Caltrans OKs $25-Million Settlement in Malibu Slide

The California Department of Transportation has agreed to pay at least $25 million, and potentially as much as $75 million, to settle more than 200 lawsuits brought by owners of homes on Malibu’s Big Rock Mesa that were damaged during a massive 1983 landslide.

Litigation against Los Angeles County will continue, attorneys said. In October, 1985, a Los Angeles Superior Court judge ordered the county to pay $2 million to a Big Rock couple whose home was destroyed by the slide. That case is on appeal.

Under the tentative agreement, which was completed by attorneys Monday, Caltrans would pay $25 million, to be divided among the homeowners under the supervision of retired Los Angeles Superior Court judge and “People’s Court” television star Joseph A. Wapner. If the property owners fail to receive at least $50 million from the county, Caltrans would pay additional money to make up the difference.

The settlement must be approved by the Superior Court, the Legislature, Gov. George Deukmejian and the homeowners.

Kenneth R. Chiate and Richard D. Norton, lawyers for Big Rock residents, said they expect the court to consider the agreement within 30 days. Caltrans attorney Anthony J. Ruffolo said he hopes state authorization will come by September.

The agreement “is a milestone,” Norton said, “but it’s certainly not the end of the road.”

Potential total liability in the web of lawsuits against the state, county and various insurance agencies has been estimated at $200 million to $500 million.

The 1983 landslide was fueled by rising ground water on the site of an ancient landslide. The movement of the earth cracked walls, floors, driveways, tennis courts and the winding roads of the affluent neighborhood, which was home to several famous actors, directors and screen writers, including Pernell Roberts and John Houseman. About 30 houses were condemned by the county as unsafe, and the values of the others plunged.

Parts of the 1983 slide are still moving, according to a 1986 geologist’s report commissioned by the county.

No Construction

The homeowners contend that Caltrans is partly responsible for the slide because of cuts made in the 1920s at the foot of the mesa to build Pacific Coast Highway and because of its failure to object to the county’s approval of Big Rock development, despite a 1959 state study that recommended no construction there.

In late 1986, in the case of 12 Big Rock homeowners, a jury agreed that Caltrans was partly responsible. But in October, 1985, in the case of Margaret and August Hansch, Superior Court Judge Jack T. Ryburn dismissed the case against the state.

Ryburn decided, however, that the county did bear responsibility in the Hansch case, because its officials were “in the best position to assess the risk involved” in allowing construction on the mesa’s ancient landslide with seepage pits, rather than sewers, and “it must now bear the loss when damage occurs.”

The county has argued that the residents caused the slide because they stopped operating a private drainage system.

‘Legal Exposure’

Given the conflicting decisions about the state’s role, “we felt there was legal exposure, especially in the cases involving homes in the vicinity of the highway,” Ruffolo said. “We felt by settling at this point, we could . . . put a lid on the exposure.”

Even if the state eventually won every round in court, “this is expensive litigation,” Ruffolo said.

He said the state has spent $1 million in legal costs “and that’s only for about a dozen parcels.”

The state will continue about 400 countersuits against some of the homeowners, insurance companies, geologists and the Big Rock developers, Ruffolo said.

“We feel that we were not totally at fault and that our percentage of liability should be very low compared to the other parties. So we seek a contribution from those other parties,” he said.

The Caltrans agreement “is great for the homeowners, because they have the benefit of some money now, whereas otherwise they would have to wait several years,” said Chiate, who also lives at Big Rock. “Many of these homeowners have been evacuated from their homes and have lost everything they had in their homes.”

The settlement would cover about $5 million in residents’ legal fees, Chiate said.

Accepted Role

Wapner has agreed to oversee disbursement of the remainder, Norton said.

“It’s pretty unusual that he has made himself available,” the attorney said.

Wapner was asked to take on the job because he previously helped allocate a similar fund in the case of families living near a toxic waste dump, Norton said.

“And,” he added, “we’re all familiar with his work.”