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Developers Knew of Landslide Risk, Lawsuit Contends

Court: Stability in area where six homes were lost was deemed 'generally less than acceptable' a decade ago, documents show. County officials defend permit process.


LAGUNA NIGUEL — Developers of a subdivision where four homes tumbled down a hillside in March were warned a decade ago about building on unstable ancient landslides but produced their own geological reports that persuaded county officials to let the project proceed, documents show.

Six landslides--places where layers of the earth once slipped--were identified in 1985 on a 900-acre tract where Hon Development proposed building more than 1,500 houses. Hon was told by its geological consultant that the stability levels of the six landslide areas were "generally less than acceptable," according to newly obtained documents, and that large parts of the parcel were "probably unstable."

But ultimately, the consultant and the developer believed that by excavating and buttressing the uneven slopes and redistributing 4 million cubic yards of earth, they could fortify the area and build safely, according to geological studies filed with the county.

Work on the Niguel Summit development commenced in 1986 but was halted that same year when residents of an existing condominium complex downhill from the development complained of cracking walls and buckling roads. But once more, Hon and its geological consultant, Leighton and Associates of Irvine, conducted a study and produced reports that persuaded the county that the tract could still be developed safely.

The problem on the hill, however, turned out to be what some experts working for the homeowners now say is a seventh old landslide that reactivated. On March 19, it upended condominiums and sent houses crashing into the ravine--11 years after developers had concluded they had solved the problem.

"Obviously, they were wrong," said Kenneth Kasdan, an Irvine attorney representing 26 homeowners who are suing the developer and others for the lost value of their houses located near those that were destroyed. The homes are valued at $500,000 or more.

According to more than 3,000 pages of records related to Niguel Summit, the early stages of construction were stormy:

* Development repeatedly was halted after complaints of mudslides, slope washouts, erosion and dust.

* Grading was interrupted nearly 40 times in two years over concerns that work was not done correctly and did not follow detailed plans filed with the county.

* Permits were blocked--temporarily--when the slope behind the houses on Via Estoril showed signs of failing in 1986 and 1987.

County Defends Process

County officials said the process worked properly: The landowner has the burden of hiring the experts to show the project can be safely and legally built.

Hon officials did not return phone calls to comment for this story. In a previous interview, Robert Smart, Hon vice president for finance, said the company is primarily interested in fixing the crumbling slope and settling with homeowners who have been displaced.

But charges of impropriety have been leveled in civil suits by homeowners and by owners of condominiums that also were damaged in the March 19 landslide.

"Builders do shop for their own geotechnical engineers," said Thomas E. Miller, a Newport Beach construction defects expert and attorney for the 41 condominium owners, half of whom have been evacuated from their homes. "We've even seen where builders have shopped around various soil engineers until they get the answer they want."

An official with Leighton and Associates said no professional geological firm would provide a developer with misleading information.

"Knowing the state of the art at the time, the standard of care that was adhered to is what any other geotechnical firm consulting at the time would have done," said Frederick Gebhardt, director of risk management for the firm. "It's one of those unknowns that comes back and bites you."

Though not risk-free, building above ancient landslides is generally accepted by experts if the landslides have been stabilized or removed by excavation.

But attorney Kasdan said the homeowners were not told about the old landslide activity when they were given subdivision reports at the time of their home purchases starting in the late 1980s.

"The documents given to them indicate a geological report was prepared. But they were not aware there were landslides in the area," he said.

When Hon proposed Niguel Summit in 1985, county officials were trying to monitor nearly 10,000 new houses being built each year, most in South County.

Maps and plans had identified the six previous landslides around Niguel Summit. Hon proposed building over portions of four of them. And county geologists agreed--though hesitantly at times--that those areas could be developed safely. Two other landslide areas were at the edge of the site. They were left undeveloped.

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