Two large real estate developers agreed to a surprise, secret settlement of their multimillion-dollar dispute Friday, aborting a trial that had consumed two weeks in Superior Court.
Craig Development Corp. sued developer James P. Warmington over a deal to build a 122-home development in San Clemente that fell through in 1981. Craig asked for more than $3.5 million in damages, mostly from a portion of a loan which Warmington allegedly failed to pay.
"It's a confidential settlement," Craig Meredith, vice president of the firm, said Friday. "We're not at liberty to disclose the amount."
Warmington's attorney, Angelo J. Palmieri, confirmed the settlement but declined to disclose the terms.
Warmington used the loan in part to buy the land for development. Warmington claimed that Craig freely agreed to give first rights to the property--if the project failed--to a bank that also lent money for it.
The deals were made in February, 1981, but by December, work stopped as Warmington encountered serious financial problems as interest rates skyrocketed and demand for new homes dropped.
Security Pacific National Bank, which had loaned Warmington $6.8 million for the project, foreclosed in 1983.