I found water and some mold building in the basement. I tore away the drywall (up to about 4 feet above the floor) and found that the 2x4 that runs along and just above the drain tile ditch for the sump pump was soaked as are all the 2x4 vertical wall supports (anywhere from about 4 - 8 inches up). This runs the entire width of the house. I believe I will have to tear the rest of the drywall out and replace all the timbers, however, I want to keep this from happening again. I was told that the drainage ditch, which I can see has gravel in it, should have been capped off when they put it in.

Question: If I tear out the entire wall, how do I properly cap off the drainage ditch? I expect that I should also use treated lumber, at least for the floor portion of the wall support. Is that correct? Is there anything else I should do to keep this problem from happening?

My concern is the ditch big enough to Handel the water. Normally we cap of the ditch with 1 1/2 of Crete on top of the stone to keep the wetness out. Not sure how wide the "ditch is' Normally we use pieces of 2" to 3" Styrofoam to pour new floor to and then pull foam , fill stone up to an 1' or so to cap.

I didn't see if there was any insulation in the wall. A lot of this water seems like the classic case of a vapor barrier problem from inside the wall and building up on the lower portion. I also use a sill plate insulation under my treated bottom plate.

This is the proper way to insulates a basement which stops the moisture build up in the wall. It may be a two fold here on ditch size but my thoughts are if that much water was getting in there from the ditch alone then water should have showed up on the floor out from the wall. . Some good ref sites...

http://www.eere.energy.gov/buildings...s/db/35017.pdf

YouTube - Best way to insulate a basement 800x600

Thanks 21boat. There is insulation in the wall. Most of that was surprisingly still dry. There was water out into the floor when we first moved in several years ago. We had someone out and he advised that the sump pump pipe going out to the street was too small and that the roof gutters needed to be enlarged to industrial size. We had all that done at the time and haven't seen any water issues out into the floor area. This problem seems to be confined to the wall itself. I'll check out the two sites you suggested. Thanks again!