COSTA MESA — Brighton Homes will pay five Yorba Linda residents $620,000 each in what is believed to be one of the largest Orange County settlements of a suit alleging construction defects in single-family homes.
Filed nearly three years ago, the suit charged the Costa Mesa builder, controlled by developer George Argyros, with shoddy construction of homes that were purchased in 1989 for $430,000 to $600,000.
The homes had become waterlogged as a result of severe ground water problems, lawyers said. Cattails are sprouting in swampy backyards, and water has damaged carpeting and rusted furniture joints. Foundations contain concrete that is not suited to the soil conditions there, and are deteriorating, owners said.
Orange County Superior Court Judge William F. McDonald approved the settlement Tuesday. About 30 other residents in the Brighton Estates community of 75 homes have filed a similar suit, which is scheduled to go to trial in November.
The settlement "is a complete victory for the homeowners," said Ken Kasdan, an Irvine attorney who represented the five residents. "They've recovered more than they paid for the homes, and they get to keep them. That shows you the magnitude of the problems involved.
"When the suit started the developer said this was just over watering," he said. "It was nonsense."
Argyros, who is chairman of the board of Brighton Homes, was not available for comment Wednesday. Rudy Baldoni, an employee at Argyros' firm, Arnel Development, said the company had no comment.
Argyros is a high-profile developer in Orange County. He has been an outspoken proponent for a commercial airport for the El Toro Marine Corps Air Station and gave more than $1 million in loans to help defeat a ballot measure this year designed to block its construction.
Brighton Homes was one of the 20 largest Southern California home builders in 1989, selling 400 homes in Orange County. The company still exists, but has since stopped building, according to state records.
The home builder's insurance will pay claims in the case, said Kasdan, the homeowners' attorney.
Some of the homeowners, including Jim Emery, plan to use settlement proceeds to fix up their homes.
Emery said he bought his home in the estates in 1989, paying about $600,000. He and his wife, Cheryl, were married in the backyard the next year. But by October 1990, the swimming pool was beginning to crack and ground water was seeping into the home.
"We just found we didn't have to water the yard anymore," Cheryl Emery said. "We don't go out in the backyard. You can't have people over."
She said they plan to remain in the home for now rather than uproot their teenage children.
"I am still angry. I don't believe George Argyros went through anything. His insurance company will pay for everything. This was a very draining thing for us, and I just expected him to do more," she said.
Homeowner Julian Beals, 78, said he paid $575,000 for his home. "This was our dream home, and we used all our savings to get it."
Beals' wife died in November, but he said he plans to stay and fix the home the way she had wanted.
"I was always taught if you build something put some quality in it," he said. "I hope people in the building trades learn a lesson from this settlement and start building things they can be proud of."
(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)
Five Brighton Estates homeowners will each receive $620,000 to settle claims that construction defects caused their luxury homes to deteriorate. Brighton Estates location and details on the problem:
Number of homes: 75
Original sales price: $430,000 to $600,000
Homeowners filing suit: 37, including the five involved in the settlement; remaining suit is scheduled for trial in November
Alleged defects: Deteriorating foundations, driveways and pools due to incorrect water-cement ratio; water from surrounding hillsides seeping into yards and interiors; improper grading; improperly installed roofing; substandard construction of certain structural walls
Source: Law firm of Kasdan, Simonds, McIntyre, Epstein & Martin; Researched by JANICE L. JONES / Los Angeles Times