‘Laguna Address for a Song’ Hit Sour Note

Advertisements once touted the Laguna Audubon development as “a Laguna Beach address for a song.”

But the Kathryn G. Thompson Development Co. had to change its tune when disgruntled home buyers found out they were really living in Aliso Viejo.

And that discovery turned things into a soap opera.

The Irvine-based developer finally agreed to pay what reportedly was a sizable sum to end the squabbling in a hush-hush settlement that was concluded just last week when the last of the homeowners signed the documents.

The fuss is ironic because the current sales pace at Laguna Audubon--66 sales contracts signed in the first 41 days of 1991--indicates that current buyers don’t much care that the development is not in Laguna Beach.

Back in 1989, however, the owners of 170 homes in the first phase of the 362-acre planned community filed a suit against Thompson Development and its advertising agency, Martin Advertising in Tustin.

The owners claimed in the suit that they were misled by the company and its advertising into believing that their new homes were within the city limits of tony Laguna Beach.

In fact, the project--located near the junction of El Toro and Laguna Canyon roads--is just across the line in an unincorporated area known as Aliso Viejo.

The settlement agreement included a gag order that prevents the parties from discussing it, but Thompson’s attorney and the homeowners’ attorney, Scott Karlin, both confirmed that an agreement was reached.

Karlin wouldn’t disclose the size of the settlement, but he referred to his statements in 1989, when the suit was filed, and said he is “very satisfied” with the deal.

In 1989, Karlin said the group was seeking nearly $5 million in damages.

Although the accord was reached in late December, the last of the Laguna Audubon homeowners did not sign the agreement until last week, Karlin said.

Thompson Development no longer advertises the project as located in Laguna Beach.

And under a much-publicized agreement of several years ago, the developer also includes a disclaimer on all promotional material, stating that Laguna Audubon “has no connection, directly or indirectly with, nor is it sponsored by, the National Audubon Society or any of its affiliates.”