R. Horton strongly denies wrongdoing. “We are committed to superior customer service and building quality homes and neighborhoods throughout Louisiana and across the United States,” said company spokesperson Bethany Carle. “We take homeowner concerns seriously.”

The builder has notified the court it will appeal Judge Johnson’s decision. Defense attorney James Alcee Brown argued the company will face “irreparable harm” if forced to proceed in court instead of arbitration. He is asking the First Circuit Court of Appeal to overturn the ruling.

Meanwhile, Unglesby is preparing to file for class-action status. He says internal company knowledge of the HVAC issue dates back years and that the builder continued to sell homes despite knowing about the defect.

Pending Appellate Review

The First Circuit Court of Appeal will now consider whether to overturn the lower court’s decision and enforce the arbitration clause. If the ruling stands, the Dixons’ case could serve as a test for similar complaints across the state.

Their attorneys say they are ready to prove that negative pressure caused by flawed HVAC systems has impacted hundreds, possibly thousands, of homes built by D.R. Horton along the I-10 corridor from Lake Charles to Slidell.