SEAL BEACH : Mola Sues Officials, City for $11 Million

Mola Development Corp. has filed an $11-million lawsuit against the city of Seal Beach and three City Council members, claiming that the city illegally discriminated against the company by rescinding approval for its proposed $200-million Hellman Ranch development.

For the past 4 1/2 years, Mola has waged a battle to build a $200-million housing development on a 149-acre site. The city approved the plan and then, after the seating of two new council members, rescinded the approval.

“The city’s actions are arbitrary and capricious, intended to single out Mola for discriminatory treatment and to frustrate Mola’s development plan, and are without factual or legal support,” Mola’s complaint states.

The amount Mola is seeking--$11 million to cover land rights and pre-development costs--would wipe out two thirds of the city’s 1990-91 budget of $16.4 million.

The city’s original approval of the 335-unit Hellman Ranch project last October was thrown out by an Orange County Superior Court commissioner in March because the city’s state-required local housing plan was obsolete when the council’s vote was taken. Three months after the commissioner’s action, a newly installed City Council voted to reject the proposal.

City officials were not available to comment on the lawsuit Tuesday, but City Clerk Joanne Yeo said it had not yet arrived at City Hall. The lawsuit named as defendants the city and council members Frank Laszlo, Gwen Forsythe and Marilyn Bruce Hastings--the three who voted to rescind approval of the project.

Company officials have not yet given up plans for the development and are still hoping the state’s 4th District Court of Appeal in Santa Ana will reinstate the original approval given the project last October.