Condo Limbo : West Hollywood Law Limiting Apartment Conversions Upheld; Buyers of Units Left in a Legal Twilight Zone

Lee and Julie Kibbler looked at a dozen condominiums last year before finding one to fit their budget.

It was a no-pool, no-spa, no-frills kind of place, but from their third-floor vantage point, it offered a nice view of West Hollywood, and, most of all, it was something they could afford.

No one told them that West Hollywood had a lawsuit against the developer who sold them their home, claiming the 18-unit building where they chose to buy never should have been converted to condominiums.

They found out three weeks ago, after a state appeals court upheld a West Hollywood law prohibiting the conversion of apartment buildings to condominiums without the city’s approval.

“We feel like victims, when all we did was scrimp and save to buy our first home,” said Julie Kibbler, 33. “You would think we committed some sort of crime.”

They are among scores of West Hollywood condo owners left in limbo as a result of the ruling by the Court of Appeal. The three-judge panel directed a lower court to issue a restraining order barring future condominium conversions that violate a ban imposed by West Hollywood officials in 1984.

The ruling, issued in Los Angeles, left unresolved the outcome of conversions that occurred in violation of the ban, saying West Hollywood officials are best equipped to deal with the “variety of problems” the conversions pose.

Lawyers for various owners of the buildings who sold off units as condos have said they intend to ask the appeals court to rehear the case. Failing that, they said, they will appeal to the state Supreme Court.

But that is small consolation to Julie Kibbler, a free-lance writer, and Lee, 32, an electronics technician, who combined their small savings with an income tax refund to come up with the $7,500 down payment for their home.

“It might not be much for most people, but it was everything we had,” Julie Kibbler said. “No one ever said anything about a lawsuit. We never dreamed the city would come along three years later and question the rightful ownership of our property.”

Their consolation may be in knowing that they aren’t alone.

The ban began as a moratorium imposed by the new City Council the day West Hollywood became a city in 1984. The council made it permanent in 1986 with an ordinance making the conversions illegal unless the owners obtained conditional-use permits from the city.

No one really knows how many apartments have been converted to condominiums since the law was enacted. City officials estimate that there have been about 100, while lawyers for the owners of some buildings that were converted to condominiums say the figure is much higher.

After the owners of 26 buildings went ahead with conversions in defiance of the ordinance, citing permission obtained from the county government before the city was incorporated, the city went to court to halt the sales. But on three occasions, Los Angeles Superior Court judges ruled in favor of the building owners.

Lawyers for the building owners say the consequences of the court’s decision could be “mind-boggling.”

“Some of those units have been sold more than once. If, as the city claims, they’re not really condos but apartments, who do they (city officials) plan to come back on?” said Stephen L. Jones, a lawyer representing several of the building owners.

West Hollywood officials have said little about how they plan to proceed, except to say they do not intend to try to evict people who purchased condominiums.

However, several building owners involved in the conversions, speaking on condition that they not be identified, said they expect the city to try to impose a monetary settlement against them. In buildings where apartment units remain unsold, the city may try to get control of the units and make them available to low- and moderate-income renters, they said.

“We bear no grudge against individual (condo) owners,” Mayor Abbe Land said. “Our beef is with the developers who sold off the units, and we’re going to be meeting with them to try and work out a resolution to the problem without anyone losing their homes.”

Such assurances have done little to curb the resentment of condo owners whose property rights appear to have been clouded by the court’s decision.

About two dozen of them confronted the mayor and other officials at City Hall after a recent closed-door session of the City Council, accusing officials of negligence for failing to notify them that the lawsuit was pending.

“Where were you when my building was being converted, when we were buying our unit to keep from being evicted?” shouted Harry Herscovici, who bought his two-bedroom unit on Crescent Heights Boulevard last year to avoid having to move after the owner of the building decided to convert it. “You told us then nothing could be done, and now you say our condos are really apartments.”

City Atty. Michael Jenkins blamed the sellers.

“The fact of the matter is, your sellers sold to you without giving you notice (of the suit), and that seems to be the heart of the problem. That’s where your anger should be directed. . . . We don’t want to throw you people out in the street.”

But such assurances do not impress Julie Kibbler.

“They’re essentially saying, ‘We could throw you out but we’re not going to do that,’ ” she said. “Aren’t they wonderful people?”