Turmoil Engulfs Residents Assn. in Mission Viejo : Homeowners: In-house squabbling may point to a larger question of control of the city. Some blame it on an undercurrent of suspicion against the community’s developer.

While Mission Viejo City Councilman Robert A. Curtis battles local developers and the Mission Viejo Co. for his political future, another contest is being quietly played out against a similar backdrop.

Its outcome, observers say, could chart the course of the city’s largest association of residents: the Lake Mission Viejo Assn., with nearly 16,000 household memberships representing about 60,000 people.

Strife within the association started with a petition drive in July asking the association not to accept a $450,000 gift, in the form of a roadside wall near the lake to deflect traffic noise, from the Mission Viejo Co. Assn. membership entitles families to use the 124-acre man-made lake.

But months of debate have done little to quell passions in the dispute, and other residents are waging a separate but equally impassioned struggle, creating a group called Citizens Against Mandatory Lake Membership, which seeks to break away from the association.

Various reasons are cited for the continuing dissent within the lake association, and not all critics stress the same issues. But an underlying current of suspicion involves the Mission Viejo Co., which founded the lake association and which critics portray as a meddlesome presence in the young city’s civic affairs.

Those same charges of meddling by the Mission Viejo Co. have dominated debate surrounding the effort to recall Curtis, which is being helped financially by the Mission Viejo Co., a wholly owned subsidiary of the New York-based Phillip Morris Companies Inc.

Curtis has been targeted for recall by a citizens’ group that charges he “represents outside interests” and is a carpetbagger and a divisive element on the City Council who does not properly represent its residents. The group has turned in petitions, and the city clerk is verifying signatures to determine whether there are enough to require a recall election.

Curtis has denied all allegations, countering that the real issue in the recall is his opposition to Mission Viejo Co. development plans. The Mission Viejo Co. has given at least $1,385 in the form of consultant services and a loan of furniture to the recall organizers, while two developers who have worked as subcontractors for the Mission Viejo Co. have given $20,000. New financial disclosure records will be filed this week. A spokeswoman said the Mission Viejo Co. supports the recall because of Curtis’ unsuccessful attempt to annex a pie-shaped parcel of developed land to the city, which the company opposed. Curtis’ pursuit of the annexation is central to several of the recall charges.

The role of the Mission Viejo Co. also is being questioned in the lake membership controversy.

“The Mission Viejo Co. is still trying to be parent and treating us as a child, and that bothers me,” said Larry Gilbert, a community activist who has emerged as one of the most vocal critics of the company and lake association. “They exert a lot of control, and I don’t like Big Brother telling me what to do and how to do it.”

Suspicion of the company cuts a narrow but deep path through Mission Viejo. Most longtime residents express admiration for the company, which began building the planned community in 1965. But there is a strong countercurrent of resentment as well, and it is asserting itself as the newly formed city tests its authority.

W.W. (Tex) Shannon, who organized the anti-wall petition drive that gathered more than 2,000 signatures, agreed that the arguments about the association are often really disagreements about the company.

“Everything has been kind of polarized,” he said. “People are either highly supportive of the Mission Viejo Co. and everything it does and supports, or they are suspicious of it. That’s led to some tension.”

Although the citizens’ committee and wall opponents have begun forging links and cooperating with each other, they came from different starting points.

The anti-membership group includes mostly older residents who are protesting a covenant in their deeds requiring them to be members of the lake association and pay $162 in annual dues, whether they use the lake or not. Association officials are unsympathetic, and the group has threatened the association with legal action.

Wall opponents coalesced in response to the proposed construction of what the Mission Viejo Co. calls an “enhancement project” along the lake shore. Supporters of the project, including the association management, say it would shield the shoreline from traffic noise along Alicia Parkway, but opponents argue that it will rob residents of their view.

That dispute seemed settled when the city, after seeing Shannon’s petition and hearing from residents vehemently opposed to the wall, rejected the proposal. But association officials, backed by the Mission Viejo Co., are pressing ahead and are expected to appeal later this month.

Some of the dissidents are also pleading with the city, asking officials there to try to give them relief from the association’s rules and management. City officials, however, are not eager to wade into the fray.

“The lake association is certainly a private organization and as such there is no direct relationship with the city,” said Mission Viejo Mayor William S. Craycraft. “In these cases of tension, the appropriate course would be for them to take their complaints to the board of directors of the association.”

Association officials, weary of the fighting and trying to keep discussion of the issues in-house, blame disgruntled minority elements for attempting to disrupt smooth operations.

“Fifty people screaming in a room would like us to think that they’re the majority, but they’re not,” said association President Jeff Miklaus.

As turmoil has engulfed the association, officials have worked diligently to keep any hint of disagreement to themselves, often refusing public comment and not returning reporters’ phone calls. The association held elections this week, but officials refused to allow members of the press and public to attend proceedings. Later, Gilbert accused officials of running a “sham” election, and only then did officials respond.

“Because I had more votes than Mr. Gilbert, that makes the election unfair,” Miklaus said. “I have a problem with that.”

Gilbert said proxies were used improperly during the balloting, but Miklaus denied it, and said Gilbert misunderstood the power of the board in an association election. As president, Miklaus has the authority to cast proxy ballots, which he did in several contested races.

Gilbert and other dissidents “don’t care who or what they step on to get what they want,” Miklaus said. “I have strived to make decisions based on what’s best for the majority of members, and I’ll continue to do that.”

Mike Sheean, an association delegate, was one of several who credited Miklaus and the board with adeptly managing a difficult situation, but he conceded that centrifugal tensions wrought by the two groups have put new pressures on association officials.

“Frankly, I’ve been surprised by the amount of opposition,” Sheean said. “I really think this is as much a comment on people’s feelings about the Mission Viejo Co. as it is about the association. . . . I think this is a case of people resenting that they feel dependent, so that when they get a chance to get even, they take their best shot.”

Still, not everyone is distressed at the way association business has evolved.

“Sure, it’s been tense,” Sheean said. “But in a community like this, where everything is so neat and tidy, I kind of welcome a little action.”