Risk Management Articles

"Toxic" Mold Part I: What Is It? What Causes It? And Why Do We Keep Hearing About It?!
By Dave Dolnick

Lawsuits over "toxic" mold are becoming as prevalent as mold itself. No one involved in constructing buildings with mold problems is safe from litigation. Contractors are often considered fair game, even when the fault lies wholly with the design-and even when the contractor builds exactly to spec.

In this three-part series, we will examine (Part I) what constitutes "toxic" mold and what causes it to grow; (Part II) what legal and financial risks "toxic" mold creates; and (Part III) what contractors can do to ensure that their insurance adequately covers those risks.


Before we look at "toxic" molds and the problems they cause, let's take an up-close look at mold (hold your nose if you like). Molds-members of the family of plants known as fungi-are everywhere in this country. In fact, they're almost everywhere in the world. Molds are in the air we breathe and all around us. They are the "bleu" in bleu cheese and Roquefort; they improve our wine, produce antibiotics, and are used in the food and beverage industry. They also help break down organic matter in the soil, and many fungi act as a part of nature's "trash crew," cleaning up dead or decaying material.

Molds contain no chlorophyll, so they don't photosynthesize like flowering plants or trees. They reproduce through spores, which can germinate wherever they find a food source (virtually any organic substance) and moisture. How much moisture varies by species, though all molds need some moisture to grow and reproduce. They meet all their nutritional needs from the substances they grow on, and they are very good at growing.


Despite the many harmless and beneficial molds, toxic molds do exist and can pose serious health threats. To see that toxic mold in building construction is indeed a matter for concern, consider the recent rash of lawsuits sweeping the country: In California, more than 100 workers have filed a personal injury suit against the County of Tulare and the contractors who built their new courthouse, alleging that exposure to mold has caused a variety of adverse health effects.1 In another case, in Washington State, a schoolteacher has filed suit against the contractor and others who participated in the building of a middle school on Bainbridge Island, alleging that exposure to toxic mold caused serious injuries.2 The contractor in that case later filed cross-complaints against several subcontractors who participated in building the site.3 And in yet another recent case in Chattaroy, Wash., teachers and students from Riverside High School filed a complaint against the Riverside School District and its superintendent of schools as well as against the contractors and architect who built an addition onto the school.4 Their complaint? That mold in the school made them sick.

Then there are the three Maryland workers who filed a suit seeking damages for injuries alleged to arise from exposure to "toxic" mold.5 Also, consider the former residents of two Seattle apartments who sued the building owner, alleging that substandard construction and maintenance allowed toxic mold to grow in the walls of their apartments, causing chronic illnesses.6 How about that cute little courthouse in California, currently scheduled for demolition because leaks and water intrusion allegedly brought about uncontrollable mold growth? Getting the picture? How about the case of the insurance company in Texas charged with child endangerment for failing to properly handle a water damage claim? You know the case? That's the one where they were also sued in civil court for $100 million for allowing the mold growth to occur.


Whether molds are beneficial, harmless, or "toxic" depends on where, when, and how they grow. According to the Environmental Protection Agency (EPA), all molds can cause health problems under the wrong conditions.7 Unfortunately, the press has taken up the hue and cry, often labeling several species as "toxic molds." That phrase may sell newspapers or increase audience share on the television, but it hardly helps solve any of the problems faced by people exposed to harmful molds. So, what is a toxic mold? The closest definition of that phrase I've found is that a toxic mold is any mold that regularly produces toxic compounds. However, some species of mold are commonly viewed as more of a problem than others, and not all toxic molds produce toxins all the time.

Often included on the toxic list are Stachybotrys chartarum, along with various species of Aspergillus, Alternaria, Acremonium, Cladosporium, Fusarium, Penicillium, and others. Currently, it appears that all molds require certain environmental conditions in order to produce toxins, so even the most vilified mold is not always toxic. The EPA is currently researching the conditions necessary for mold toxins to be produced and to become airborne.8 Please bear in mind that many toxins produced by molds are extremely potent.


So, what do these "toxic" molds really do? Among the many health effects with strong evidence correlating to mold exposure are allergic reactions such as irritation of the eyes, nose or throat; dermatitis; worsening of asthma; and respiratory distress. Other reported effects include fever, flu-like symptoms, fatigue, dizziness, headaches, and diarrhea. Rare, but more severe, effects can include hypersensitivity pneumonitis, invasive pulmonary aspergillosis (actual colonization of the mold in the lungs), allergic bronchopulmonary aspergillosis, or aspergilloma.9 Hemosiderosis, or bleeding into the lungs (especially in infants), has been blamed on the mold stachybotrys. However, researchers haven't conclusively linked hemosiderosis to mold exposure and continue to study this issue.10, 11


The key to dealing with mold-and with the rising tide of public interest and adverse publicity that surround the issue-lies in preventing mold growth in the first place. Many construction materials contain enough organic material to cultivate mold. (Stachybotrys, for example, is particularly fond of the paper used in gypsum wallboard production.) Since we cannot eliminate mold's food sources from the construction process, we must control the other ingredient mold needs to grow: moisture. Remember that without excess water (or, in construction, without the penetration of water through the building envelope) mold growth will not occur.

What does this mean for contractors and their employees? First and foremost, the "mold problem" is here to stay-it won't diminish as time goes on. Those contractors that recognize and deal with the issue will more likely succeed than those who don't. Second, issues of constructability, the integrity of the building envelope, and the ability to control moisture will only become more critical as we learn more about them. Third, the degree to which incomplete, "conceptual only," or outright improper plans are used to make daily construction decisions affects the long-term profitability and viability of a project. Contractors that reject inadequate architectural detailing will survive more often than those who merely shrug and build.


Of all the questions about toxic mold, probably the simplest to answer is "What causes it to grow on one project and not another?" There are three measures contractors can take that will eliminate the vast majority of mold growth. The first is to prevent the exposure of interior building products to exterior conditions. I personally recall one project manager in Northern California who (despite the fact that the roof had been left off the building through two very wet winters) was surprised that the installed sheet rock began turning green and black. Proper sequencing of work and coordination among the trades is vital to prevent this cause of mold growth.


The second step a contractor can take, which will prevent mold growth in the long term, is to achieve balance and moisture control in the building's mechanical system. To prevent mold growth (as well as for other reasons), water-pooling must be eliminated from the mechanical systems. Humidification should not be allowed to exceed acceptable parameters, and the systems should be easy to clean. Duct liners, duct placement, and roof and external-wall penetrations should all receive proper attention in the design and construction phases of the building. Proper maintenance after completion is also important, and building owners and operators should receive adequate instruction in maintaining these complex components of their properties.


The third primary step that will prevent moisture is to maintain the integrity of the building envelope.

Especially critical are the proper design and installation of doors and doorjambs, windows, parapet elements such as caps, flashings, caulking, waterproofing membranes (including proper lapping at architectural reveals, joints, and corners), roofing systems, and related components. Failure of any of these components often results in significant water intrusion, and water intrusion means mold. All too often, changes in one part of the building have unintended effects on other parts of the building. For that reason, comprehensive coordination by the general contractor or construction manager is vital and should not be neglected because of scheduling pressures or other transitory concerns. Proper attention to the design and detailing phases of construction is often the determining factor in successfully completing the project and avoiding of mold growth down the road. As the Barrett Commission in British Columbia notes:

The commission further notes that:

We would be arrogant indeed, and flat wrong, to assume that the problems that have recently plagued our neighbors to the north are not present in the United States as well.

Building owners must also properly maintain their structures. Many components of the building envelope, especially but not only the caulking, should be inspected regularly. For walls, regular water exposure (as from improperly adjusted sprinkler systems) can contribute to premature failure of stucco and degradation of the building. Improper drainage can also cause ponding, and water intrusion, leading to-you guessed it-mold growth.


As a final note, the real bottom line in preventing mold growth is a firm, concise, and easily followed quality-assurance plan. The three major points of any such plan must be a strong commitment to 1 building in strict accordance with the plans and specifications provided; 2 having competent design professionals completely correct flaws in plans and specs that are likely to result in water intrusion; and 3 documenting every step of the quality-assurance process, including, if necessary, photographing key installations as they are being put into place. If all of us in the construction industry followed these steps, we would maximize our ability to deliver a high-quality, waterproof building to our clients, and correspondingly minimize the likelihood mold growth and the ensuing litigation and costs. We in the building industry must do a better job of coordinating among all the participants in this process. As Benjamin Franklin observed at the signing of the Declaration of Independence, "We must all hang together; else we shall all hang separately!"

Dave Dolnick is risk manager for the Brady Companies, a multifaceted specialty subcontractor headquartered in La Mesa, Calif. He has been involved in the risk management field for more than 14 years. Before that, he served in underwriting, loss control, and marketing capacities with several insurance carriers. He has made presentations at national, regional, and local conferences on risk management, loss control, and safety-related topics.

Reprinted from the October 2001 issue of CONSTRUCTOR. In continuous publication since 1919, CONSTRUCTOR is the national magazine of the Associated General Contractors of America (AGC). For more information, visit AGC on the web at


  1. Sadler v. County of Tulare
  2. Fulgham v. Merit Construction Co.
  3. Merit Construction Co. v. Denham Glass
  4. Mielke v. Riverside School District
  5. Eddy v. Fegan
  6. Foppe v. Archstone
    (Above cases from
  7. U.S. Environmental Protection Agency (EPA), Mold Remediation in Schools and Commercial Buildings, Publication EPA 402-K-01-001, March 2001.
  8. EPA, "Children's Health Initiative: Toxic Mold," cited at page 4 in Davis, Pamela J., Molds Toxic Molds and Indoor Air Quality, California Research Bureau, California State Library.
  9. California Department of Health Services, Hazard Evaluation System and Information Service, Molds in Indoor Workplaces, March 2001.
  10. Davis, Pamela J., Molds, Toxic Molds and Indoor Air Quality, California Research Bureau, California State Library.
  11. U.S. Department of Health & Human Services, Centers for Disease Control, Morbidity and Mortality Weekly Report, Vol. 49, Number 9, March 10, 2000, Update: Pulmonary Hemorrhage/Hemosiderosis Among Infants - Cleveland, Ohio, 1993 - 1996, page 180 et seq.
  12. Barrett Commission (British Columbia), The Renewal of Trust in Residential Construction, Part II, Volume II, March 6, 2000, at page 5
  13. Barrett Commission (British Columbia), The Renewal of Trust in Residential Construction, Part II, Volume II, March 6, 2000, at page 47

For More Information
Contact David Dolnick
Phone: (619) 589-7575
Fax: (619) 462-1669
Mail: The Brady Companies
P.O. Box 1780
La Mesa, CA 91944

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